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Growing calls for a States' debate before spending £15-20m on a ferry

Growing calls for a States' debate before spending £15-20m on a ferry

Wednesday 26 January 2022

Growing calls for a States' debate before spending £15-20m on a ferry

Wednesday 26 January 2022

The Policy & Resources Committee says the reason it does not require States’ approval to spend an estimated £15-20million on a new ferry is that the vessel would provide a financial return and therefore could be purchased through a States’ investment fund rather than by using the capital reserve which pays for most capital projects.

Last year, the States delegated unprecedented authority to the Policy & Resources Committee to approve expenditure of around £500million on various projects with only minimal involvement from the States’ Assembly.

But this delegated authority is largely restricted to projects which appeared on a list approved by the States – and the list did not include a new ferry.

However, the States’ Assembly now has even less input into the activities of the Guernsey Investment Fund, which was set up by the States to generate long-term financial returns through investments which may benefit the Bailiwick. The Policy & Resources Committee yesterday told Express that this is the Fund which it hopes to use to invest in a new ferry without requiring the approval of the States’ Assembly.

Policy & Resources Committee

Pictured: The Policy & Resources Committee yesterday told Express that its view that States' approval is not needed to invest an estimated £15-20million of public money in a new ferry is based on the funds coming from the Guernsey Investment Fund and the vessel generating a financial return for the States.  

“It is intended that the proposed investment in a ferry would be in partnership with Condor and would be made by way of an investment generating a market return, not through direct purchase by the States,” said the Committee. 

“The States’ Investment Board will shortly be considering whether to make an investment in local infrastructure, in line with the States’ Investment Rules, which were approved in October 2015 as part of the 2016 Budget Report. The Investment Rules allow for investment in infrastructure assets of any type and the Guernsey Investment Fund is developing a proposal for consideration by its Board for a ferry investment to be part of the portfolio.”

But today the Committee is facing growing calls for a States’ debate on its plans to invest in a new ferry and on long-term sea links policy generally.

“I don’t think it matters what complex financial vehicle Policy & Resources might use to purchase this ferry in order to try to overcome the fact that it would not have the authority to purchase it from capital, I still don’t believe the Assembly should be sidelined in this way,” said Deputy Yvonne Burford, President of the Scrutiny Management Committee.

Deputy Yvonne Burford

Pictured: Deputy Yvonne Burford says she does not necessarily disagree with the States investing in a new ferry but thinks the Policy & Resources Committee is going about it the wrong way.

“This is not an urgent matter. Ideas of buying a ferry have been kicked around the States since shortly after the Liberation first threw its mooring lines ashore in St Peter Port harbour.

“We should have had a policy letter from Policy & Resources on a sea links strategy by now, which would have enabled not just States’ members but also the community to have an input into the future of sea travel to and from the island. Instead, we get a unilateral decision from Policy & Resources.

“Some people might say that at last things are happening. But I suspect that support will only last as long as they find themselves in agreement with those things.

“I’m not necessarily averse in principle to the idea of buying a ferry. In fact, I supported it around the Policy Council table around seven years ago, but I am opposed to it being done this way with no idea whatsoever of what risks we are taking on or how it fits into the wider strategy going forward.”

Express has spoken to other deputies who are considering submitting a Requête to require the Policy & Resources Committee to lead a States’ debate on sea links before an estimated £15-20million of public money is spent on buying Condor a new ferry.

Deputy Gavin St Pier

Pictured: Deputy Gavin St. Pier is one of a group of deputies who are considering submitting a Requête to require a States' debate on transport links policy before up to £20million is spent on a new ferry for Condor.

“I think the only way to avoid bringing the purchase of a ship to the Assembly would be to treat it as an investment. The rules governing investments give Policy & Resources very broad discretion,” said Deputy Gavin St. Pier. 

“It could be done through a new infrastructure cell in the Guernsey Investment Fund. Launching an infrastructure cell has been on the cards for a while and is something we looked at during the last term. The decision to buy a ship would then be one for the Board of the Guernsey Investment Fund, rather than the States, after the Fund had done its own due diligence and satisfied itself that it would be a good investment decision.

“For me, though, I can’t get my head around making such a strategic decision as buying an additional ship before the States have debated and approved the policy framework for air and sea links promised in the Government Work Plan before the end of 2021 but now not due until much later this year. 

“A Requete is probably the only way to force a debate on the matter. I’ve no idea how much appetite there would be for that but it may be worth looking at.”

Speaking before the Policy & Resources Committee’s replies to Express outlining its hope to use the Guernsey Investment Fund, Deputy Peter Roffey said: “[I] struggle to understand how Policy & Resources have delegated authority to buy a ferry. Surely their new power to approve capital spending only covered items approved under the Government Work Plan. [I’m] not saying it’s a bad idea – just that I think it needs [States’] approval. [I] have written to Policy & Resources seeking an explanation.”

Deputy Peter Roffey

Pictured: Deputy Peter Roffey has written to the Policy & Resources Committee asking for more information about its plan to invest millions of pounds in a new ferry without a States' debate.

The Committee said yesterday that it is continuing negotiations to buy a new ferry.

“The negotiations around the purchase of a vessel are ongoing and being conducted in commercial confidence and there is therefore little more that can be disclosed at this time,” said the Committee.

“The Committee looks forward to providing further details once an agreement is reached, allowing for a vessel to be secured, improving the capacity and reliability of our sea links.”

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