OPINION: Balancing act

How can States members debate the island’s finances without proper accounts and the ability to understand them, asks Lord Digby Jones

(Shutterstock)
(Shutterstock)

IT’S been an interesting few weeks since I last made a contribution to the pages of this august publication.

Yesterday I was sitting atop the cliffs between Le Gouffre and Petit Bot, happily intoxicated by Guernsey’s scenery and nature’s raw elements, gathering my thoughts with this piece in mind.

Our island needs to raise cash to plug the deficit. Various options have been put forward. For what they’re worth, here are my suggestions:

Surely no one can argue that urgent steps need to be taken to give deputies an understandable set of accounts of the island’s finances. The existing accounts are frankly a mystery. Our island’s financial records should follow normal accounting rules and provide a conventionally-prepared picture of cash flow, balance sheet and income/expenditure. How can States members vote on measures to remedy a problem when virtually none of them will be able to understand the accounts?

Every deputy should be required to attend a course on the fiscal aspects of public finances. It would cover the vital distinction between structured deficits and current account indebtedness. They would then understand that borrowing to spend on long-term projects to be repaid out of future growth and inflation-affected revenue is a world away from raising money for the here and now or indeed for future calls on current account spending such as social care.

All those taking part in the current debate must appreciate the realities and practicalities of successfully raising extra cash in a globally-competitive environment where both personal and corporately-invested capital funds are intensely mobile. The correlation between the rates and nature of taxation, the actual cash collected and the continuing happy and satisfied presence in the Bailiwick of the internationally-mobile wealthy taxpaying group of islanders would be much better understood.

Playing populism by trying to appeal to the 60% of the population who pay 25% of the island’s tax take by squeezing the 5% who pay a similar amount is the irresponsible politics of the mad house. The absence of taxes on capital, be they a wealth tax, capital gains tax or inheritance tax, attracts the wealthy who then spend on the island and stimulate growth, let alone already pay a sum equivalent to the current £75m. deficit all on their own. We need to make our island more attractive to these people, not less.

Introducing a goods and services tax at points of sale at rates of 5% or 8% has been suggested. The problem with this is that once introduced, the island’s reputation for ‘no VAT’ will be gone forever; even if it was subsequently repealed, the perception (and loss of attractiveness) would stick. And once politicians get their fingers into a new cookie jar they rarely replace the lid. Moreover, a sales tax affects the poorer in our society disproportionately and it is also inflationary.

Levying a 3% rise in income tax is suggested. This would be hypothecated to paying for the health and social care issues of an ageing population. We should rejoice in the island’s longevity and encourage fiscal measures that deal with its increasing cost – we will all get old one day.

A 23% flat rate of income tax is still highly competitive internationally and the actual cash produced will be enhanced by attracting more wealthy people to the island; the 3% part should apply only to incomes over £30,000 a year so that the lower paid will enjoy the benefit the increased cash injection will bring without actually paying for it, a hallmark of progressive taxation which will find its supporters in the States.

My taxation musings on the cliff-top floated further afield as I reflected on the football club I have supported for decades (as a Brummie, why wouldn’t it be Aston Villa?) selling its star player, Jack Grealish, for an eye-watering £100m. That figure would sort out our deficit and then some. Given that this profligacy will never end and Premier League clubs and their players affect to support issues of social conscience, why doesn’t Uefa (or Fifa for worldwide implementation) levy a 1% tax on all transfer fees, with the cash raised helping to pay for the coronavirus vaccination of the poorest parts of the world or the provision of clean water in the world’s poorest communities? Just a thought. Hey, officialdom. If you really care, as you say you do, get it done.

The scandalous behaviour of Deputy Le Tissier has finally been dealt with by his fellow States members. Their vote by 25-5 in favour of his suspension from the States for one year without pay left me wondering what exactly you have to do to get fired from the place. Moreover, there are obviously but worryingly five members of our democratically-elected body who thought that a deputy anonymously abusing people on Twitter doesn’t warrant suspension.

