The business organisation said it had presented proposals to deputies last month which presented an opportunity ‘to develop a more ambitious economic strategy that supports entrepreneurship, encourages investment, and enhances Guernsey’s attractiveness as a place to live, work, and do business’.
It said that any measures to secure the island’s long-term public finances were matched by policies that did more for the local economy.
The group said that it recognised the need to address Guernsey’s long-term fiscal challenges and maintain sustainable public services, but believed that the island’s future prosperity would depend not only on how revenue is raised, but also on how economic activity is encouraged and supported.
It said it welcomed some aspects of the proposals, including recognition of the pressures facing retail and other consumer-facing sectors, but said it wanted the conversation to switch to economic growth and encourage more spending on-island.
‘Our central concern remains that the proposals are framed too narrowly through the lens of taxation and revenue extraction alone,’ said GRG director Malcolm Woodhams.
‘Fiscal sustainability cannot be secured solely by broadening and deepening the tax base if the same policy package weakens consumer confidence, suppresses local spending, reduces business investment, and does nothing to address the substantial economic leakage off-island.
‘Every pound spent locally works harder for Guernsey. There is broad recognition that money spent with on-island businesses generates a significantly greater return, with every £1 spent locally estimated to create around £1.40 of local economic value through re-spending across local businesses and supply chains.
‘When local businesses succeed, the benefits are felt across the wider economy. It should be a top priority for government to address the substantial level of economic leakage. We have consistently been calling for practical measures, including incentives for business investment, improvements to town centres, productivity initiatives, and policies that help local businesses remain competitive.
‘If Guernsey wants stronger public finances in the future, it must also focus on strengthening the economy that supports them. Local economic growth and fiscal sustainability go hand in hand.’
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