States accounts remain difficult to understand
I HAVE recently been reading comments on the subject of the States accounts. Although the Institute of Directors and Richard Digard say there are some improvements, they still find them extremely difficult to comprehend. In 2008 the head of treasury was given the task of bringing the accounts up to modern standards, yet they are still so muddled.
In fact so muddled that the president of the States' Trading Supervisory Board recently announced a loss of £6m. in the ports’ accounts due to capital spending. This is where the real problem is. We have to clearly distinguish between capital expenditure and normal trading profit/losses.
Nearly everyone agrees that demographics are going to cause an increase in social security and pensions. If this is the case then we should be considering making them totally self-funding by increasing contributions.
A major benefit of this revenue raising is that it can be structured to making the wealthier taxpayers pay more. Having done this I doubt whether there will be a need to introduce a new tax, such as GST, which would really hurt the poorer people at a time when they are already suffering from high inflation and higher mortgages. These two factors are really outside our control as they have been caused by global events. We must reduce our capital expenditure on non income-producing ventures and wait for a general economic recovery. It will give us time to concentrate on where we really need to spend capital. One that comes to mind is building affordable accommodation, otherwise our young will be forced to leave the island. The decision not to go ahead with the development of the Castel Hospital site is unbelievable. If it is to be kept, for whatever purpose, how much is it going to cost to repair?
TC Tilden-Smith
Les Landelles
Rue de la Foire
Castel