Stuart Falla sets the stage for the annual IOD debate by asking how the burden of running Guernsey services should be shared

October 8th, 2011 by Stuart Falla

I’m looking forward to being involved again in an IOD debate. A sequence that Tony Carey and I started all those years ago.

The simple principle behind the early Guernsey Institute of Directors debates was to stimulate debate on the issues of the day. Stimulate debate by those that had been asked to participate, those that attended in the audience, and if ideas developed further then maybe they would be debated in the corridors of power. That is by those that can actually make things happen.

I’ll leave it to you to decide if that last comment refers to civil servants or politicians.

Stuart Falla MBE moderated the 20th Annual Guernsey Institute of Directors debate at Beau Sejour Leisure Centre on 6 October 2011 (click image to expand - ©RLLord)

Before we start we need to clear up a few things about the subject matter and terms that we might use this evening.

Are we sharing the burden together?

Let’s try to position this concept of burden.

Do we mean a burden that has recently come into existence as a result of recessionary pressures, something that might be called a transient burden, or are we referring to the burden that the tax payer carries as a result of us all acting collectively as a community – if you wish you could call that our permanent burden?

This permanent burden, which could be reduced, has nevertheless grown and grown in recent times for a whole variety of reasons.

There are signs that this growth has started to be arrested but it is early days yet.

Life and the economic outlook maybe appear even more burdensome because of the recent financial crisis.

But what is this burden and have we got the balance correct in Guernsey?

The balance of how much we expect the State to carry of the burden and how much non-state organisations might be capable of bearing themselves.

Capable because in some circumstances we are better placed to meet that challenge and perhaps more experienced.  Or simply, it could be that we just like to contribute.

This evening is about what we can do as business people either through our businesses or what we can do ourselves. Because we choose to; not because we are obliged to.

Has Guernsey got a burden at all?

Living and working in Guernsey for the last thirty five years it doesn’t seem like we have had much of a burden at all. During the last few years after the introduction of zero-ten the burden has increased for some but it has decreased for others.

And as for the recent financial crisis we do not seem to have suffered anything like the UK or like Europe or like the USA.

We haven’t really been in recession and have not seen significant unemployment in any of our sectors.

Guernsey has survived well and hopefully it will continue to do so.

But can be afford to ignore this burden faced with uncertain times?

There is no clarity in respect of changes that might be needed to zero-ten tax regime on corporate taxation and there is little clarity in respect of the new Housing Laws and the effects that any new law might have on employment licences and on the Open Market.  And where is the Euro destined to go and what is its fate?

The burden might get worse in the future as a result of these unknowns and may get worse as a result of the unknown unknowns.

But we are here this evening to talk about the known burdens.

Any community that chooses to do things and organises itself collectively must eventually pay for that collective action through taxes, levies or fees. This might start with defence and law and order, provisioning an army and a police force; constructing roads, harbours, prisons, schools and hospitals.

Modern society has taken collective action to a new level and introduced a whole list of rights that eventually must be paid for by the tax-payer.

We like life to be fair and we are very good at introducing laws to prevent unfairness but every new law adds to the existing burden.

But are sharing this burden fairly and responsibly?

Guernsey’s current system of distributing its burden between the State and non-state organisations has developed without any planning and without any thought of the consequences.

In the meantime, the UK has been quite aggressive over the last decade or so in ensuring that it does not bear any burden that it could properly distribute back onto Guernsey’s collective shoulders.

Just look at our reciprocal health agreements, higher education fees, defence that resulted in the Alderney breakwater being taken on, and more recently a revised double taxation agreement.

We must look at our own distribution of burdens. And I am not suggesting that we should pass burden on to Alderney or Sark as this is for politicians to decide. And the best of luck to them for that one.

But surely as a community we should reconsider whether the State is the right organisation to provide and operate all the services that the community needs to become a better, stronger, healthier and happier society.

The Health and Social Services Department (HSSD) and their 20/20 Vision have set the right path but there is more that could be done.

In my limited experiences I didn’t feel that the States were inefficient nor necessarily over-staffed. I did think that they were often doing things that they didn’t need to do, and maybe shouldn’t be done at all, or perhaps those things could be done by someone else who was better suited to that task.  Yes, they occasionally spent money unwisely and they could have diverted that money to a better use elsewhere but then that is a political call and that is why we call our members of Parliament ‘Deputies’ for they deputise for us.  They exercise their political wisdom on our behalf in the spending of our taxes.

But should they build and operate an incinerator? Should they exploit tidal power themselves? Should politicians direct civil servants to run and operate the dairy, the airport, the harbours? Should postal services and electricity generation be profit making businesses or should they be more similar to the Guernsey Housing Association, which  is set-up as a not-for-profit organisation.

Can companies and company executives do more within our community than they currently do or do you have to elected as a Deputy to be able to contribute your two penny worth to your island?

Deputies are good at making laws and they love regulating. They are good at setting up frameworks. They are good at interfering, hopefully, wisely.  But they might not be the best people to run things.

Is there a better model?  Should we investigate?

In tonight’s Guernsey IOD Annual Debate we are going to try.  We are going to consider not what the States can do for you but you can do instead for the State.

How do you exercise your wisdom on behalf of your community rather than rely on others to exercise it on your behalf?


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