And you can read Deputy Roffey’s response and the kickback to it below: 

Dear Deputy St Pier 

THE MOORING CHARGES (GUERNSEY) REGULATIONS, 2023 – MOTION TO ANNUL  

The STSB President’s update to the Assembly, in July 2023, set out the financial challenge faced by Guernsey Ports, to fund much-needed investment in the island’s key infrastructure at a time when revenues are impacted by the downturn in travel, post pandemic.  

With the assistance of officers from Policy & Resources, the STSB had begun a comprehensive review of all revenue and expenditure. This included a review of all current tariffs, to identify where additional revenues can reasonably be achieved, which will have the most immediate impact in reducing the forecast trading deficit next year. Efficiencies are also being sought and new revenue opportunities identified, which together will make a significant contribution to a financially stronger Ports business, but may take time to deliver.  

That July statement set out clearly that if the Ports are to become financially self-sufficient again, they will have to act more commercially, particularly where fees and charges are concerned. That point was subsequently reiterated in the debate on the 2022 Ports Accounts, which reported a £4m loss last year. This year, a loss of around £6 million is anticipated.  

In November, the States approved Guernsey Ports 2024 budget, which was predicated on increases across a range of fees and charges, which have been widely publicised. They cover all ports activities, and include berthing fees for commercial vessels and leisure boats, passenger charges, freight/cargo loading fees, and rents.

The STSB has sought to spread the 2024 fee increases across all port users in a reasonable manner. Under the Board’s proposals, more than 80% of the additional, above inflation income for next year will come from increases in airport charges and harbour commercial fees. The remainder will be from increases in leisure mooring fees, and those are weighted towards larger vessels. For the vast majority of boatowners, the cost of a berth in one of the marinas will still be much lower than in Jersey, and the south coast of the UK, even after the proposed rise.  

Although factual, the 45% increase referred to in the motion to annul relates to only a very small number of drying out moorings outside of the marinas. This will affect around 30 boats, for which current charges are around £200 a year. More typically, berths in one of the marinas would see above RPI increases of between 12% and 22%, with the vast majority towards the lower end of that scale.  

The motion to annul is problematic in a number of respects.  

Firstly, the States has just approved the 2024 Ports’ budget, based on the publicised increases in fees and charges going ahead. As identified in the Rule 4 information, to limit the mooring fees increase to RPI + 2.7% (10% overall), the predicted outcome would immediately reduce by nearly a third of a million pounds against budget in 2024. The impact would however continue in the first quarter of 2025, resulting in an overall revenue reduction of more £410,000.  

This would increase the required taxpayer support by that amount.  

For avoidance of doubt, as the Rule 4 information explains the net impact against budget of a zero increase in leisure mooring charges next year would be a reduction of £544,000 during 2024. The proposed increases, which include an annual RPI uplift and including fees from visiting vessels, would actually generate additional revenues over 12 months of £725,000. That would be the full financial impact of a zero increase.  

The correspondence attached to the motion to annul also refers to cross-subsidy – an argument that has been put forward strongly by boatowner representatives.  

Guernsey Ports is not a series of individual, separate businesses. It is a single business and has been for the last 60 years. As such, there will be times when cash profits generated in some areas cross fund capital expenditure in other parts of the business. The States recognised this in the early 1960s, in establishing the Ports Holding Account, and that arrangement persists to this day.  

This pattern of internal subsidy will change from year to year. For the avoidance of doubt, the STSB expects the marinas to be heavy recipients of capital investment over the next few years and for the foreseeable future.  

It has been suggested, based on Guernsey Ports Accounts, that the marinas “make an annual profit of about £1m”. However that includes significant revenues from visiting yachtsmen, and until now there has been little focus on accurate apportionment of centralised costs (such as routine maintenance and depreciation) to the marinas. That is reasonable, since the ports are run as one single business.  

That exercise is now being undertaken at the behest of the current Ports Board, and is expected the real reported profit will then reduce to a much lower figure as a result. That is unlikely to be sufficient to service the future capital requirements of the marinas, which will be evidenced as the forthcoming investments begin to trigger increases in the depreciation charge. In fact we expect this section of the Ports’ business to run at a significant cash deficit for each of the next ten years. 

 That is not a problem in itself as the Ports are a single business, so not every part needs to wash its own face at all times.  

However at present, all parts of the business are being heavily subsidised by the general taxpayer, which must be addressed given the condition of Guernsey’s public finances. The current funding requirement is not sustainable, and the Ports need to adapt to the new, post-pandemic normal. STSB has not taken decisions on fees and charges lightly, but is determined to reduce the level of taxpayer support required by the ports as a whole. In that context, as part of an overall financial package, the STSB believes local leisure mooring fees should rise to a level that is more comparable with the market rate in Jersey and elsewhere. These increases are however weighted towards larger vessels.  

The STSB has taken on board all the concerns expressed through its consultation – from both leisure customers and commercial port operators. Any future year increases will be considered afresh in 2024, taking account of any impacts of these proposed rises.  

