DAY by day, there are new reminders of the seriousness of the economic crisis now engulfing the world, as well as the uncertainty of its outcome.

The latest came in the States yesterday, when Treasury Minister Philip Ozouf announced unprecedented action to stimulate the Island economy in response to indications that the prospects for 2009 are now looking worse than originally feared.

It has long been accepted that there is little Jersey can do to influence the wider economic factors which affect us, such as the setting of interest rates and the fluctuations of world trade. Now for the first time, in addition to continuing efforts to control local inflation, there will be direct state intervention in the form of the emergency use of public funds to support businesses and thus, it is hoped, protect the Island economy from the worst effects of the crisis. At the least, this admirably decisive move to adjust the balance through use of the new Stabilisation Fund created for that very purpose should buy some time and encourage some much-needed confidence.

In the early stages of the so-called credit crunch, as Senator Ozouf told Members, Jersey’s economy remained ‘remarkably resilient’. Now, in the light of changing conditions, a slowdown in all areas, including finance, construction and retail, and an acknowledgment by Chief Minister Terry Le Sueur that it is only a matter of time before Jersey goes into recession, he is proposing to dip into the £140m fund to finance short-term investments and projects that will provide work for companies and individuals as well as the skills to tackle them.

This is not the celebrated States ‘rainy day fund’, the Strategic Reserve which remains in place as a final resort to fund essential services in the event of a catastrophic collapse in revenues, but active consideration of its use is a clear indicator of how concerned the Island’s government is about the prospects for various industries and the jobs in them.

It is important, too, to note that the Stabilisation Fund will only be used in ways which match the ‘Three Ts’ criteria recommended by the independent Fiscal Policy Panel – timely, targeted and temporary – and cannot be an alternative source of funds for pet projects. Meanwhile, the Treasury has ordered a fuller assessment of economic trends for 2009. At the heart of both initiatives must be the question of how jobs can be both protected and created as we move into waters which, despite the slight advantage over other jurisdictions offered by the prudent creation of this fund, remain worrying unpredictable.