Treasury chief hits back

Wednesday 06 July 2016

Treasury Minister Alan Maclean has issued a stinging rebuke to his critics, who say Jersey’s financial planners are turning their backs on the Island’s lowest earners.

Senator Maclean said some States members have criticised his department for failing to defend low paid workers in last week’s Medium Term Financial Plan (MTFP) – a 'mini-budget'which will be discussed, with a view to ratification, in September.

“Nothing could be further from the truth,” said Senator Maclean. “To say we are bashing those who are less well off is nonsense. If that was the case, why is 60% of the income tax collected in Jersey paid by the top 20% of earners?

“Also, 30% of households in Jersey pay no income tax whatsoever. These statistics do not suggest we are looking after the rich and being tough with lower income groups. We have had to make savings in certain areas, but these are prudent ones and based on very careful analysis.”

While income tax remains the same in Jersey, Senator Maclean has also been accused of using ‘stealth’ taxes, by introducing new charges through the side door.

“Again, I just cannot see where that is coming from?” he said. “There is nothing stealth about the Nursery Education Fund (NEF) or health charge as we have done it openly and completely above board. We have told people what we are proposing to do and there has been no attempt to hide anything.

“I would accept that some issues are not necessarily going to be popular ones. But take the NEF for instance. The introduction of means-testing for nursery school funding, starting at those earning £85,000-a-year, seems fair. We are not in the business of providing benefits for those who do not need them.

“We want to target our resources for those who are most in need. To this end, we have made substantial investments in health provision. In common with the rest of the world, we have an aging population that needs to be looked after, which is why we have concentrated on that area.

“We have also sought to deliver more resources towards education and again, I think we are absolutely right in doing so.”

Senator Maclean said sound economics are behind the MTFP – and accepts a degree of belt-tightening will take place.

He said: “We are planning not just for the short term, but the long term and in doing so we have to make some difficult decisions, perhaps some unpopular ones, but in terms of cutting benefits, those most in need will be protected as much as is possible.”

But Deputy Geoff Southern, of Reform Jersey, says a public meeting has been arranged for tonight (Wednesday) at the Town Hall, starting at 7.30pm – to discuss the MTFP.

Deputy Southern said: “Now that the final draft of the MTFP Addition has been published, there is not a second to waste in examining and analysing what impact the measures contained in the plan will have on the lives of ordinary workers and taxpayers.

“As usual, the release of the MTFP, which has been surrounded in clouds of secrecy, comes at the last minute, with only one States meeting remaining before government closes down for the summer.

“Reform Jersey representatives seek to explain what can and cannot be done to mitigate the worst effects of the redundancies, service cuts, user pays charges and increased taxes proposed by ministers. We are looking to establish what the public’s priorities are. Above all we must establish a progressive alternative to the health charge, which protects the highest earners.”