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The 2023 Budget was passed last week but using his past experience as Treasury lead for the States, Deputy Gavin St Pier has let us in on a little secret on the island's finances.
The backbencher says talk of a balanced budget is all part of a mirage.
In his own words, he explains why.
Pictured: Deputy Mark Helyar presented the budget to the States last week, and it was passed with very few amendments.
"Budget debates are not what they used to be. Once upon a time, not very long ago, Budgets could face 40 hostile amendments and tie the States up in debate for four days. This year’s Budget debate was done and dusted in a rather dragged-out two days and faced a mere seven amendments, of which only six were debated. Unusually, five of the six amendments had been seconded or led by members of the Committee that had prepared the Budget. Although, having seconded one amendment, perhaps having seen the wind change direction in debate, Deputy Helyar then voted against it. Perhaps following the crowd was what he meant in last week’s resignation statement as the leader of the Guernsey Party, when he referred to ‘clear and unambiguous leadership?’
Only one amendment from Deputy De Lisle attempted to alter the budget arithmetic in any way, with all the others being policy based. One was a motherhood-and-apple-pie amendment from Deputy Inder, directing that committees look at joint working with Jersey. As Deputy Ferbrache said in the debate on this, it had nothing whatever to do with the Budget, but he and the majority of the States then went on to vote for it anyway, as nothing feels better than warm, motherhood and apple pie, does it?
Pictured: An attempt to charge every household an increase of 8% on their TRP was defeated.
To be fair to Deputy De Lisle, he’s been nothing other than consistent in the last ten years (and probably more) in arguing that the tax on rateable value (TRP) is the spawn of the devil. His amendment would have introduced a flat rate increase of 8% in TRP for all properties, rather than, as P&R had proposed, exempting 74% of local market properties from any change, by having larger properties take all of the pain this year. Deputy De Lisle is equally consistent in failing to declare any interests in matters under debate unless or until prompted by a member raising a point of order. On this occasion, I took that task upon myself, given it was obvious that he would benefit from the amendment he was proposing. The Presiding Officer ruled it was a valid point of order, the interest was declared and the amendment soundly thrashed.
Deputy Murray’s speech in general debate was a solid case for a loyalist seeking the vacant seat on the Policy & Resources Committee following Deputy Soulsby’s resignation. It was a masterclass in vacuity: it was as empty as the black hole he sought to describe. Having, apparently been ‘sold a pup’ by someone before the 2020 election, he demanded that we can – indeed must – ‘do things differently,’ without, of course, being specific as to what that should be, despite two years of experience that you might have hoped would have generated an idea or two. In good news for P&R, despite whatever election promises voters might think they heard from him in relation to tax, he seemed to be swinging in behind the Committee’s soon-to-be published tax proposals.
Pictured: The 2023 Budget was passed - with duties going up on cigarettes, alcohol, and fuel, as well as other changes.
The States’ Budget is always presented as ‘balanced.’ In other words, the messaging is States’ members can’t tinker with it arithmetically or it will no longer balance. What this really means is don’t try and cut taxes or increase spending anywhere. (If anyone proposed raising a bit more in revenue or spending a little less, no-one would get too fussed that the ‘balance’ had been disturbed in a positive way.) But I’ll let you into a little secret, the balance is a mirage in any event. Firstly, there is one big fat made-up number called the Budget Reserve. This is a slush fund – I can feel treasury officials’ discomfort at such language - for all those things that might just happen during the year, on top of all those things that you think really will happen. You hope stuff doesn’t happen, but it’s life, so it does. For example, it was the Budget Reserve that was the source of drought-related financial support to dairy farmers this year. Secondly, all budgets (for any organisation) can only be best estimates of what you think may happen.
The one sure thing is the final outcome, even if in line with budget, will not be exactly as budgeted. So, the fact that the States has budgeted for a surplus (before capital spending) of £33m in 2023 is not one of the Ten Commandments carried off Mount Sinai by Moses on tablets of stone. Our world – and the States – will keep on spinning quite merrily if the surplus for 2023 turns out to be £33.5m or £32.5m (or, say it quietly, even £22.5m.) So, it really wasn’t heretical for Deputy Queripel and I to propose giving 470 full time carers an extra £4.60 for their 35 hour week at a total annual cost of £166,000, but the idea was defeated nonetheless because it would have ‘unbalanced’ the budget. Never mind, those carers will, I am sure, be happy to have heard lots of fine words instead about how important they are to our community."
