Budget's sting will need good arguments behind it

TODAY we find out if this States' pledges to have cut costs and become efficient really stand the test of public opinion.

The release of the 2016 Budget comes with a nasty sting for the public and business alike – and if you come knocking on taxpayers' doors for more cash, you'd better be prepared with a watertight argument to justify it.

Over the course of the next month, we will find out.

Treasury has unveiled some revenue-raising measures that have been signposted, and some, like the shock fuel duty rise, that have not and are maybe more unpalatable.

That said, an extra £3m. from the public is an extra £3m. whether it was expected or not.

There will be plenty of scrutiny of the request to spend an extra £8m. a year on Health and Social Services to keep things moving, especially given previous insistences of keeping downward pressure on its budget, but also some very uncomfortable questions raised by the fact £24m. a year could be saved in that area under a more efficient service model – just how have successive boards, Treasury departments and States let things get so far out of hand?

Treasury will be quizzed on the balance of the personal and corporate sectors.

It tries to sell this as a 50/50 split, because it ignores the fuel duty rise when talking about this balance, but the public still harbours grievances from the burden of zero-10 and might think it is high time that the scales tipped the other way.

Treasury hopes that the £20m. shortfall in revenue this year is cyclical. It has 'managed' this by cutting the equivalent amount of money being put into the pot to that used on major capital projects like schools.

That not only essentially busts an overarching spending commitment the States signed up to, it is very much a short-term move, as the department recognises.

A lack of capital investment not only leads to a crumbling public infrastructure so society suffers, it also has wider effects on those working in the construction industry and other sectors dependent on States investment.

If this is not cyclical, and the department has made some fundamental errors of judgement over its tenure, then taxpayers will be footing the bill for that in the longer term.

That's a crystal ball moment, so watch this space.

Treasury makes continual reference to the States not backing GST and the problems that has created in raising revenue, but it would do well to remember that that is only one side of balancing the books.

So let's get back to that promise of value for money and the faith we should have that the fundamental spending review begun in 2012 has achieved that.

The very least the person on the street who is being asked to open up their wallets can expect is that the States has delivered on value for money for the services it runs.

We know that the FTP, despite efficiencies, extra charges and some 'neat' accounting taking £28.7m. of public spending, fell millions short of its target.

We know too, from subsequent review, that the failing of cross-department working meant that an extra £5m. of public money is being spent every year that should not be.

And we know that Treasury has pledged departments would continue to save the money that they had so far failed to deliver.

So what has happened this year – have the departments made good on their promises?

We do not know. And that is one of the fundamental problems also identified when the Public Accounts Committee employed KPMG to investigate the FTP – the lack of monitoring means that original claims for savings may or may not be being frittered away.

It only looked at a handful of the projects, but noted that the Guernsey registry (£2.3m. of savings), air subsidy (£731,000) and higher education parental contributions projects (£912,000) all need continued monitoring to prove that they are delivering what the Policy Council has signed off.

The oversight seems to be slipping as time passes.

That combined with Treasury's bid to raise revenue at this time makes it even more fundamental that PAC's promised public hearings into the FTP go ahead as soon as possible.

The public need that proper reassurance that this States' legacy is not built on sand.

It does not help either that information requests by this newspaper for key documents around the decision-making process of the FTP remain stalled a year or so on despite assurances they would be answered.

Up for debate this week is planned reforms of the public sector.

It has not inspired much interest so far – some aspects of it are fundamental in improving public confidence in the work of the States.

No one likes paying extra taxes, but the pill is easier to swallow if you believe the cash is being looked after properly. Among the planned reforms is improved data collection, allowing much better scrutiny of what is happening for the politicians sitting on the boards and for the public when this information is released against set targets.

But that is for the future.

For the present Treasury is going to have to face up to a critical public and what might be expected to be a business sector that is equally as agitated by what this administration has done.