11 November 2009
Jersey’s Treasury and Resources Minister agrees with the concerns of the Fiscal Policy Panel about recent spending decisions made by the States.
In its latest report, the panel expresses concern that the States has decided to spend extra, unexpected tax revenue, rather than saving it to support the economy in the future. However, it has also described efforts to strengthen controls on public finances as encouraging.
Senator Philip Ozouf said, “I share the concerns of the Panel about the structural (permanent) deficit and the importance of planning now to deal with it once the economy recovers. This deficit is manageable and not on the same scale as the deficits faced by many other jurisdictions, but it does need to be tackled. I believe that the Fiscal Strategy Review and the Comprehensive Spending Review are both critical if we are to meet the Panel’s requirements to keep States finances on a sound medium-term footing.”
The Minister has also noted that the panel supports efforts to inject cash into the local economy in the short-term, given that Jersey is likely to be in recession this year and next. The Panel has endorsed the fiscal stimulus package as a way to ensure that money released from the Stabilisation Fund is spent in a timely, targeted and temporary manner on projects that represent value for money and are of core value.
The Minister added: “The processes we have in place which govern the release of money to stimulate the economy are in line with the panel’s advice, and meet the twin objectives of helping the economy through the downturn and not adding to the structural problems Jersey faces. At the same time we will be paying close attention to the medium-term challenges and progressing rapidly with work on the Fiscal Strategy Review and Comprehensive Spending Review.”
Fiscal Policy Panel report
gov.je