The public sector’s approach to investing public funds was transformed in 2021 with the creation of the States Investment Board, taking such direct responsibilities away from politicians.
The States has more than £3bn financial assets, £2.3bn of which is held on behalf of the Social Insurance & Long-Term Care Funds and the Public Servants Pension Scheme. Investment was last reviewed in 2015-16 by the then Public Accounts Committee, which concluded that funds were ‘appropriately managed’.
The Investment Board’s most recent report, from 2024, showed that the States’ two major investment portfolios both generated strong absolute returns and exceeded their inflation target returns, but fell short of benchmark returns.
Both portfolios are managed to seek to achieve a return of UK Consumer Price Inflation plus 5% over the long term – the target was 7.5% in 2024.
Scrutiny has said it wants to look into issues such as the current political oversight and governance of States Investments, the risk-reward appetite, and the levels of investment into social and environmental prospects.
‘This is a review we have inherited from the previous committee which we are determined to close out, because the governance of the States’ investments, which are substantial public funds, is too important to leave unfinished,’ said Scrutiny president Deputy Andy Sloan.
‘There have been questions raised about whether the current arrangements provide the clarity, oversight and accountability that they should.
‘We need to understand the investment strategy and objectives, how they are derived and by whom, and that’s still not clear to me.
‘The consequences of getting this wrong are significant – it’s an area where we must have clear, transparent accountability.’
Scrutiny said it might hold public hearings once the consultation, which runs until Monday 1 June, has been completed.
Views are welcomed in writing to scrutiny@gov.gg.
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