Finally, the package of increases the STSB agreed for 2024, spread across all areas of the business, will not see Guernsey Ports return to profit next year. However it will begin to make inroads into reducing the current requirement for taxpayer funding.  

In closing, the Policy & Resources Committee has recently shared lists of potential financial savings opportunities identified through the public consultation undertaken by the Reducing the Cost of Public Services Subcommittee. In those that related to STSB, the most prevalent suggestion from islanders was to increase moorings fees to more realistic levels.  

Yours sincerely  

Deputy Peter Roffey  

President States’ Trading Supervisory Board 

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GUERNSEY LEISURE BOAT OWNERS CONTINUE THEIR STRUGGLE WITH THE AUTHORITIES OVER DRACONAIAN MOORING FEE PROPOSALS 

Guernsey Ports and the States Trading Supervisory Board (STSB) have confirmed that they will target local berth holders in St. Peter Port and St. Sampsons harbours by imposing huge increases in mooring fees from 1st.April, 2024 for all parts of the harbours, not just in the marinas. 

They maintain that their justification for this heavy-handed policy is that local leisure boat owners have been subsidised by the Guernsey taxpayer for many years and that the berthing fees are too cheap when compared with other neighbouring marinas in the UK, France and Jersey. 

We strongly refute these arguments and would like to explain to you the taxpayer our reasons for doing so. It is time that the true facts were made public for you to decide. 

The devil is in the detail. 

The States presented the 2024 Budget Report at their last States meeting on 22nd.November which included increases of between 20-30% for 2024 despite our protests and our suggestion of a compromise of a 10% increase across the board regardless of boat size. This figure is above Guernsey Retail price Index (GRPI) of 7.3% but remains affordable to the average boat owner. It would generate a potential extra £350,000 revenue resulting in a total surplus of approx. £1.4 million pounds which would cover the budgeted costs for replacing outdated pontoons in the QE2 marina. 

Ironically Jersey States recently announced their berthing fee increases of 11% for 2024 which is marginally above their approx. JRPI of 10.1%. 

Following the Consultation Paper sent out by Guernsey Ports in September, they circulated all local leisure boat owners with a survey. The results were alarming. 63% of those who responded stated they would seriously consider selling their boats, especially when factoring in other additional operational expenses like maintenance, etc. 

If these owners follow their intentions, and by all accounts many will, the revenue from mooring fees is likely to reduce by £900,000 over the next 3 years, not increase. Plus the numerous marine traders will be badly affected by loss of trade. 

Guernsey Ports are relying on the so-called waiting list of 200+ prospective boat owners to fill any gaps created by those boatowners looking to sell their vessels but we doubt very much that this list will remain interested in taking on moorings with the prospect of these huge increases. 

Our counter proposal of a 10% increase will not see any significant reduction in berth holders. The marine traders can hopefully continue to operate and expand their businesses, creating wealth for our Island economy and attracting younger members of our society into the industry as apprentices. 

Isn’t it better to assist a thriving industry rather than decimate it! 

Guernsey Ports and STSB and the States Supervisory Board (STSB) maintain that the local taxpayer has been subsidising the leisure boat owners for decades but this is totally untrue. 

So, what happened to the Harbours Reserves of many millions of pounds? 

We need to examine the actual Guernsey Ports accounts to understand what’s been going on. 

It is agreed that the pandemic had a large impact on the Airport causing it to post large losses in 2020, 2021 and in 2022. However the harbour made small losses in 2020, and 2021 but recovered slightly in 2022 making a surplus of £0.836m. In reality since 1996 the Airport has made losses of £54 million and the Harbours have made surpluses of £32 million. That means that for every £1 pound of profit made by the Harbours, the Airport lost nearly £2 pounds. It is clear to see that the losses at the Airport are draining down the finances of the Harbours and depriving the Harbours of the funding required to maintain, replace and update its infrastructure over the last 3 decades. The problem is at the Airport, not the Harbour. This cross subsidy needs to stop now. 

It is noted in the forecast for 2023 (2024 Budget) that the Airport is forecast before depreciation to lose £4.931 million and the Harbour to make a surplus of £608,000. Again the problem comes back to the Airport, not the Harbour. 

The Airport will continue to operate at a loss and never be able to subsidise the harbours. It will always be a drain on the taxpayer but it is there as an economic enabler and as such should be subsidised by all of us, the Guernsey taxpayer, but not by 8% of the population or 1600+ individuals who happen to own a boat in a secure environment like a harbour or a marina with nowhere else to keep their boats safe! 

The Marina berths in 2024 will increase by 20 to 31% if the proposed fees are adopted, not the 12 to 22% as asserted by Mr Roffey! 

We note that the 2024 budget is for a Harbours operating surplus of £ 2.820m and the Airport budget is for a budgeted Loss of - £2.966m. The problem is not at the Harbours, it is at the Airport! 

The Harbours and the Airport were operated as completely separate businesses until September, 2009. Prior to that the only fact was that the Harbour and the Airport posted profits or losses to the Ports Holding Account (established 1962), both entities drew funds for normal capital expenditure and maintenance from the PHA and paid back capital and interest. It also meant that harbours could carry out necessary repairs and maintenance without having to go cap in hand to the Treasury for funds. That all ceased in 2009. 

