Guernsey wants joint review of Alderney funding arrangement
GUERNSEY’S 70-year-old agreement with Alderney, which sees it funding key services like the school and hospital there, is to be reviewed.
It comes as the larger island finds itself facing a rising bill as a result of the fiscal union – the deficit was £6.8m. in 2017.
Estimates suggest that benefit payments to Alderney exceed contributions by approximately £2m. to £2.5m. per a year.
The total per-capita funding deficit in respect of Alderney would equate to approximately £250m. for Guernsey, Policy & Resources has argued in a letter of comment on air transport licensing.
‘It is clear that a full assessment of the financial relationship between Guernsey and Alderney cannot be undertaken in isolation of the 1948 Agreement,’ said P&R president Gavin St Pier in the letter.
‘Therefore the committee is of the view that a comprehensive review would be beneficial in order to ensure that the terms of the agreement are appropriate and sustainable and to provide clarity on a number of aspects concerning the relationship between Guernsey and Alderney.’
The agreement sees Guernsey funding health, education, policing and immigration, and Alderney Airport, while Alderney tax contributions accrue to Guernsey.
In 2017, more than £10m. was spent on these transferred services.
The total deficit also includes £3.3m. in Aurigny operating losses, which are outside the 1948 Agreement.
P&R wants to initiate talks with the States of Alderney to establish a joint group to do the review. ‘It is anticipated that the 2019 Budget report will include an update in this regard.’
Maintenance of the Alderney Breakwater will not be part of the investigation because that funding obligation stems from Guernsey’s contribution to UK defence and international representation.
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