I MUST be mellowing in my old age. I’ve started to agree with a lot of what the Chamber of Commerce says.

It’s true that I still think there are too many chamber members and other businessmen who fail to appreciate the importance of a motivated public sector.

They believe that slashing £36m from public spending in a hastily devised ‘restructuring’ is a good thing, despite the dangers to essential public services and to economic growth. Indeed they apparently don’t see any connection between public spending and economic growth at all, or at least they haven’t up until now.

But I detect a shift in emphasis by chamber as their leaders begin to acknowledge that rather than government getting out of the way of business (as one former chamber president advocated), government has a key role to play in helping the economy out of the doldrums.

The current chamber president has acknowledged as much in its latest newsletter. He notes that the Treasury Minister’s primary objective is to balance the budget, and he plans to do this by a combination of public sector savings, increased taxes and, ‘he hopes’, some economic growth.

However the newsletter says: ‘Chamber on the other hand is of the view that a greater focus should be placed on the last part of this list, an approach that seems to be working well for our colleagues in Guernsey, delivering both superior economic growth and lower levels of inflation on the back of a more diversified economy’. Regular readers of this column will have heard that before.
However, since that was written, the Budget has been published and chamber’s fears have only increased.

That’s because there are few signs of recovery, but there appears to be no ‘Plan B’ if the current strategy doesn’t work. Indeed the chamber president believes there should be a plan C, D and E as well.

Yet despite some acknowledgement that borrowing, for example, might help in some circumstances, the Council of Ministers are stubbornly sticking to Plan A. Now this either means that they are focussed or pig-headed, and I’ll leave that up to readers to decide.

What is clear is that the council appears to have run out of ideas. The fiscal stimulus programme probably did what it was intended to do – keep Islanders in their jobs. However while the Treasury Minister unequivocally calls it a success, the Fiscal Policy Panel says that it’s difficult to produce evidence one way or the other. And according to the chamber newsletter, one council member has described fiscal stimulus as a ‘consummate failure’.

I wouldn’t go so far as that but it certainly appears that there was little ‘stimulus’ involved even if some worthwhile jobs were completed.
But now the council appears to have shot its bolt, and there’s nothing new on the horizon to help stimulate economic growth other than a plea to have courage because everything will turn out all right and the economy will eventually swing back.

The economy, however, is unlikely to swing back unaided. An economic growth plan once its agreed, will probably be too little, too late, and while there has been some success in a skills strategy, it’s very hard to escape the conclusion that the States were pretty slow here as well.

IT’S not as though the States are bereft of assets of all kinds which could be used to stimulate economic growth much more quickly. It might not even take much to show that the States are serious about growing the economy and not just producing opaque reports. A small investment in the future could make a world of difference to others looking to invest.

What about the Waterfront, I hear you ask? Yes, indeed, what about the Waterfront? Wouldn’t a quick injection of public funds into creating something (almost anything) down there help to push along the long-delayed plans. It was interesting to see another former president of the Chamber of Commerce suggesting an Enterprise Zone for the Esplanade Quarter.

He also suggested easing the restrictions on J cats (which would need a fair amount of political courage), and also matched investment in new
economic growth using the Strategic Reserve.

Indeed even the existence of the Strategic Reserve is an asset that gives the Island a competitive advantage. We’ve been able to put this money aside while just about every other government is now struggling to make ends meet. But there’s not much point in having a competitive advantage if you don’t use it.
Then what about Fort Regent? It’s a huge site. Does it have to become an eyesore overlooking St Helier before the States do something to get more value out of it.

What about high-speed broadband for all, mentioned in this column last week? Wouldn’t some States investment make it happen quicker?
There are plenty of ideas around, some of them totally impractical, but it would be good if someone actually considered them rather than just sitting back and waiting for Plan A to succeed or fail.

What is certain is that everyone is now placing much more emphasis on economic growth and that will require investment, both public and private. It’s not a question of throwing money at a problem. Investment has to be targeted, although we shouldn’t shy away from doing it just because there’s a risk.

We also want to avoid more tax increases, some would say at all costs, although I would point out that we are still very lightly taxed. Like everybody else, though, I would like it to stay that way, but there are other more palatable ways of increasing States revenue than upping income tax. A greater emphasis on property and consumption taxes (yes, the dreaded GST), and the introduction of green taxes, would achieve more than just raising revenue, but once again, this appears to be too innovative for an Island that is being urged to think differently.

As someone in the chamber newsletter wrote when referring to Fort Regent: ‘What is needed is clear, decisive action.’ That applies not just to Fort Regent, but to the whole economy.