This works well if both Harbours and Airport are profitable and each pays their Capital and Interest payments or depreciation. We accept the principle of occasional unforeseen “swings and roundabouts” situation where one or the other suffers an unforeseen loss. 

The fact remains that in the period 1962 to 1995 the accumulated position was Harbours posted profits of £6.8m to the Ports Holding Account (PHA) and the Airport losses of -£ 7.2m . In the early 2000’s the PHA had a balance of £26m and in the period 1996 to 2022 the Airport has withdrawn -£54 million and the Harbours has contributed +£32m. surplus overall, both nett. 

In the period 2009 to 2022 under this new Combined Harbours and Airport transformation into “Guernsey Ports”, the Airport have made substantial losses Every Year Total -£41m The Harbour made small losses in the Covid years 2020 and 2021 of £0.541m but contributed a net surplus of +£18.6m.in that period. 

The fact is that Mr Roffey’s stated “Swings and Roundabouts” situation does not exist. There has not been equal contributions to and drawings from the PHA . Basically the Harbours has put the surpluses in and the Airport has drawn it all out. 

The combination of Harbours and Airport into “Guernsey Ports” and the installation of overarching layers of civil servants running both operations was illogical from the beginning. There is no similarity between a Harbour and an Airport, there is no synergy, no economies of scale, no sharing of experience. They are as alike as “Fish and Fowl”. The Harbours should be split away and have it’s own Holding account and it should be run by mariners. The airport should be isolated and either run on a commercial basis or the States needs to support it. 

With regard to the split between Local moorings income and visiting yacht income, the Ports 2020 Accounts that Leisure income was £2.131m and there were almost no visiting yachts compared with 2019 when Leisure income was £2.914 including normal visitor numbers. This indicates that Visiting Yacht income is about £780,000 and Local Mooring income was about £2,100,000 for Guernsey Harbours so only 27% of the income is from Visiting Yachts. 

All parts of the Ports Business are not being subsidised by the Guernsey Taxpayer, the Harbours and the Leisure Mooring are profitable. It is the Airport that is being subsidised. 

In a recent report from consultants commissioned by Guernsey Ports to investigate comparable mooring fees in other jurisdictions, it was stated“ that St. Peter Port is currently undervalued within the benchmark set but it is acknowledged that the berthing infrastructure and associated facilities and marine trade services are lacking somewhat and prevent Guernsey Ports from increasing existing tariff rates”. 

In this regard, the service provided by Guernsey Ports is that of a municipal marina, not a private marina. 

We are aware that French marinas like Carteret, St. Quay and St. Malo are cheaper than Guernsey. In fact, it has been reported that to permanently moor a 50’ vessel in Carteret is 42% cheaper than Guernsey, but they offer better facilities and value for cash. 

The South Coast marinas stated in this consultant’s cursory report are mainly privately owned and managed and not run by any local Council. These private marinas charge higher fees but they are non-tidal. In other words, they are accessible 24/7 regardless of the height of tide. They also offer quality toilets/showers, on-site security, private parking short and long term, and packages including provision for laying up boats on dry land and for antifouling on drying pads, free crane or hoist hire, waste disposal of pollutants, etc. Plus their rates include VAT. 

From our research, the South Coast marinas are the most expensive in the British Isles with a catchment area of about 20 million people within a two-hour drive, whereas other UK marinas around the coats of Britain, including Scotland and Wales, are relatively similar to Guernsey after deducting any VAT charges and when comparing their superior facilities. 

Many of the UK boat owners with moorings in the above marinas use their vessels rather like a country retreat. They spend their week-ends living on board and may not even leave port. Unlike Guernsey where this attractive facility is prohibited by Guernsey Ports apparently due to potential pollution liabilities according to the Authorities, but it is obviously allowed for non-resident visiting vessels. 

This could be deemed to be discriminatory. 

Jersey marinas, although tidal except for limited private moorings in La Collette marina which is non-tidal, have all the above high quality facilities as in the UK and France. 

None of these services are provided by Guernsey Ports, let alone included in Guernsey Ports existing or future mooring charges. 

And we are probably the only leisure boat owners who subsidise an airport! 

WE are aware that there is a percentage of local people who are under the illusion that all local boat owners to be a bunch of whining, winging and wealthy individuals who should be paying more but we have always paid more than our fair share over the past decades, as I hope you will now see from our explanations. 

And we are very grateful for the support we are receiving from Deputy Gavin St. Pier and his fellow Deputies with their recently announced motion to be discussed at the next Sates meeting next week. 

However, we believe these such excessively and damaging mooring fee increases amount to a breach of the Guernsey Competition Law and we have now submitted an appeal to the Guernsey Competition & Regulatory Authority for their guidance. 

Nick Guillemette. (President of the Guernsey Boat owners Association). 

David Norman. ( President of the Guernsey Marine Traders Association).