States spending to be slashed
Monday 1st February 2010, 3:00PM GMT.
Treasury Minister Philip Ozouf
UNPRECEDENTED spending cuts were signalled today as ministers announced ambitious plans to cut States spending by £50 million a year from 2012.
The Council of Ministers said that there would also be tax increases, new charges for States services, an efficiency drive and a review of which services were not absolutely necessary in the coming years to fill a year-on-year deficit.
And they say that savings will fund not just the deficit, but any upfront investment necessary to make efficiencies, a contingency fund for unforeseen expenses and the necessary growth in essential services like care for the elderly.
The details of the comprehensive spending review process were agreed at a Council of Ministers ‘away day’ meeting at Highlands College on Thursday.
Treasury Minister Philip Ozouf – who is deputising for the absent Chief Minister Terry Le Sueur – said, however, that although decisive action would be taken, Islanders could feel confident about the state of Jersey’s finances.
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Believe it when I see it. The Treasury promise savings every year and then the States go and vote to spend more on stuff we don’t really need.
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This has to be dealt with. The time wasting in the States avoiding the issue throughout 2009 is letting the voting public down. How many manifesto pledges did we see in 2008 claiming to work for states efficiencies yet how many propositions have we seen from the left to date that would only cost the tax payer millions of pounds? It is important that we work to see a change in States thinking and new candidates with more common sense should consider putting themselves forward in the next elections.
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And poor old TLeM got a roasting for missing 1 meeting,how many is the CM missing?
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The last round of ‘cuts’ just resulted in the money being spent elsewhere.
It is OK for Phillip Ozouf to talk of cuts, he does not spend the money.
The Ministers of health, education, etc are likely to be a lot less keen on delivering cuts with less services and redundant staff.
I feel a hefty increase in GST is not far off!
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Why the delay until 2012, if I realised that I didn’t have enough income to cover expenses I would stop spending NOW not delay doing so until 2 years time. I accept that staff cuts require some consideration and phasing in but why not be up front now about where the actual savings are to be made.
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The wording Tax increases should apply to the rich. For example, 30 or 40% taxation on all income about £50,000, Gordon Brown recently increased the tax for the rich but can Philip Ozouf follow? or will he pick on the poor easy victims?
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£50M. A joke. Didnt it increase by that alone last year.
£150M should be the target – and by next year.
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No cuts in staffing levels planned I bet and more 10% cost of services rises planned. Watch out as GST goes up as well. One day they will understand what efficiancy savings really means. Most of us will have left by then as we will not be able to afford to live here!!!!!
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Based on the track record of budgets versus what the States actually end up spending, the black hole will be nearer £80m than £50m. The issue has a root cause based on three points – one of governance – i.e. who is responsible for efficiency and who controls spending – the civil servants or the politicians. Also decisions are overturned and spending allowed to increase;
One of mind set – give a minister a budget and he will spend it. There is nothing in place to encourage or reward spending reductions;
One of extravagance – Jersey unfortunately is spending well beyond its sustainable means and has got used to it. Just compare the spending to other comparable jurisdictions..
The solution ? Set a states spending cap – a level fixed in stone and then task the departments, ministers and civil servants with meeting the reduced level of expenditure. Three years starting this year would be a good start..
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the problem is who should bear the brunt of the cuts.Because taxpayers spending is not accountable online such as in America the public do not have much of a say in this matter, only a secretive minority takes these decisions.
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Nothing much will happen in 2012 or 2015 for that matter.
The States do not have a strong record on decision making. Witness the interminable wrangling over the incinerator.
Most of the big spenders in the States eg Deputy James Reed at Education are heads of big resource hungry departments where cuts would result in loss of resources to schools and hence a lot of immediate political pain.
At least 80% of the present States members will be there next time round and reform will still be distant smoke on the horizon.
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So it’s good bye to the Rainy Day fund then.
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As a Jersey man who left the Island 10 yrs ago, I can tell you what states spending cuts means….
