Richard Digard: Talking of adult conversations...

Seven years ago I asked the question here: what’s the point of Aurigny? It wasn’t as provocative as it might perhaps first sound. Instead, it was to highlight a piece of work led by gentlemen called Trott, Falla and Sloan, who were looking to establish a position from which targets could be set to guide the airline’s performance and purpose.

The panel was firm in its eventual conclusions. Aurigny, as a government-owned airline, was there to assist the Bailiwick in achieving economic growth and development while ensuring adequate social and health links. Doing that would justify pumping taxpayers’ money into it.

The panel also felt that these two objectives were achievable and, if a sustained strategic approach was taken, then Aurigny could also move to a sustainable operating surplus year-on-year by focusing on increasing passenger numbers, rather than maximising revenue from seats sold, and by operating public service agreements to support and develop essential routes.

Well, seven years later, the ‘investment’ (losses to you and me) in Aurigny now probably exceeds £100m. – call that £3,500 each – its fares to London compare very unfavourably with Jersey’s and air passenger numbers declined by 12,000 to 894,000 in the six years to 2019. In contrast, Jersey’s increased by 242,000 to 1,716,000 over the same period.

In addition, its reputation for reliability is currently shredded, to the point where the former boss of Loganair was, straight face here, apparently randomly moved to write a spirited letter of defence in support of Aurigny. In turn, that triggered such an outpouring of love and devotion for our plucky little airline that I’m surprised people weren’t out in the streets banging pots and pans.

And that’s the text for today.

How impossible it is to have a grown-up conversation about almost anything without being declared a hater. In this case, of Aurigny and/or the case for extending the runway to make it more useful. Ask a critical question and, immediately, you’re beating up Joey.

So to be clear, I’m not being critical of Aurigny or of subsidising it. But it is sensible to ask whether that input represents value for money and is actually achieving economic growth and development. Come to that, it should be an obligation on government to demonstrate it’s using your money sensibly – and achieving clear and measurable objectives. As it is, we simply don’t know, the airline’s accounts are kept secret and what financial information is published remains, at best, opaque.

Some of these issues are inevitable. Aurigny is tiny, with limited resilience. Its management costs are proportionately higher than for a larger airline we could outsource to and its backup options are limited by the short length of the runway. Oh, and as touched on by the Loganair chap, access to spares is affected by running ATRs rather than 737s, again, a consequence of a tiny runway.

The other financial unknown is what the current wet-leasing arrangements adopted by Aurigny are costing. That’s the most expensive way of ‘borrowing’ aircraft, with hourly rates running into many thousands of pounds, and no indication of what that’s doing to profitability or losses.

Just posing these things risks accusations of disloyalty and the wrath of pot-bangers but while it was right to buy the airline in 2003 to secure access to Gatwick, is that approach still working today? In many respects, I hope it still is. But as things stand, we just don’t know. Worse, we don’t even want to ask.

What got me thinking about this was another topic that cropped up over the weekend – also triggered by Deputy Trott – after he said that average house prices should drop by a third, making a home more affordable at a notional £370,000.

The actual target, at least as defined by consultants employed by the States, is way lower* but that’s not the point. Wrapped up in all the work that led to it was another jaw-dropper that we’re also not discussing – islanders being slow to breed and slower to die mean Guerns face extinction.

To put that more scientifically, the recent average fertility rate of 1.4 births per female is well below the 2.1 births required for a break-even population replacement rate. As the report put it: ‘This means the population will decline, unless there is significant in-migration. The long-term lack of replacement means over time it will become necessary to augment the labour force and the tax base derived from employment.’

So for Deputy Trott to bring down house prices (I see he subsequently clarified his comments), we need to increase the supply, and that’s been put at 171 a year until 2040, by which time we should have 3,071 new units. The killer, however, is that figure doesn’t include those required for key workers (off-island essential public sector staff) or specialised housing (where a degree of support or care is provided to allow residents to live as independently as possible).

Put more simply, we need a crash building programme of a scale not achieved in the past 10 years or more. The homes that are built will go to people who are better paid than your kids and grandchildren or who work for the States, but the process by which this will magically happen hasn’t even been debated or agreed by the Assembly.

As Environment and Infrastructure president Lindsay de Sausmarez said in her foreword to the Guernsey Housing Plan 2023-2025, ‘These problems have been decades in the making, and the solutions too will take time to take effect.’ Well, yes, ma’am, especially since you haven’t even started yet.

Forgive the tetchiness but I’ve been writing about the island’s housing crisis for 40 years and over that time it’s only got worse. Pressure on prices has eased solely through recessions or – briefly – when then Housing president Deputy John Langlois sold the development known as Clos des Pecqueries to help match supply with demand.

Like boiling a frog, these things happen slowly. So in the 21 years it’s taken for States members not to question whether Aurigny’s working properly you’ve paid deputies a total of £42m. at today’s rates and not noticed a thing.

My serious point, however, is that when it comes to essentials like connectivity or housing – or even the size of government relative to affordability – experience shows you can’t rely on the States to ask the obvious questions, safeguard your interests or even provide enough social housing for its struggling citizens. That’s beyond disturbing.

Well, there’s an election looming, so how will you vote to break through this paralysis? In reality, you can’t. There is no way to do so under the island-wide, 38 independent-member system of inertia that we have. No opposition, no alternative view of whither Guernsey.

That, too, is alarming. So my prediction as we enter the countdown to election day is that we’ll start the new term in 2025 doing exactly the same things as now but hoping for a different outcome.

No, that’s not sensible. But unless the frogs suddenly start jumping, it’s inevitable.

* The actual figure is between £135,900 and £184,437 as I explained a year or so ago.