The seemingly never-ending row over GST has found its latest battleground: pensions.
After weeks arguing over whether businesses did or did not support Policy and Resources’ (P&R) tax reform proposals, politicians are now clashing over claims spending controls could leave pensioners worse off.
Employment and Social Security (ESS) President Deputy Tina Bury was forced into an embarrassing climbdown after claiming the number of pensioners would increase by nearly 12% in three years – only for ESS to later admit the figure was wrong and the real increase was closer to 4%.
However, Deputy Bury did not withdraw her wider warning: that pensions could face cuts if her committee was prevented from increasing spending faster than inflation.
That argument has now been challenged by Deputy Garry Collins, who says the debate is focusing on the wrong problem.
“The problem is not our local pensioners, but the almost 6,000 pensioners now living off-Island,” he told Express.
Deputy Collins said the cost of supporting people who have retired elsewhere had been overlooked during the wider debate about Guernsey’s finances.
He claimed that almost £200m had left Guernsey over the last decade through pension payments to people no longer living on the Island, while arguing that the current debate had focused too heavily on local demand.
‘Solving the wrong problem?’
Deputy Collins said politicians needed to look beyond simply raising more money and instead question whether the current system still works.
“I think someone said I’m thinking the unthinkable,” he said.
Deputy Collins also questioned whether people who leave Guernsey should continue to benefit from pension payments designed for the island’s higher cost of living.
“Someone could be here their entire working career, and they benefit by paying a couple of grand less in tax every year because they put money into their pension scheme,” he said.
He said they could be “off” once they retire, moving to a cheaper part of the world but still getting “the same payments as someone living here”.
Third of pensioners have left
Deputy Collins questioned whether pensions for people living off the island should continue to rise using Guernsey’s RPIX inflation measure.
He pointed to previous ESS research which showed a pensioner couple in the UK could live significantly cheaper than one in Guernsey.
“Why are we increasing pensions based on Guernsey costs when a third of people are not living here anymore?” he said.
Deputy Collins argued that introducing GST could increase the amount of money leaving the island, because pension payments would also rise.
“You’re going to put up pensions,” he said. “But actually 31% of that are not on the island.”
‘Reserves aren’t running out’
Deputy Collins also rejected suggestions that Guernsey’s pension system faces an immediate crisis.
“I am not surprised by the way the tax debate highlighted the additional cost of pensions, but some of that narrative is wrong,” he said.
He pointed to the ‘Guernsey Insurance Fund’, which he said had grown from around £740m in 2019 to almost £796m at the end of 2025.
Deputy Collins said describing reserves as “running out” was misleading, arguing the fund exists to help manage future pension costs.
Calls for reform
Deputy Collins said he attempted to push for further investigation into pensions while serving on ESS, but claimed additional work was blocked.
He has since left the committee and said he believes he can have more influence by bringing proposals directly to the States Assembly.
“I am now better being on the outside of ESS and bringing amendments to the Chamber,” he said.
Deputy Collins said he planed to bring forward a package of reforms later this year covering pensions and other benefits.
The latest pensions row adds another layer to the wider argument over GST and Guernsey’s finances.
ESS says the challenge is how to fund rising demand from an ageing population.
Deputy Collins argues the bigger question is whether politicians are looking at the right problem before asking islanders to pay more.