The Government are very good at making spending cuts up here in the UK.
It’s called public sector Jobs, that means anyone who is not at the top…. Watch out!
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“ambitious plans” to cut spending (in two years time!)
What a joke. Is it April 1st or Feb 1st? States enpenditure will continue to rise in real term, and the burden of tax will continue to rocket as far as the average tax payer is concerned
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Agreed at the “away meeting” 1 ) taxes are going to increase. I agree they will 2 ) we are going to pay more for public services. I agree they will 3) States are going to cut SPENDING by £50 million a year. If anyone believes this pigs will fly
Ozouf is the father of all spindoctors. The problem is that he actually believes his own spin. The other sheep ministers simply follow
What’s that saying again about leopards and spots ?
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And why is Terry le Sueur not chairing one of the most important meetings of the CoM that will decide spending priorities for years to come?
He is according to Monday night’s Evening Post attending a religious conference!
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Oops, sorry about that, it is Saturday night’s Evening Post.
But a huge policy decision that will result in a 10% cut in public expenditure has been agreed without the Chief Minister being in attendance!
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The best thing nearly all the states members can do for the welfare of Jersey is to quit their jobs. This is the worst government we have ever had!
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We might see a cut in highly paid architects whose plans are currently blowing in the wind.
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I commend the notion,why don’t I believe it will happen..?,maybe it’s facts like we have had a prescanned version of the Verita report,at a hefty cost,followed swiftly by an announcement thhat we will be immediately re hiring them on another contract just to see if the whole hospital system is in fit order,more expens..! we have far too many managers in there already costing us millions,we have millions wasted in suspensions from work and additional locums in place yet the report criticises dependence on too many locums,we are paying for endless skills apparently,and still we now want to go outside of the island for someone to peer in and tell us are alright,for if that is so why do we pay the staff we have if they with inside knowledge do not know what is wrong and how to put it right why do we need them..in truth we don’t because this runaway civil serviice wants more staff less work no responsibility,and someone else to blame when it all goes wrong,Ann Pryke is not up to this job and a more dynamic powerful person should be at the helm..this at a time when we are strapped for cash is appalling,we need root and branch change, value for money and a management structure we can trust….where will these savings be made..as usual in all the wrong places,they are just warming us up for loss of services while they hire more and more of their own kind then tell the elderly and infirm that they can no longer afford to transport them up or that school milk must go…remember…just a few weeks ago…?
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Oh well they will cut money to schools, health and police agin and all the other services we need. But keep their blackberries and free parking and keep doing road works on the avenue. There are not enough police on the streets already but I bet they will reduce them even more. Our hospital is becoming worse than England, sure they will target that too. I’m sure its time they had a go at school milk again. We cant possibly afford to look after our children and our local heritage. Blackberries are more important.
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Read between the lines this is Public Spending cuts AND more taxes!
This is NOT:
Efficiencies
Cost savings
Reduction in overpaid non entities
Removal from office of those ‘suspended’ on full pay.
Review of un-necessary posts/consultants etc
We the public will get less, the states will carry on spending!!
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Has anyone seen any notification of which building firms are getting the £40m Emergency aid?
Why are we subsidising VCP and JCG to the tune of several million pounds?
Our states members may have their fingers on the pulse but unfortunately the patient is dead..
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I bet you a penny to a pound of dog droppings that VAT oops, sorry GST will be rise to 15% in this new decade.
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“Why are we subsidising VCP and JCG to the tune of several million pounds?”
“We” are not. Every child at JCG and VC is, to my knowledge, the child of a tax payer in the Island. Given the number of lawyers and accountants in the car park of a morning, I suspect many parents pay large amounts of tax. So they are not being “subsidised”: they are simply gaining some benefit for the significant tax contribution they make. You need not worry – in the scale of things they are still subsidising you.