I guess there will always be, in the miscreant’s own words, ‘preternaturally stupid’ people doing preternaturally stupid things. But surely those we elect to govern us care enough about the maintenance of the standards they promise us they will uphold that immediate changes in ‘the way things are done round here’ can be implemented to ensure the farce of the past weeks isn’t repeated.

Is it a good thing that the ruling of the independent States Conduct Panel can be overruled by the deputies? Surely that drives the proverbial coach and horses through the safeguards for us all of the doctrine of the separation of powers. ‘Beware the tyranny of parliament’ is a warning that should be constantly heeded and the procedural rules should be changed forthwith.

I understand that one impetus driving the votes against and the abstentions was the concern that expulsion would lead to an expensive by-election. One simple and speedy change of the rules fixes this problem – make it clear that in the event of an elected deputy being unable to continue in post, then the candidate at the last election who came 39th is offered the job. If she or he doesn’t accept, then the invitation is extended to the 40th on the list and so on.

This paper carried, over a few days, some well-articulated views on the curse of social media and how to deal with the appalling abuse in which its anonymous perpetrators can happily indulge.

It was great to welcome to these pages Daisy Doardo as a contributor to the debate. I would just observe that men do not have a monopoly on the venomous, misogynistic, disgusting and anonymous messages on social media.

Horace Camp reminded us of the rough and tumble of the public bar that is ‘the platform in the market place’ concept of social media. And Deputy Gavin St Pier reminded us that among the online hate and condemnation, we all have to learn to laugh at ourselves. But surely there are limits.

The authorities have thankfully tracked down many of the people who allegedly sent such racist filth out over the social media waves, specifically directed at three young black guys who just happened to have a bad day at the office. One hopes, if they are found guilty after the application of the Rule of Law (not the self-serving, non-juristic Rules According to Zuckerberg), that they are banged up for a long time.

But what about the dreadful abuse of people (especially women) tolerated on social media every day? Stuff that would not be tolerated in Horace’s public bar and at which Deputy St Pier should not learn to laugh? People moan about it; they are shocked when they learn what goes on. But nothing is done about it.

Only 20% of the UK population uses Twitter; but the media of all forms make up a goodly chunk of that number and through them ‘Twitterstorms’ develop a wider audience. That is not, of its own, a bad thing but what is never seen (and is, by inaction, condoned) is the awful, foul and often threatening abuse that sick people sitting at their keyboards dish out. They abuse and threaten in ways that no market square, no public bar would countenance; indeed they would be instantly locked up for it; that is, if they got out alive from the ensuing fracas their appalling behaviour would cause.

So let’s see some action. We can’t depend on appealing to people’s better nature.

If the authorities, with the cooperation of the tech giants, can thankfully track down so quickly racists who abuse black footballers, why can’t laws be passed right now enforcing such cooperation in all instances of filthy and/or illegal abuse? How Facebook can think it’s OK for their ‘independent’ panel – the brainchild of Sir Nick Clegg, who is paid a seven-figure salary by... er... Facebook – to ban the former president of the USA (no matter how disagreeable his views may be) but allow other repellent stuff to be carried on its platforms is beyond me. But therein lies the really only sustainable answer to this recurring nightmare: urgently legislate to make all social media self-styled platforms accept the duties and responsibilities of publishers. The tech giants would have to check the identities of users and accept personal liability for content. The threat of chokey for Zuckerberg et al would do the trick. Deal with this insidious threat to the mental health of us all, even those who perpetrate it.

And so, as I sat on my cliff-top bench and reflected on these issues, I realised just how lucky we are. Guernsey has its issues for sure, but when I look out across the ocean at a divided and threatened world that has rarely seen such turmoil in peacetime, I count my blessings.

I can’t be the only one who watched last Thursday’s Channel News goodbye to reporter Gary Burgess with a lump in their throat. Gary said a wonderful goodbye to his viewers but, as he said, he will shortly be saying a tragically premature goodbye to life itself.

Now doesn’t that put our problems into some sort of context?

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