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BUDGET DIGEST: Cheers? More money in your pocket...but pricier pints and fuel

BUDGET DIGEST: Cheers? More money in your pocket...but pricier pints and fuel

Tuesday 19 September 2023

BUDGET DIGEST: Cheers? More money in your pocket...but pricier pints and fuel

Tuesday 19 September 2023

Ministers have unveiled plans to leave islanders with more cash in their pockets to deal with the rising cost of living – while simultaneously pushing up booze and fuel dues – as part of their "steady course" budget.

Released this afternoon, the draft Government Plan proposes firm spending plans for next year and estimates for the following three.

Treasury Minister Ian Gorst described the 'budget' as "prudent and balanced" and said it would provide help to islanders struggling with rising prices.

If those plans get the green light from States Members when they are debated in December, tax allowances, pensions, spending on health and education and the cost of a pint will all increase.

Here are the key points you need to know...

What does this mean for islanders?

Some of the key proposals of the Government Plan 2024-2027 are.

  • Tax allowances will go up. These include:

    • Single person allowance – up £1,450 to £20,000

    • Married / civil partnership allowance – up £2,300 to £32,050

    • Child allowance – up £250 to £3,700

    • Childcare tax relief – up £550 to £7,600

    • Higher childcare relief – up £1,400 to £19,700.

  • £20 reduction in GP appointments

  • Free GP appointments for children

  • Pension increase of 7.26% above the RPI for pensioners.

  • £70 per month cold weather allowance for low income households

  • 15% increase in Health and Community Services budget to £287m for 2024

  • £113m of capital expenditure, including £3.5m in 2024 on a new youth club at Le Squez and £1m towards the building of a new secondary school for Mont à l’Abbé.

  • Other capital spending includes £19m on roads and sea defences, £5.2m on upgrading the island’s sewerage network, and £1m on cyber security

  • £450,000 worth of tax breaks, including a 60-day tax exemption period for short-term business visitors, and 150% ‘super-deduction’ for RegTech investment

  • A below-RPI increase in duty of 4p on a pint of beer 

  • A with-RPI duty increase of 7p on a litre of fuel

  • An above-RPI duty increase of £1.38 on a packet of cigarettes

  • A 30% increase in Vehicle Emissions Duty on vehicles producing 201g/km or more of carbon

What's the latest on getting a new hospital?

The document also provides more detail on the ‘New Healthcare Facilities Programme’ – this Government’s plan to replace the island’s creaking General Hospital. 

It estimates that building a new inpatients’ hospital at Overdale, and advancing plans for an outpatients’ unit in Kensington Place and ‘Health Village’ in St. Saviour, will cost £710m over the next five years.

However, figures will only be finalised when an ‘outline business case’ is published next year, which will then be debated by the States Assembly in June or July.

How is the public purse faring?

The Treasury is expecting £119m more income next year compared to this year to total £1.2 billion, fuelled by rising interest rates boosting profits in the finance industry.

However, it plans to spend £161m more than it will this year, which includes allocating £70m across departments to meet inflationary costs, resuming payments into the social security fund with a £57m grant, and adding £48m of new revenue expenditure.

Making savings...and borrowing money

One the flip side, the plan factors in £10m of savings across the board under the Government’s ‘Value for Money’ programme.

It also includes £52m of borrowing from the Government’s ‘revolving credit facility’ with banks, to pay for work on the new healthcare facilities.

What the Ministers say...

Commenting on the draft plan, Deputy Gorst, said: “In these uncertain times, responsible fiscal management is paramount. We are committed to ensuring that our finances remain resilient and sustainable. 

“This Government Plan reflects our dedication to maintaining a steady course while delivering essential services to our community. We can only afford this through the strong growth that we are seeing in our economy, despite challenging global economic conditions.”

Chief Minister Kristina Moore added: “Our Government is dedicated to supporting islanders through these challenging times. 

“We understand the struggles many face, and this Government Plan reflects our relentless focus to addressing these issues head-on. 

“By setting out a clear vision for the years ahead, we aim to build a stronger, more resilient, and more inclusive Jersey for generations to come.”

Click HERE to read the document in full.


ANALYSIS: As the next budget looms... What should we expect? - Express looks at the strength of the public purse, and the key pressures facing Ministers and the island...

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