If the States did not pay for half of VCP and JCG’s costs then there would be 2 possible outcomes. The first is that VC and JCG would have to become entirely funded by the States: at significant extra cost.
The second is that VC and JSG would become entirely fee paying. However, if parents wanted an entirely fee paying school, why are schools like Helvetia, St George’s and (to a lesser extent) St Michael’s struggling and in some case failing to fill their classes?
What the States should in fact be doing is widening the JCG/VC model and getting more parents to supplement school income.
If the JEP wanted to look into this, they might be interested to see that VC has recently changed its admissions policy and now a significant number of boys are not progressing from VCP to VC, and as a result, VCP is no longer accepting many children from JCG Prep.
I suspect one implication of this is that parents may think twice about sending boys to JCG Prep: it doesn’t seem to prepare boys for admission to VCP better than States schools, in which case what is the point of spending £3,000 a year for 3 years? This is actually a big story which I urge the paper to look into.
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No. 23 VC and JCG are heavily subsidised by the parents. States schools are a free handout.
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Get rid of all of the States workers that sit and do nothing but shuffle paper and act surly to the public (Traffic, Town Hall, Tax, Social Security, Housing etc etc). These people are supposed to serve the public, well I am not satisfied with the service they provide me.
We keep these jobsworths who lack common sense, humility or any other skill required to fulfill their role, in employment until they pick up a big fat pension. They would never be employed in the first place in the Private sector.
This is where the drain is
You could easily reduce the workforce by 50% – Imagine the savings !!!
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No.25, you are having a laugh. The cost of a decent private day school education in the UK is now £20k a year. People sending their kids to VC & JCG probably don’t pay a third of that. A massive transfer payment for what is in effect private schooling from other taxpayers.
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13.Beanandgone – you have so hit the nail on the head.
Trouble is, it’s all very well posters on here wanting half the States staff to lose their jobs but there are several unpleasant consequences with such action. Less income tax, more social security payments, people spending less money. And if the States spending does reduce that means less trading with private sector firms.
Be careful what you wish for folks!!
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Efficiencies should be a big cut in the number in Jersey Government, having so many deputies and senators and chief this and that, and consultants coming over is all costing far too much, thats where the efficiency costs should start!
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Why not do away with the States of Jersey Police and save millions. They are not essential and we’d still have the Honories, ‘by cri’ yes eh?
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No. 28 What nonsense, the cost of a private 9-3pm education in the UK is not 20Kpa. You must be referring to school plus boarding costs at Eton.
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#31
Spot on.
not only are they allowed to retire at 50 with a big fat pension they often get more work as taxi drivers bank messengers etc.
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£50M. A joke. Didnt it increase by that alone last year.
£150M should be the target – and by next year.
Simon (no 7) got that right.
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Live with it or deal with it, or leave the island whether you are local or not. The UK has 17.5% VAT. House prices will fall and perhaps “fantasy island” will come to its senses. You have had it too good for too long anyway!!! Wake up!!!
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Bella # 33. Why stop there? We could also have Honorary States memebers instead of paying for professional, inept noncompoops…..we used to have honorary politicians in the past and they didn’t make so many mistakes as our so called professionals.
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The Truth is Out There – Along With an Increase in GST
I’m not at all shocked at the announcement by the Auditor General Chris Swinson that the government will have to increase GST up to 12% with a “pessimistic” estimate of a £171m deficit by 2014 if it does not stop its extravagant spending programs.
I have been calling for the States of Jersey to reign in its excessive spending since standing for election in 2005 and It’s unfortunate that it takes a global melt down of our financial markets to draw attention to its out of control spending and misappropriation of public funds.
The number of civil servants that we now employ is out of control. The UK faces the same problem with its government and are finally facing up to the fact that the civil servant gravy train will have to pull into station sooner rather than later.
I think it’s important to point out that I’m not against the public service, far from it in fact. We need a high quality public service which includes not only manual workers, but high quality management as well. To maintain Jersey to the high standards that we have come to expect and provide the services that we all enjoy.
