Developing the first radical overhaul of taxation in 80 years requires a lot of probabilistic, provisional thinking. So, when these changes are presented with unwavering confidence and in a too neat a package, I worry. Conversely, I would worry a lot less if those supporting the recent tax reform policy letter in part or in full would use phrases such as ‘I’m not sure’, ‘I don’t know what the numbers are based on’, or ‘I’ve changed my mind’.
For instance, over the weekend I noticed a deputy simultaneously claiming that he based his decisions on facts, yet was unable to factually evidence his claim that ‘more than half of Guernsey’s non financial businesses are expected to fall below [the registration threshold of £300k]’; or even point out where in the policy letter this could be found.
The ‘changing your mind’ part is especially important. Perhaps the hardest part of forecasting is knowing how and when to revise your prior assumptions and resultant conclusions as new information comes to light. As politicians become affiliated with a given position, they tend to form alliances around it, seeking positive reinforcement from others who think the same way. This can make switching a position more costly than it would be if they were solely concerned with making the most accurate forecast.
What the policy letter is effectively asking us to do is trust the author’s best guesses under varying conditions of uncertainty. It is, therefore, entirely reasonable and eminently sensible to ask whoever put the proposals together how they formed their conclusions with the information available to them at the time.
I say ‘the author’ because I doubt very much the author of the policy letter was an elected member of the Policy & Resources Committee. Recent responses, that questions over GST calculations have been delayed because a particular civil servant is unavailable, only adds credence to this theory.
Officers provide expertise and advice, no doubt, but elected members are ultimately responsible for the decisions made in the Assembly. And if answers to fundamental questions over tax reform appear dependent upon the availability of a single unelected official, islanders may reasonably wonder how deeply the detail is understood by those presenting the policy.
Admittedly, this perception may be unfair.
But perceptions matter, particularly when public confidence in government is lacking. At its heart, this issue is not about GST. Nor is it about one committee, one policy letter, or one set of forecasts. It is about a broader principle. Government should be prepared to be open and transparent. Committees should directly answer all questions put to them.
Whilst the tax reform policy letter is more than 170 pages long, it does not explain the main topics in much detail. And there is no denying that these topics need details, in part because that is where the devil lies, and in part because a certain amount of immersion in a topic will provide disproportionately more insight than what has been presented so far.
Over recent weeks, requests have been made for the modelling, assumptions and analysis underpinning the proposed tax package. The response has not been an outright refusal. But neither has it been a commitment to immediate publication.
When requests for information are delayed, when questions remain unanswered, and when publication appears continually just over the horizon, the nature of the debate changes. The discussion ceases to be about the merits of GST itself and becomes a debate about transparency.
That is an unnecessary and rather awkward position for any government to find itself in.
This is not a hostile question. Nor is it an unreasonable one. Most people’s preference, I assume, is for the more important topics such as this to be presented in a way readers can check out the results for themselves, rather than having to take the author’s word for it. Indeed, it is the sort of question most people would ask in any other context.
In fact, I fail to see how a debate over the tax policy letter can be properly conducted if key assumptions remain hidden from view. Especially when no explanation has been given for the decision to withhold.
The most calamitous failures of prediction usually have a lot in common. We naturally focus on telling a story about the work as we would like it to be, not how it really is. We ignore the risks that are hardest to measure, even when they pose the greatest threats. We make approximations and assumptions about the world that are much less accurate that we realise.
MyGov. The Revenue Service transformation. The electronic patient record and the various hospital build overruns. If past actions are anything to go by, government is not that good at prediction. Thus, it’s doubly important to see the workings underpinning the policy letter.
Again, the concern is not necessarily that it is wrong. It may be entirely sound. Yet if the initial modelling supports the case being made, releasing it would strengthen confidence in the policy letter. It would allow critics to test the assumptions, supporters to defend them, and deputies to make their decisions on the basis of evidence.
The alternative is less comfortable.
The States is approaching a decision with consequences that will outlast the current Assembly and all those after it. Before deputies are asked to cast their votes, there should be no hesitation in publishing the initial assumptions, calculations and analysis that underpin the case.
Have we been shown enough evidence to make an informed decision?
The question is becoming increasingly difficult to ignore.
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