I was recently watching an interview with American author and economist Thomas Sowell.
He made a comment that resonated with me: ‘People get attached to visions’.
This was in the context of a discussion regarding how we all tend to overlook (at best) or ignore (at worst), facts that do not conform to our beliefs – howsoever we may have come to give credence to them in the first place.
The same is undoubtedly true of popular narratives and while historically we may have been considerably influenced by upbringing, family, friends or perhaps news media – today, social media is a far more powerful influence on popular beliefs, (if it’s on Facebook it must be true). So, it is increasingly difficult to separate fact from fiction and this can sometimes have considerable consequences – such as when election time comes around.
Depending on your own personal circumstances, I imagine most islanders would agree that Guernsey is a special place, but particularly expensive.
Consequently, I think it is probably fair to also say that the rising cost of living (particularly housing) and likely tax increases were the top two issues on the doorstep for candidates in our recent election. Importantly, how you may have perceived the reasons for these challenges – and equally how candidates may have explained their position on them – will have influenced your voting choice.
But within the context of the influence of popular beliefs or narratives that I referred to above, can you be confident that our new Assembly is now equipped to be able to address these key election issues successfully?
The civil service is the problem
The more often we hear an idea espoused, the more we believe it to be true. It is also more likely that those who offer (seemingly) simple explanations for complex problems are more likely to be believed. On top of that, there is a phenomenon known as mimetic theory which encompasses ‘scapegoating’ in which the community can unite against a single group (or individual) to take the blame for social discord. So, it is certainly a popular position to claim that the civil service, or the public sector more generally, is ‘too big’, ‘too powerful’, or ‘wasting money’. Given the size and diversity of the public sector, there will be an element of truth in some of this. But can it really be true that our shortage of public funds and escalating cost of living has any single cause? Who or what – is really to blame?
An island economy or modern economy?
As a member of the last Assembly and with the added insight of being on P&R for much of that, I believe I have a reasonable grasp of the realities and challenges we face from ‘inside the tent’. On a number of occasions, during various debates, I would hear the phrase ‘a modern economy’ which usually prefaced a claim that we should have (or expect to have) X, Y or Z. Generally speaking, this would be some service or provision that was available in the UK or occasionally Jersey. To me, this was nonsensical. If you want X, Y or Z, surely a prerequisite is that you can actually afford it – not just because it is available elsewhere. We would not expect Alderney to have the scale to support much of what Guernsey has. Similarly, why does it follow that we can expect to have all that the UK has either? Nor can we necessarily have comparable services at the same cost or price. We simply do not have the economies of scale – but there is certainly an expectation.
Expectations
The undoubted success of the finance sector has certainly improved the standard of living for many over the last few decades. But a by-product has been the raising of expectations about what should be available to islanders. This is regardless of the fact that we are sub-scale for the provision of almost everything – like healthcare and diverse connectivity. Certainly, the improved standard of living for a proportion of islanders largely employed in or servicing that sector has increased calls for support to islanders who are not so fortunate. As an example, the 2026 Budget identifies that income support (provided to those in work who are still struggling), is a sizeable £61m.
Nevertheless, it is often touted that because we have a particularly high GDP, we are a ‘wealthy island’. But it certainly does not follow that a high GDP means most islanders are wealthy. Far from it. Yet we are committed to spending over £5.6m. on overseas aid next year, (despite the fact that we have an increasing number of homeless people), tied to a percentage ratchet of said GDP. That is a result of an Assembly decision two terms ago. Again, not based on affordability but part of what I believe was addressing ‘Guernsey’s place in the world’. Quite frankly, this was simply virtue-signalling (in my opinion) – given we already had an escalating structural deficit. In fact, the recently published 2026 Budget proposals make it quite clear that we have been on this deficit trajectory since zero-10 was introduced in 2008. But since successive assemblies have not grasped the nettle and despite several tax debates in the last 10 years – we are ever deeper in the deficit mire.
Demographics
I am going to go out on a limb here and make a very bold claim. Guernsey cannot currently afford its future. The huge increases projected in servicing the healthcare needs of an ageing population, let alone the increasing deficit balance between those paying into the system compared to the amount of people taking out – is simply unsustainable, That is nobody’s fault and it is repeated across almost all jurisdictions other than places like Nigeria and the USA. But we have known that this demographic issue was coming for some time. Successive assemblies and committees have been made aware but have chosen to avoid making some very unpopular decisions to try to address it. Certainly it was the genesis for exploring tax options (again) last term; the justification for an agreed increase in contributions for 10 years and the introduction of a secondary pension scheme – but best not add the unresolved long-term care costs problem which exacerbates the mix.
So, is government fit for purpose?
Way back in 1998, the then-States commissioned an investigation into whether the pertaining system of government was fit for purpose and what alternatives there might be. At that time, we had been generating healthy surpluses, deputies were largely unpaid and our demographic pyramid was still the right way up.
It ended up being known as the Harwood Report given Advocate Peter Harwood was the chair of the panel tasked with the review. It was very comprehensive and took about two years or so to compile. Many stakeholders were consulted and I cannot do justice to what is a very extensive body of work here, but in Section 8, paragraph 12: ‘Many of those who submitted representations to the panel cited the lack of co-ordination and cohesion in the machinery of government in the island as being of paramount concern. This view was particularly strongly expressed by some of the senior civil servants who gave evidence.’
So even 27 years ago, it was apparent that our system of government was not adequate to deal with ‘big picture’ stuff. Now, although the States did not accept many of the proposals in the review, in 2004 they did enact some changes which reduced the number of deputies and committees. But by 2012, a second review was undertaken (possibly in light of the challenges introduced by zero-10). That resulted in the system we are now operating under with even fewer deputies and consolidated committees.
Last term, an attempt to further reduce the amount of deputies by 10 was defeated but with a commitment to review again this term. Which reminds me – Christmas is only about nine weeks away and I suspect most turkeys won’t be voting for it.
The committee system we have provides for relative autonomy under the various mandates but the final arbiter on the use of resources is the 40-strong-member assembly. In practice, this means getting 21 deputies to agree to anything, and despite that meaning that 19 deputies may not agree it is still termed ‘consensus government’. But in reality (and I speak from experience), anything contentious never ends there and gets revisited by one means or another, time after time. I would suggest therefore, that our current ‘system’ contributes to a clear inability of the assembly to work efficiently, decisively and effectively on Guernsey’s ‘big picture’ or indeed prioritisation of key issues or resources.
So it is no wonder that island-wide challenges such as our acute housing situation, or the fact that we are running a massive £77m. deficit are proving very elusive to resolve. But the people who are responsible for coming up with a plan are our elected deputies – not the civil service.
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