S&P row: ‘Disappearing’ WhatsApp messages can’t be released, but Niles stands by GST borrowing argument

A WhatsApp message at the centre of a political row cannot be released because it was sent in a group with ‘disappearing’ messages turned on, Express understands.

The message – sent by Deputy Andrew Niles – kicked off a row about whether GST is needed to maintain Guernsey’s S&P credit rating.

Several deputies referenced the message during last month’s tax debate, with Deputy Andy Sloan telling the Assembly that Deputy Niles had admitted in a WhatsApp group that “part of the reason for GST is so we can borrow more money”.

While Deputy Niles didn’t dispute the existence of WhatsApp messages in the chamber, he later publicly dismissed the idea that the GST package was being introduced to increase borrowing.

However, the WhatsApp message itself can no longer be produced, because it was posted in a chat where disappearing messages had been turned on.

Despite the row, Deputy Niles insisted his position had not changed.

“A tax reform package that includes GST will allow us to balance our books and demonstrate fiscal discipline,” he told Express.

He said that would put Guernsey in “the best possible position to borrow” if funding was needed for infrastructure and housing projects.

The row is the latest skirmish in a wider battle over transparency, and focusses on whether deputies and the public were given a full and accurate picture of S&P’s position during the tax reform debate.

‘My position has been consistent’

Express asked Deputy Niles a series of questions, including whether the WhatsApp message discussed the relationship between GST and borrowing, whether Deputy Sloan’s interpretation was accurate, and whether he would be willing to release the messages in full so the public could judge the context for themselves.

Deputy Niles said: “Thank you for your questions. Rather than answer each one, I’d like to address them in the whole.

“My position has been consistent, in every conversation, chat, speech and public statement – as I believe it was in the discussion you refer to.

“A tax reform package that includes GST will allow us to balance our books and demonstrate fiscal discipline.

“That, in turn, will allow us to invest in infrastructure and build the homes we need, and if needed to achieve that, be in the best possible position to borrow.

“That is the point I have made throughout, and it remains my position.”

WhatsApp allows group administrators to set messages to automatically disappear after 24 hours, seven days or 90 days.

Express understands Deputy Niles was not an administrator of the group in question, and therefore didn’t take the decision to turn on disappearing messages.

Controversy

The controversy grew out of last month’s tax reform debate.

According to Hansard, the official record of the States’ Assembly, Deputy Niles said: “I would like to look at again the downgrade cost, because I think it is a real one.

“I think that if we take GST off the table now, it does give an opportunity for Standard & Poor’s to downgrade us, and I suspect that that will come quite swiftly.”

Opponents of GST argued that deputies had not been given a full and accurate picture of the credit agency’s position before voting on the proposed tax package.

Several deputies questioned why neither S&P nor Guernsey’s ability to borrow were mentioned in Policy and Resources’ (P&R) tax policy letter, if it was going to be used as an argument in the debate.

P&R later rejected suggestions it had “misrepresented” S&P’s views, arguing that some deputies and sections of the media had instead created a misleading impression of P&R’s position.

S&P announced February it was maintaining Guernsey’s A+/A-1 credit rating, after previously having downgraded our rating in 2023 and 2016, with the latter being partly attributed to Brexit.

What is the S&P credit rating?

The S&P credit rating is an assessment of how likely a government is to repay its debts on time – similar to a personal credit score but for a country or jurisdiction.

The score can influence how much it costs to borrow money, investor confidence, and the island’s international reputation.

The ratings go from AAA (the best) down to D (the worst).

Guernsey’s long-term rating is A+, while its short-term rating is A-1, with a “stable” outlook.

That’s lower than Jersey’s long-term score of AA-, as well as the UK’s AA rating.

However, it puts Guernsey comfortably in the “investment grade” bracket, which S&P says means it has a “strong capacity to meet financial commitments, but [is] somewhat susceptible to economic conditions and changes in circumstances”.

What did Express ask?

Here are all the questions we asked to Deputy Niles.