Chief Minister - Our plan can cope with Brexit and population growth

Friday 08 July 2016

Jersey’s Chief Minister has launched a staunch defence of his financial blueprint for the Island for the next three years.

In an often heated 90 minute grilling this afternoon by the Corporate Services Scrutiny Panel, Senator Ian Gorst was continually called upon to defend the controversial Medium Term Financial Plan.

It outlines how money will be raised and spent over the next three years, and how the States can make savings and become more efficient.

The hearing was one in a series of meetings which are going to be held in the run up to the States debate at the end of September.

Amongst the things the panel wanted to know more about were the effects of Brexit on the plan, potential job losses, a health tax, funding the building of a new hospital, and population control.

Panel member St Clement Deputy Simon Bree wanted to know how robust the plan is in the light of the United Kingdom’s quitting the European Union. He fears the value of the Island’s investments could go down and this could result in a financial black hole. He wondered if the figures should be readjusted.

Senator Gorst argued there was enough flexibility in the plan to react to any changes in the markets, and even claimed the uncertainty surrounding Britain’s exit could boost the Island’s economy and benefit Jersey’s books.

St Saviour Deputy Kevin Lewis wanted to know more about how the plan will affect jobs. It’s been rumoured more than 250 full time posts could go. Senator Gorst said the States were currently conducting a second round of voluntary redundancies. But, when pressed said he couldn’t rule out compulsory redundancies. In the past 18 months 20 management posts, with salaries of more than £100,000 a year have been axed.

Another panel member, St John Constable Chris Taylor wanted to know what he should tell his parishioners about the proposed health charge. Those who have private health schemes feel they are being made to pay twice. But, Senator Gorst said that’s no different to the current situation where they currently pay into a private scheme and are taxed.

Still with health, the panel was keen to find out how the Island’s new multi-million pound hospital is going to be funded. Assistant Chief Minister Senator Paul Routier said that was not tackled in the plan because it is still a long way off. He did say though that a number of options were being considered, and the most likely approach was a “blended” one in which there might be more taxes, the selling off of States’ properties, and/or borrowing money.

One of the final questions was what size a population the plan was based on. The number of people living in the Island affects how much tax is collected and how much money needs to be spent. The ministers were unable to give a definitive answer. Instead they told the panel the plan must be flexible and react to economic and social factors.