Scrutiny president Andy Sloan said that the decision to offer a sursis to political colleagues was taken during a presentation by P&R to deputies yesterday morning.
‘This amendment seeks to direct that P&R must return to the States with a revised proposed framework that demonstrably places at its core a clear fiscal principle, clearer and more realistic conditions governing borrowing, deficits and cash-flow management, transparent and coherent treatment of reserves, and strengthened, independent governance and oversight arrangements,’ he said.
Deputy Sloan has argued that the senior committee is ‘abandoning’ fiscal rules and removing hard constraints on borrowing, and that the island should take such frameworks seriously to restore credibility to public finances.
If approved by deputies, P&R will now need to come back by July with a new framework which sets out a clear and consistently applied core fiscal principle; the inclusion of clearer and more transparent constraints governing deficits, borrowing and cash-flow management, sufficient to enable prospective assessment of compliance; a coherent and justified approach to the treatment, accessibility and replenishment of reserves; and strengthened governance and independent oversight arrangements, including clarification of the role, remit and independence of the Fiscal Policy Panel, all arguments raised by Scrutiny in its original letter of comment.
‘In bringing this amendment, the committee is calling for a framework that provides clarity, coherence and robustness to operate as an effective constraint on fiscal decision-making,’ Deputy Sloan added.
‘The weaknesses in the proposed framework are not matters of drafting or emphasis, rather, they reflect more fundamental issues of structure, definition and governance that go to the heart of how the framework would operate in practice.
‘Given the central role of the Fiscal Policy Framework in guiding the long-term management of the States’ public finances, the committee does not believe it would be appropriate for the States Assembly to approve the policy letter in its current form.’
The proposal is supported by all members of Scrutiny, and is due to be debated during this week’s States meeting.
You need to be logged in to comment. If you had an account on our previous site, you can migrate your old account and comment profile to this site by visiting this page and entering the email address for your old account. We'll then send you an email with a link to follow to complete the process.