From David Warr.
I WAS very disappointed by the comments made in your paper by two people for whom I have a good deal of respect, namely Ben Quérée and Daphne Minihane, over the GST exemptions debate.

Is Mr Quérée (JEP, 6 April) advocating the running of Jersey’s economy through the use of a rear-view mirror? The world seven or eight months ago was a completely different place; not many of us had even heard of sub-prime lending or CDOs; Lehman Brothers still existed; Royal Bank of Scotland shares were still over £2, whereas today they are just 30p.

No wonder, then, six months after being elected some States Members had a change of heart when it came to exempting GST from food. In the light of what has gone on in the economy recently the last thing we need right now is more uncertainty. His comment therefore about sticking one finger up to the electorate suggests a degree of economic naivety, something I don’t normally associate with Mr Quérée.

I have in turn a huge amount of sympathy with Mrs Minihane’s views in the same issue. It’s tough for people on a low fixed income to survive in Jersey; but it would be even tougher if thousands of small businesses weren’t able to survive brought down by the ever increasing burden of red tape. Introducing GST exemptions would have been the equivalent of replacing the oil in an engine with treacle. It may not have stopped immediately, but be very sure that it wouldn’t take much more for the small business engine to seize up completely; an engine that employs 25% of the Island’s workforce.

No, the point that everyone seems to be missing apart from Senator Ferguson is, how do we bring the overhead that is our government under control? As she highlights: in 2004 the Treasury forecast that expenditure in 2008 would be £462 million; it turned out to be £526 million.

A £64 million overspend or by my estimates nearly 1½ times the amount of GST expected to be collected in 2008. If government can’t get close to their spending forecasts no wonder we need GST. At a time when government revenue is falling but expenditure seemingly rises inexorably it is inevitable that Islanders will increasingly pick up the tab.

The big question is, can this Island afford a government that costs £50 million a month to run? Having a go at the people who are trying to keep the economy going and who ultimately pay the bills is simply a distraction. Some tough decisions are going to have to be made sooner rather than later. Decisions, for instance, on the amount of money spent on emotive areas such as health and education. The GST debate was, I believe, just a wake-up call.
La Bicherie,
Rue du Moulin de Bas,
Trinity.