Two-tier society for States 'haves'

GUERNSEY'S G4, an alliance of the Chamber of Commerce, Confederation of Guernsey Industry, Institute of Directors and Guernsey International Business Association, has united to demand that the States starts cutting its ever-growing costs.

They have done so because while many of their members and staff will have had direct experience of the worst trading conditions since the Great Depression, the island's public sector has never had it so good.

Not only are wage costs racing ahead of inflation, numbers, too, are spiralling as figures from Treasury and Resources indicate that it is boom time for civil and public servants.

While Guernsey's wealth creators and taxpayers struggle, many for survival, government is oblivious to what's happening in the real world and has made no serious effort to spend less.

Health and Social Services, as we have reported, wants to go further and spend money it does not have - a planned budget overshoot of £8m. that will cost every taxpayer an extra £177.

There is an immorality in what is happening. Firstly, government does not listen to islanders, who made it clear when zero-10 was mooted that acceptance of the new tax policy had to be on a shared pain basis.

Secondly, public sector staff and politicians are busy creating a two-tier society - those who create the money and those who spend it.

This week's debate on raising the retirement age to 67 and increasing social security contributions is about one thing: the high cost of building a pension pot. Yet Treasury and Resources believes employers should pay even more - as a form of tax - and says that the current 6.5% of employee earnings is nothing compared to the UK's 12.8%.

So it would rather drive firms out of business than tackle States expenditure.

Worse, however, is government's attitude to its own pension schemes.

While the OAP for islanders costs them substantially, it is a pale shadow of that enjoyed by the public sector, which they also have to fund. Yet while the gold-plated scheme for civil servants and other States workers is also underfunded, it is the taxpayer who is asked to bale it out.

This is a double whammy too far.