Launch of Guernsey Together bond has been pushed back

In the days before the election, its predecessor announced the bond would be launched formally in January with Ravenscroft appointed to manage it.

In May, the States backed an amendment to create the bond of up to £50m. for individual local investors to put money into.

P&R has said it is developing its plans for investment in the medium term and believes it is right to delay the launch of the new retail bond until it is clear what the use for any funding raised would be.

This is expected to be in the first half of 2021.

P&R’s treasury lead, Deputy Mark Helyar, said: ‘The Guernsey Together Bond has potential to be a positive way of generating funding for projects that can help in our economic recovery.

‘But we want to be clear about what specifically that money will go towards and how much we think we need.

‘We’ll have a clearer picture soon but until then we think it’s right to hold off on the launch of the bond.’

In the Budget, P&R made the decision not to put any more money in the capital reserve, which pays for major building projects.

There is currently £130m. in the reserve.

The Budget confirms that the States will fail to meet its capital target of spending no less than 1.5% of GDP per year averaged over a four-year period and 2% per year averaged over any eight-year period.

In 2019, the States funded £32m. of major and minor capital works (1.0% of GDP) from the capital reserve.

Between 2016 and 2019, the States directly invested an average of 0.8% of GDP per annum in the capital programme.

The Budget says that minimal capital spending is anticipated in 2020, largely as a result of the need to redirect human and financial resources to the management of the pandemic.