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He is someone who polarised views, and on whom most people have an opinion - but he is also someone who has never shied away from taking action. Now, he’s opening up about his time in the island’s most important economic roles.
Politics in Jersey is a funny thing - there is nothing which has so much direct influence on our everyday lives, but which, if the voting numbers are used as a guide, we take so little interest in.
It’s almost as if we expect our prosperity to just magically continue, come what may. As the last year has shown, the reality is that prosperity is fragile. Maybe we should take just a little more interest (er, like bothering to vote) in those charged with protecting it?
As Express’s sister publication, leading business magazine Connect, celebrated its 100th issue, we took the opportunity to ask the politicians who have been most closely linked with the business community through the last decade a series of questions.
Three of them – former Senator Alan Maclean, Deputy Susie Pinel and Senator Lyndon Farnham – all declined to take part.
But one of them did stand up to be counted (and accountable), and that was a man who has been perhaps the most closely linked to the island’s economic story, throughout the life, so far, of Connect: former Senator Philip Ozouf…
My first ministerial appointment started on 8 December 2004, as Minister for Economic Development – so as there had been no previous ministers, there was no desk or letter!
2008 saw the election of the island’s second Chief Minister (CM), Senator Terry Le Sueur, who nominated me as the island’s second Treasury Minister. The new CM made it made clear his long-standing belief was the need for the island to live within its means.
Any suggestions of putting medium-term, ‘unbalanced’ budgets to the States Assembly, resorting to dipping into reserves… it was made clear they were out of the question, as they meant, in his view, putting necessary decisions off.
Pictured: Senator Ozouf (far right) early on in his political career.
Over the years, and particularly during the time we had served together on the previous Finance and Economics Committee, there had been numerous calls to use the Strategic Reserve, known as the ‘Rainy Day’ Fund.
This fund, and other policies, had been the brainchild of the much-missed Colin Powell CBE.
The CM made it clear that, as most Treasury predecessors had successfully safeguarded the Reserve, and built ever stronger public finances for the future, together with low tax, it was very clear that this policy of prudence, and the private sector drive, should be continued.
It was made clear short-term fixes would not be welcome during his term, whilst Treasury was expected to be independent.
To underline the importance of prudence, and despite what were known to be challenging issues on spending and income, the CM memorably remarked that before he had left the Treasury on the second floor of Cyril Le Marquand House, to move up to the fifth floor, one of his last acts had been to change the locks on the Strategic Reserve, and to add an additional lock. Going forward, both keys would be required to open it!
He explained - in a serious but humorous way – that he might have accidentally swallowed his key, and it might take some time to find it!
My first day consisted of being advised that the Treasury officials had not hedged the risk of the 100 million euro incinerator purchase, which resulted in a big paper currency loss.
The second day I was asked to attend upon the States CEO, to be briefed on “revised financial forecasts.”
The new figures revealed sharply downgraded estimates of income due to the unfolding global financial crisis.
The forecasts were made worse with the revelation of likely, significant demands for increases in expenditure in health, additional costs arising from unemployment and for the first-time, realistic calculations of the scale of under-investment in social housing, and infrastructure.
After the revelation of these revised financial forecasts, the States CEO hinted that consideration could indeed - if re-election in 2008 was to be successful - be given to drawing from the Strategic Reserve to get through the next three-year term.
This would delay, or reduce, the need to make what were expected to be some tough and politically unpopular decisions on efficiencies, reductions in spending hampering economic growth, and not investing in capital projects such as housing, healthcare facilities (such as the shockingly bad mental health facilities), schools such as St. Martin’s Primary School, and flood protection in St. Helier.
Pictured: Even back then, it was clear the state of the island's mental health facilities needed addressing.
The solutions advanced by senior officials were given short shrift, as it was made clear that further papering over the cracks was unacceptable.
The States CEO willingly accepted the ministerial instruction that a policy known as a ‘Three Point Plan’ of wringing out all possible savings and efficiencies was to be pursued alongside boosting economic growth; and only if a deficit was still forecast, was it necessary as a last resort, to consider tax increases.
My second term as Treasury Minister commenced after not being the then Chief Minister Designate, Senator Gorst’s, proposed candidate.
The other CM candidate, Senator Sir Philip Bailhache (whom I had supported as CM) proposed me, and, in a four-way election, I was successful.
The then Deputy Le Fondré, and Deputy Southern, were both eliminated early, before a final run-off with the CM’s chosen candidate, Senator Le Marquand.
Afterwards, the Chief Minister-designate came and shook my hand, initially somewhat apprehensively.
I made it clear that we had worked well in the past, and whilst I was obviously not his preferred candidate, a collaborative working relationship was essential between the CM and Treasury, and that his leadership would be respected.
The nervousness quickly disappeared, and the partnership worked well.
