Cuts and culture change

Friday 12th February 2010, 3:00PM GMT.

BEFORE the battle of the budgets comes the war of words. As politicians of different persuasions, nervous public servants and dogmatic union leaders peer from their entrenched positions towards the coming conflict over necessary cuts in States spending, there has been a certain amount of sabre-rattling but, so far, little in the way of action.

In recent days, Treasury Minister Philip Ozouf,  Public Accounts chairman Ben Shenton and the independent public spending watchdog, Comptroller and Auditor General Chris Swinson, have all had things to say about the mission to cut £50m a year from States budgets if Jersey is to stay in the black.

There is a broad measure of agreement between them – and also, indeed, from Unite leader Nick Corbel – in as much as no one doubts that this will be a hugely difficult task, with the many costs of failure including, according to Mr Swinson, the prospect of GST at 12 per cent.

Where the Treasury Minister and the de facto shadow chancellor part company is over the questions of how public finances got in such a mess, whether the current administration really has the will to solve the problem and whether there has been any effective control over States spending in the last decade or so.

Senator Ozouf insists that there has, but on the face of things it is difficult to disagree with Senator Shenton’s contrary analysis, presented this week in a timely speech to a receptive audience at the Institute of Directors. His simple statistic of a 38.5% rise in spending over five years tells its own tale.

Even more importantly, Senator Shenton has rightly identified that achieving cuts in the face of a combination of intransigent unions, empire-building civil servants and ministers less united behind the cause than the doctrine of collective responsibility might require them to appear in public will be much more than an accounting exercise.

As he has said, nothing less than a profound culture change will produce anything like the required reduction after so many years of careless spending and expanding payrolls.

Recent protestations that every possible significant saving has already been made will ring hollow to any taxpayer with experience of working in the private sector, where life is very different. Until clearly shown otherwise, the same taxpayer is entitled to a degree of scepticism about the depth of the current administration’s sincerity.

Some years have now passed since we were promised a three-legged approach to balancing public finances: economic growth, tax increases and reduced States spending. There are no prizes for guessing which of the three promises has been broken.