We’ll spend it all
Friday 6th February 2009, 3:00PM GMT.
THE States will spend all of a £140 million reserve fund to get Jersey through the recession after experts warned that the economy could shrink by up to 6% this year.
Ministers revealed that they were now prepared to drain the Stabilisation Fund after the Economics Unit revised its forecast for the economy during the next two years. It has scrapped a previous estimate of 2% growth this year and is now preparing for shrinkage of between 2% and 6%.
It has also warned that the Island will experience anything between zero growth and a decrease of 4% in the economy next year. Income tax revenues are likely to fall as company profits, earnings and investments drop, and the States’ own income will suffer from historically low interest rates. The Stabilisation Fund, as well as a range of savings measures, will be used to balance the books.
The gloomy outlook was revealed yesterday as Chief Minister Terry Le Sueur outlined a blueprint for the Strategic Plan, which sets out social, environmental and economic priorities until 2012 as well as a range of longer-term measures. He said that although Jersey was well placed to get through the problems, the States were now preparing to use the available funds and were also looking at a range of measures to reduce expenditure and improve efficiency.
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If this is spent on creating a new energy industry then this could be an excellent opportunity for the Island and secure it through harsh times which may come. There is ample energy available from the sea at ALL states of the tide which could be sold or used to grow heavy yields of crops undercover. All we really need to survive is food and heat which the tides can easily but indirectly provide.
Will the states see sense or will they continue to support the finance industry which may collapse if governments worldwide work against tax evasion?
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Who said there was no recession in Jersey a couple of months ago?
What does the Chief Minister say now?
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But…….and these words will haunt you CM Terry, “there is no recession in Jersey”.
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looks like the penny has dropped?
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Well well – the recession is officially Jersey’s rainy day!
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I see a national debt on the horizon.
Or in our case we will re mortgage the Island and run up a debt for when the interest rates go back up.
Spend on what, builders, does that mean subsidising property developers ?
If spent on town parks, infrastructure, sports facilities, and things that actually improve quality of life of ordinary Islanders it would at least be fairly distributed.
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And then what happens when it’s gone? The days of lending and credit have gone forever and trying to spend your way through until they return is complete and utter madness. So under the new scheme if the value of my house goes down can I claim a subsidy? If my car won’t sell will the Chief Minister buy it? Can I claim back the difference between inflation and the higher charges for my electricity? Will my States rent go out and does that qualify for a rebate? If as States employee I get made redundant after 25 years of service do I now qualify for redundancy pay the same as the Woollies staff? If I worked for a retailer that goes broke next week do I also get my redundancy pay from this scheme?
Opp’s, we’ve just spent £140m Mr Minister, “ never mind now where is the rainy day cheque book, no one will notice if we use that as they forgot that I said that there would be no recession in Jersey didn’t they?”
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The builders and property developers will be happy. They make fortune on the way up and get millions of OUR money on the way down.
Then what? Higher taxes for the middle income earners? GST at 20%?
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I think you are all being mean the bankers must get their bonuses from somewhere, why not you?
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And he’ll stick by his ludicrous 20 means 20 idea which if revised could mean immediate and direct relief for a lot of people. Time for a re-think CM I reckon.
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We are officially in recession but we are still looking to spend 330 million on new offices and flats when everywhere else in the world is holding back
it looks like the only company in the uk to make money will be Harcourts.
Come on, wake up.
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“there is no recession in Jersey”
(At least not until AFTER the elections)
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david bridge and J G, do try and follow this: when TLS said LAST YEAR there was no recession, it was because there WAS no recession, here or in the UK. There is now, here and in the UK.
Do try to keep up.
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well you will have to now, everyone will want their redunancy pay!
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Funny, not a word about spending cuts! Don’t think the penny has quite dropped all the way yet!
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just stand down terry let someone who knows what there doing take charge you are to out of touch with the real world to know what is best to do with all that money
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Who will have money to spend in the new abattoir shops – perhaps Terry should stand at the entrance handing out rainy day cheques.
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Wrong N Norman – when Tel quoted that there was a recession in the UK I think you will find.
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Please get your facts straight when commenting, there are 2 different pots of money – the stabilization fund and the strategic reserve. The strategic reserve is the so-called “rainy day fund”.
What he is saying is that the stabilisation fund won’t go very far as it will be used to balance the books (when people lose their jobs there is less income tax generated and a larger demand on the income support system) so that we do not go into the red. I son’t think they’ve planned what to do with the millions in the rainy day fund yet – that will probably not be touched for a while as it’s all we’ve got in the bank (so to speak!).
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Should your headline not read
“We’ve spent it all”
??
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Normandy Norman you are completely wrong here and it is you who should keep up.
The below comments are lifted straight from the JEP. Le Sueur and co were, through incompetence or guile, recession deniers until 21st January 2009.
According to Le Sueur and his advisers there were no signs of a recession two weeks before the deputy elections, which kind of makes Pete’s comment absolutely 100% correct.
Read on…..
May 2008
“Speaking at the Chamber’s annual general meeting, Senator Ozouf said the fundamentals of the Island’s economy were sound, with evidence of confidence shown by the progress of the new States strategies, cuts in States spending and the lifting of the recession.”
11th November 2008
“JERSEY is not heading towards recession, the Treasury Minister said today after the news that the economies of Guernsey and the UK are going into decline.
Senator Terry Le Sueur said that there was, as yet, no evidence to suggest that Jersey would suffer the severe downturns which were being forecast elsewhere
Dougie Peedle, the States economic adviser agreed that there was no indication that Jersey was sliding into recession.”
21st January 2009
“Senator Terry Le Sueur told the States: ‘It is a question now of when Jersey might go into recession and not if.’
He made the remark just minutes before his Treasury Minister announced a rescue package to stimulate the faltering economy.”
Short sighted? Incompetent? Downright untruths? You decide.
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