Having read the dismal news on England's economic borrowing in the Times this Sunday and other broad sheets. The true cost to the population of wards closing, medical staff reduction, staff reductions across the private sector. Public sector workers having to re apply for there jobs on less wages or being made redundent. No I am not joking.
It focuses the mind more clearly on the economic future at home here on Jersey.
There are many that are worried in the economic world. However if there was ever a time that Jersey needed a strong Government with a radical shift in thinking it is now or we get the hell that could be Jersey tomorrow.
The signs are not good, based on the entrenched long time States members, ( establishment ) versus the newbies ( upstarts ) verses common sense with a big dose of poor if not ridiculous inaccurate information spin offered to some in Government let alone the people of Jersey.
We could draw on countless examples of waste; inefficiency overspends and clear mismanagement of the public purse by the States. It will not offer anything new, the moneys gone what to do now?
The truth in my opinion it’s a culture based on spend, spend and keep spending that is most dangerous to Jerseys financial well being for the future. It always was going to end a some stage. We have arrived.
Read scrutiny reports and it becomes clear very quickly, that due to successive failings in financial management of Government departments they are not even sure where all the money is going.
We are where we are, Jerseys tax revenue stream has been decimated by incompetent bankers, weak regulators, low interest rates, less profitable businesses, partly due to less tourists etc etc etc.
Minister Phillip Ozouf is going to need big help by those in the assembly to be successful. No man is an island, excuse the pun.
The economics minister is either going to have to tax us all to death ( leading to Jerseys gentle slip into poverty ) or make deep cuts that nobody wants. The first is not really an option; not enough people work in relation to the enormous inflated amount it costs to run this island. So a new incinerator has to be paid for, but the infrastructure is built, and the schools, hospitals, transport system are in place.
What is
not clear, but should be in these dangerous economic times is nice but not needed is no longer viable.
The airport is a good example, Jersey is proud that we have a new tower which is taller and super duper ( says Senator Paul Routier ). Similar sized airports that work to CAA certification are graded on their size and traffic and do not suffer the same regulations imposed on large airports like Heathrow. Guess what thats why they have smaller towers and buildings. Jersey has to have a new £6 Million pound tower, £650,000 fence and £4 million pound hall, to make Jersey proud. Grow up. This is just a folly that again, works against the financial interests of Jersey. serving mainly outside interests.
The new departure hall is mostly run by English companies, which will obviously take business away from local retailers, (again) while not contributing to Jerseys falling tax take ( the new off island company tax laws ) not even GST. The culture of spend spend in a dropping tourism market. Need I say more.
Minister Philip Ozouf has seen the writing on the wall. he has little choice but to cut. Is he going to be remembered in history as the visionary and statesman who brought proper accounting and proper accountability to the stabilisation of Jerseys economic future ? Or just another waste of space ?
Could it be that the spend, spend culture that needs to be addressed ( sorry make that attacked ) is beyond the view or intellect of many of the elected, that make up our Government, having never been responsible for running a business or balance sheet ? Several want to play the game of attracting votes through populist shouting and short term bad policy.
The CoM have been accused of withholding information and / or making it difficult to access for other States members to appreciate the situation.
If the economics minister decides to use his diplomacy he will make a few phones calls to leading opposition members. Tell them to put the kettle on and lay out exactly the truth of how bad being in the red is going to affect a small rock of 48 square miles with little to offer as collateral to borrow millions. Then comes the sticky problem of increasing profitability to service the borrowing.
If we sink at least he can say he did his best,as long as he trys to get all States members on board, the gift of a true statesmen. Without support from all sectors of the house with pet projects he, (we) will be in trouble with amendments coming thick and fast to spend more money, underpinned by a public sector who care only about more money being deposited, for their mini empires to spend.
Some home truths that you may wish to read from Kevin Keen, his figures conflict with those from the chief ministers communications department.
Quotes are selective please read full article, links below.
But his views cannot be dismissed so lightly. Indeed, they are now endorsed in principle by the man responsible for putting the choke-chain on excessive spending, Treasury Minister Philip Ozouf.
http://www.thisisjersey.com/2009/09/02/gst-and-states-spending/In the latest edition of the Chamber of Commerce newsletter, Mr Keen writes that Islanders and States Members should get behind Treasury Minister Philip Ozouf’s efforts to squeeze public-sector spending.
http://www.thisisjersey.com/2009/09/01/states-spending-could-double-gst-warns-chamber/• States net revenue expenditure has increased by 88% or £244m per year in the last decade. That is pretty much double the rate of inflation.
• That expenditure has far exceeded the level projected in the Council of Minister’s own Strategic Plan for 2006-11. In 2008 it was £30 million higher and in 2010 the overspend will be £65 million!
• In spite of a pay freeze, a lot of ‘shroud waving’ and a projected drop in States income of £94 million. Net revenue expenditure will actually grow by £26 million or 4.6% next year.
http://www.thisisjersey.com/2009/08/27/cutting-costs-is-a-must/Election Statements / promises.
Senator Philip Ozouf The key is value. When I was vice-president of Finance and Economics in 2002-5 we reduced spending. The Comptroller and Auditor General has reported that further savings are possible. Some of these are going to be challenging to achieve without affecting essential services. I have proved that savings can be made at Economic Development and believe that a similar strategy can work in other departments. In addition, the States work out of numerous sites, and consolidating these would increase efficiency and reduce cost. I am tough but realistic and fair on spending and I have shown I focus on delivering best value.
Deputy Sarah FergusonImprove financial management and control. Implement the provisions of the Spending Review, which has estimated that at l east £30 million of savings and efficiencies are possible. The Public Accounts Committee is already on the case. I want it to have a louder voice when discussing States spending. An all-Island mandate will give me that voice.
Boatyboy.
