Beyond child’s play
If we want growth, then we have to seed that growth – and initiatives such as free childcare will do just that, says Horace Camp.
I’M NEVER one to turn down a handout and so my interest was piqued when I read that Deputy Roffey wants to give me an extra fiver a week from July.
Only a fiver because I don’t qualify for the entire £7 and change on offer because I don’t get a full States pension. I can get quite a lot with five, crisp, new Guernsey digital pound notes. But to be honest I don’t actually need it.
Although I grouse and grumble about every penny I spend, and live the life of a frugal hermit, I do in fact have sufficient funds to survive without Saint Peter’s largesse. I suspect there are many OAPs in Guernsey in the same position as me.
On the other hand there are many more who didn’t sell their souls to finance and end up as rich as a not-very-rich Croesus and could do with more than an extra £7 per week. This is the problem with equality. I, who have no need, must receive it for fairness. And by giving me money, Mrs Le Page doesn’t have to go through the trauma of means testing. However, Mrs Le Page may be willing to endure it if it means she gets my share and fellow columnist Digard’s as well?
There is a bit of a red herring here in that the boy Roffey will argue that the myth of a funded-by-contributions pension fund with an obligation to treat all members fairly is a reality. Funny that, eh? Especially when we are told that us old codgers have to be paid for by a dwindling number of young workers and that the fund will run out. In my reality the States pension is effectively paid out of taxes, the fund is a welcome fall back and the contributions are income tax by another name.
I’m focusing on the pension proposal to highlight one of the big failings in thinking of the States of Guernsey. As the final safety net for those of our community in need, we should reserve it for the needy. Yes, it may be fun for a bunch of wealthy people to jump the net for fun and giggles but it does mean that those who are falling out of 10th floor windows have to wait until it’s their turn to access the net.
It pains me to say it but, for once, President Ferbrache and I agree about something, although not for the same reason. Foxy wants to not spend the £2.5m. it will cost. I would prefer probably a smaller amount, better targeted to those actually in need of it.
I will take the money and stuff it under my metaphorical mattress where it won’t do a lot of good, while Mrs Le Page will spend it on hedge veg and send it on its way to multiply through our economy.
Just as an aside and as a homage to my A-level in economics secured unexpectedly in 1972 and still fresh in my mind, I wonder what impact the States hoarding money has had on our economy? Over the years the States has sucked money out of our economy and placed it in foreign lands where it cannot multiply for us at all. The pension funds of over a billion pounds. The unspent bond. Even the hundreds of millions of unspent infrastructure money.
I expect very little, if any, of it is positively impacting our economy.
For those not familiar with the multiplier effect of money, I will explain it here.
Once upon a time, there was a person named Le Page who had £10 in her purse. She decided to spend her money on an excellent locally made cheese from the Forest Stores, a nice piece of Fort Grey. The Forest Stores used the £10 to restock with Torteval cheese. Fennella, the cheese maker, decided to use the money to treat herself and so bought a fresh chancre from Troj, who had pulled it out of his pot only an hour before in Rocquaine Bay.
Troj, a fairly parsimonious Guernseyman, was ‘persuaded’ by his significant other to spend it on some famous Perelle sausages because she was sick of eating fish, crabs and lobsters day in and day out. The butcher had a penchant for Senners hot cross buns, so guess where the £10 ended next.
Mrs Le Page’s £10, a gift from the States of Guernsey, created £50-worth of local transactions and still had legs to travel even further. Imagine the constraints on our economy that have been caused over the years by the States just sitting on money?
And that leads me to more ‘free’ childcare. Imagine that £10 magnified many thousands of times entering our economy. And also imagine the new money being created by more parents being released into the workforce. Then imagine the multiplier effect of all that money as well.
If we want growth, then we have to seed that growth. The organisation with the biggest seed bank is the States of Guernsey and those seeds are doing little good sitting in dark vaults. Get them growing and the way to do that is to increase productivity by increasing the workforce from the resources we already have here.
‘Oh, but the deficit’ will be the cry from Deputy Helyar and the Ruling Coalition. I will answer with ‘n’ayez point peur, mon brave’. They like a bit of French in the Assembly. A bunker mentality is not going to help us now. As Ukraine will discover, a war cannot be won defensively. Time to channel.
Release the parents from their burden, get them into the workforce, increase productivity, create wealth, multiply that wealth and then do what you do best and tax the increased earnings. Low and behold, there will be no deficit. Cue the Ukuladeez singing Sarnia Cherie, the flag waving of the Last Night of the Proms and a spectacular dog-and-environment-friendly fireworks display.