The key to this was a common liking of Stephen Covey’s ‘Seven Habits’, including seeking win-wins and beginning with the end in mind.
Pictured: Although he ended up working very well with Senator Gorst, Senator Ozouf had actually originally supported Senator Philip Bailhache for the top political job.
During this term, the island faced a series of challenges including the loss of over 1,000 jobs due to losing LVCR, and increasing challenges in financial services such as the global (and sometimes unfair) pressure on the work of offshore centres.
It became increasingly clear that the financial services sector needed a revamp (including within government) and a re-focused strategy was required to ensure the sector’s survival.
Bringing in McKinsey to undertake a detailed examination of the sector was at the time controversial. But, ultimately, with the support of the CM, it was done, and its recommendations published and implemented.
So too was the idea of bringing in external consultants, Capital Economics, to calculate the value of the sector to an increasingly sceptical UK Government and media.
Their report was positive, and its contents explained in a series of planned media interviews including Radio 4’s Today, BBC News, together with articles in most UK broadsheet newspapers.
During this period, working closely with the CM and the External Relations Minister, the long-held objective of opening a Jersey Government office in London was secured.
No-one would probably imagine Jersey not having that office in London today.
Pictured: Jersey's London office has been very beneficial for the island, according to the former Senator.
Following the 2014 election, discussions were again held with Chief Minister Gorst, who asked in which office I would like to serve. The idea was that a new Ministerial position responsible for Financial Services, Digital and Competition would be created.
Somehow, at the last minute, ‘Innovation’ was added.
Despite having been successful in the first three areas - even though a ministerial post was not created as it was blocked by Scrutiny - it was the inherited Innovation Fund which attracted most attention, and, despite it today being clearly regarded as a success, the short-term ‘lightning rod’ of criticism took its toll.
Hindsight, they say, can be a great healer.
Despite the crippling financial crisis, all should be done to reposition the financial services sector.
As the Treasury discharged the duties as shareholder of the increasing number of publicly-owned companies, which included JT, I was determined to ensure JT invested into faster data connectivity i.e. fibre-to-the-home.
Save for the reforms the F&E Committee had made to create the C&AG, and create the Public Accounts Committee, the Public Finances Law had remained largely unamended for a number of years.
Pictured: Investment in data connectivity was deemed a priority.
Savings and efficiencies had been attempted in previous years, but it had become clear the process of annual budget allocations made the delivery of savings very difficult, with the States often agreeing savings in one year, only for them to be reversed the next year.
Added to which, departments whose budgets were only confirmed one year ahead, meant annual budget rounds were inefficient, and led to a culture of short-termism and uncertainty.
The Law was significantly amended to allow three-year allocations, and my own long-held ambition to create a Fiscal Policy Panel was also put into the Law.
It was an enormous privilege to mark the revised introduction of the substantially revised Public Finance Law, by inviting all five living Treasury predecessors into the Treasury, so they could mark what I knew had long been a collective goal.
All agreed that the changes were extremely welcome, and the visit was marked with a photo of all the predecessors and Deputies alongside the portrait of Senator Le Marquand, who it was hoped would approve of the changes.
The Waterfront, and its development, had long been controversial with endless criticism of inappropriate buildings and the upturned boat. It took months of argument, but eventually the States were persuaded to abolish the Waterfront Enterprise Board, and replace it with a new revamped States of Jersey Development Company: the results speak for themselves.
The low point was the controversy surrounding the Innovation Fund. The lesson being: don’t take on other’s half-done policies. And if you do, make sure you have responsibility for the officers doing the implementation – otherwise, it will end in tears.
Pictured: The Innovation Fund was a low point.
The high point was the success of the Fiscal Stimulus Plan, which lead to the combined success of years of work, politically leading the financial services sector.
The prosperity that this brought, by boosting incomes to all people in Jersey, left a legacy of stronger public finances that were in a better shape than when the job was started.
That the controversy of the Innovation Fund took an enormous personal strain on the person under attack, and those around me.
The loud hailer would go to the majority of people of Jersey who accepted that the island’s finances had to rebalanced by the introduction of GST – I ask myself where would we be without it today?
The gag would go to the doomsayers, who talked down Jersey, and constantly predicted the downfall of our economy.
The reality was the finance sector, which is now rapidly evolving alongside digital, has prospered, and led to the Island entering the difficult covid crisis in a strong position.
Firstly, re-establishing an Innovation Fund under the terms that were attempted in 2015, which ultimately succeeded.
Pictured: "The controversy of the Innovation Fund took an enormous personal strain on the person under attack, and those around me."
Secondly, advancing a bold, future-looking and long-term confidence boosting, Fiscal Stimulus Plan, which can secure a positive future against the backdrop of the changed world, post-pandemic.
As Cyril Le Marquand said: “Confidence is essential.”
That is the way to improve the living standards of all islanders.
The future can be bright if we learn from the past.
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