Guernsey Press

P&R boss faces bond questions

GUERNSEY'S top politician will be quizzed on why there was such a 'rush' in the issuing of the States bond after an independent review found a number of concerns with the consultation and due diligence of the set-up process.

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The report, compiled by KPMG and commissioned by the Scrutiny Management Committee at a cost of £46,000, makes a number of recommendations and raises some questions for the former Treasury and Resources minister Gavin St Pier and his peers.

A public hearing has been scheduled for July.

Its findings include:

An inconsistency between what was calculated by EY and what was quoted by Deputy St Pier in respect of break costs on existing debt.

The due diligence appeared 'very limited in practice' including the States trading bodies having 'very limited correspondence' with the States.

One body, Guernsey Electricity, saying it has a more favourable rate for its planned investments using commercial borrowings.

No exercise being completed prior to the issue to compare the current rates with those the trading bodies could have achieved in the commercial market.

The States have breached the rules of the Fiscal Framework by borrowing in excess of 3% of GDP in one year.

A lack of detail being released when Deputy St Pier answered questions in the States about the bond issue.

A lack of a detailed plan regarding the ongoing management of the funds.

Scrutiny president Chris Green, pictured, said the bond issue was the committee's first major evidence-led review of this term so far.

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