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A £90,000 review commissioned by the Government has concluded that one of the biggest blockages to business success in Jersey is… the Government itself.
The 'Barriers to Business' report examined data and views from local leaders in all sectors and identified eight key issues – two of which relate directly to Government interactions and administration.
Produced by Jersey Business and 4Insight, the report also noted that Jersey's economy is stagnating.
An area of particular concern outlined in the report was the Government's new procurement and payment platform, Ariba, which is used by all firms that supply the Government – from sandwiches and paper to fuel and technical expertise.
Pictured: The Government's IT upgrade was initially earmarked to cost £28m in the 2020-23 Government Plan, which increased to £40m in the 2021-24 plan, and then £62.5m in the next one.
The platform, introduced as part of the much-troubled £62.5m Government IT systems upgrade, allows real-time tracking of purchase orders and was expected to make payments easier.
However, when the system switch happened earlier this year, around 8,000 outstanding payments to suppliers totalling £22m were uncovered.
There new system itself has created issues, with businesses complaining of it being “slow” to use – one organisation said using it takes “five to six extra hours per week”, and that they had to send six emails before getting paid for one order.
“This equates to 16% of an employee's time which is unproductive,” the report said.
There were also “significant delays in payments being received for services provided”, with some businesses left waiting more than three months. The report noted this problem is “particularly acute for the smaller businesses who require prompt payment to manage their cashflows”.
Another organisation reported that they have 3.5 staff in finance solely focused on chasing Government for payments.
“It was stated that the new remittance system does not give a breakdown of the remittance, and thus needs the recipient to work out what the payment was for,” the report said.
Pictured: Import freight costs – which could soon increase following proposals by Condor to hike prices by almost 19% – were also cited as an issue by all sectors.
Survey results further revealed that the greatest challenges to businesses were staff recruitment and retention, a lack of vision from the Government, administration, and complying with Government legislation and registration.
Particular areas of concern related to policies on work and housing licences, opening hours, and an apparent lack of action in bringing "vibrancy" to the town centre. Import freight costs – which could soon increase following proposals by Condor to hike freight prices by almost 19% – were also cited as an issue by all sectors.
The report doesn't only point out the 'Barriers to Business'. It also includes 20 short-term (before the end of 2024), nine medium-term (before the end of 2026) and nine long-term recommendations (beyond 2026) for the Government.
Among the recommendations was a review of the implementation of the new Ariba system "from a supplier perspective" to "ensure that it is simply and easy to navigate", as well as provide additional training to businesses.
Pictured: Deputy Kirsten Morel said work was already underway to address the recommendations of the report.
The report said: "Businesses volunteered their time to take part in the consultation on the understanding that their voice would be heard."
Failure to listen and act, the report continued, "will reinforce business opinion that the Government cannot be trusted".
Economic Development Minister Kirsten Morel said that some recommendations "are already being addressed".
He added: "However we cannot rest on our laurels and in 2024 I will be working with other Ministers to take forward the recommendations to remove or reduce barriers, enabling Jersey businesses to start, to grow and to flourish."
Of 235 respondents, 65% said "staff recruitment or retention" presented a challenge to their organisation
58% said that there was a "lack of vision or understanding for your industry by Government"
30% also selected staff recruitment and retention as the "greatest challenge"
The full Barriers to Business report can be read here.
Follow Express for more analysis of the report in the coming week...
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