But here’s the problem…
I have been trying to work out why any States Member would want to employ someone like Bill Ogley who is the Islands Chief Executive to the Council of Ministers and the island’s senior civil servant. Or Steven Izzat (Waterfront) who them earn close to £250k a year each, when the States Member employing them only earns £42K?
Why would you want to create positions like these and pay these massive wages when they are 5 times what you earn as a States member? Either they are being paid grossly inflated wages or the States Member is not getting paid enough. Or both and vice versa.
I would like to see if these chief officers could earn anywhere near this sort of money in the private sector and turn a profit to achieve it. Instead of the taxpayer and consumer paying in increased taxes.
Coming back to GST….
It’s because we have politicians like Senator Ozouf, Senator Le Main, and Senator Le Sueur who see nothing wrong in employing these people on these grossly inflated wages and paying them with public money that we are in the financial mess we are in today.
I have absolutely no doubt that we are going to see GST increased.
The only way to stop this cycle of tax and spend….. spend then tax, is to vote these politicians out at the next election.
This announcement by the Auditor General is just a warning shot across our bows to start preparing the brain washing that will come inevitably come from the States PR unit in how it’s the only way to balance the books. We heard all of this when they brought in GST and it made no difference to our deficits other than allowing the States Members to keep spending money that haven’t got! And keep taxing us more to pay for everything.
But wait, because that’s not the whole story…
Jersey’s Council of Ministers have agreed to £50m in spending cuts over the next three years. Now if you believe that you will believe anything! What they are not telling you is that they intend to do what they did the last time they saved £20m…and that is to spend it on something else!
The money saved will actually go into a contingency fund and to be used to fund growth in essential services. So where is the real savings of £50m coming from then? The fact is that no real term savings of money in the bank will occur.
Same old spin…same people spinning it.
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Unfortunately the States over the ‘boom’ years have set up a welfare system based on the UK, but we can now see this is not possible with a 20% rate of tax
Jersey is not a ‘rich island’ as we can see from the deficit figures. There are many well paid and rich people here – that is not the same thing.
We have to live within our means, as said above why does an island of 40 square miles need civil servants paid over £200,000 per year – don’t forget what their pension liability will be on top of this.
We already pay enough tax for this expensive to live location. 12% on top of 20% makes a move somewhere else more inviting.
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Roy,
What a lot of hot air.
So Bill Ogley gets paid £250k. Well, I’ve worked with him and while I wouldn’t say I naturally warmed to the guy, he was competent. His salary is pretty much the going rate for a top-end civil servant. It’s a bit high and given the change in the world since 2005 and now we could probably get a similar replacement for a little bit less.
But if you think you can employ anyone to head up an organisation with several thousand employees and a budget of £600m, for less than £200k, you are sadly mistaken.
The fact that he gets paid more than politicians is irrelevant: compare his CV to that of say Jeremy Macon or Trevor Pitman and you’ll see the difference.
So, we could save £50k possibly on his salary. But it’s a far cry from £50m: is it really the best you can come up with?
If we are to save £50m, we need to identify big areas where the States are currently involved where they do not have to be. And given the breakdown of the States budget, they have to be in the areas of Health, Social Security and Education, because that’s where all the money goes.
And for those who wanted to buy Plemont, or have a town park, it is time to realise that these things have a cost, and that cost is the percentage rate of GST.
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Another good way to slash costs would be to convince Sen Maclean to halt this Tourism Quango idea,the last thing Jersey needs is more quangos which become bottomless pits into which yet even more hard earned tax payers money dissapear usually with well below par results, Regardez Le Waterfront…as if you give a big pile of money to a group who do not have to make a profit…you know what..? they’ll spend their way through it and then some.the proper way is to commission what you want and haggle for the best deal possible….except of course when it’s not your money,Privatisation is superior pay on results only…and less spent in La Capanina.
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