Guernsey’s outgoing Policy & Resources Committee has delivered a blunt financial warning just two days before the advance polling stations open in the island’s general election.
P&R say they are revealing a “significant deficit” and stressing the “urgent need for action from the incoming Assembly”.
The Committee say they chose to release this update ahead of the official 2024 Accounts publication on 23 June, with the President of the Policy & Resources Committee, Deputy Lyndon Trott OBE, who is not seeking re-election, stating it was “important to provide this financial update in advance of the General Election given the significant and understandable focus on public finances”.
The ‘core’ States of Guernsey accounts – which excludes the island’s commercial entities – are predicted to show that the island recorded a £44 million deficit in its day-to-day operations for 2024. That’s including a £9 million deficit in General Revenue, and a £13 million shortfall in Social Security Funds.
While States investments saw a £130 million increase in valuation by the end of 2024, leading to an overall ‘core’ surplus of £34 million, the Committee clarified these are “investment valuations and not returns”.
Deputy Heidi Soulsby, Vice President of the Policy & Resources Committee, who is also leaving the political landscape, emphasised that these valuations “don’t impact the amount of money we have available to deliver public services and invest in much-needed infrastructure”.
Deputy Trott reiterated his previous assessment, stating “in October when we published our 2025 Budget proposals I described the state of public finances as parlous and that remains the case – the States cannot continue to rely on reserves built up in the past to fund the services of today and tomorrow”.
He urged that “the new Assembly will need to immediately focus its attention on the issue of improving public finances. I cannot stress enough how important that is to the long-term prosperity of the island”.
The Committee estimates an “underlying, or what is called a structural, annual deficit of around £56m”, with Deputy Soulsby adding “we are not raising enough through taxes to fund the services our community relies on”.
She concluded that the decision for the next States “will not be whether something needs to be done, but what should be done to balance the books”.