The Digital Greenhouse in its current form is dead, with Economic Development (ED) announcing the venue will have to close unless the committee can find a private sector firm or volunteers to run it.
The innovation hub, which was set up in 2016, costs Guernsey taxpayers about £450,000 a year in subsidies.
It’s undeniably worrying news for the hard-working team at the Digital Greenhouse and the many small business that use their co-working space or take part in its programmes.
But many people who are not directly affected will have taken the announcement as an encouraging sign that someone in government is looking to make meaningful savings, which will reduce the island’s financial “black hole”.
But anyone hoping this is a sign of the States “getting its own house in order” before raising taxes shouldn’t hold their breath quite yet.
Express asked ED two questions:
- Will the money saved be spent elsewhere, or will ED be reducing its budget by £450k?
- Also, will staff who are reallocated to other parts of the civil service keep their current packages, or could they face pay cuts?
The short answer? “We can’t tell you.”
‘Budget could be spent elsewhere for greater impact’
Deputy Marc Laine, Vice-President of ED, said the committee “still believes that government investment into digital innovation and incubator initiatives is important, and that it can add value to the sector, however it believes that its budget could be more effectively spent in ways which would have a greater impact”.
“How that money will be spent, and how much of the cost of the Digital Greenhouse will be returned as a saving, will be determined by the Expressions of Interest process,” he added.
As to what will happen to staff and whether they’ll keep their current packages, he told us: “We’re not commenting on individual staff circumstances.
“We are following established HR procedures, and as such, the staff will be offered redeployment into other vacant roles within the States.”
Save or spend?
While it’s not a firm commitment either way, Deputy Laine has kept the door open for keeping hold of the £450,000 subsidy and spending it elsewhere.
So if you’re hoping the States has just had an epiphany and decided to rein in spending instead of raising taxes, don’t celebrate just yet.
£450,000 a year is about 1% of what the States would need to find to plug the financial black hole – and all without cutting ‘front line’ services.
If the States as a whole could do that 99 more times, the island wouldn’t need tax reform – or the ever-unpopular GST.
But that would only be the case if Economic Development decides to treat the full £450,000 as a genuine saving, not if it plans to spend it elsewhere.
Whether it will spend the money or bank it, only time will tell.
