Jersey Considering Cut-Back Proposals

by Jason Gorringe, Tax-News.com, London

19 September 2011

The Jersey government has submitted the 2012 draft Annual Business Plan to the island's legislative assembly The States of Jersey for discussion. The Plan focuses on 3 areas: cutting government expenditure; generating economic growth; and ensuring a competitive tax regime, which is flexible to public finance needs.

Welcoming the debate on the Plan, which in particular looks at cost savings, Chief Minister, Terry Le Sueur, said:

"We welcome an informed debate on the Business Plan. If we are to continue providing decent, reliable services while ensuring value for money for taxpayers, we need to fundamentally modernise our public sector. I hope Members will keep this in mind as we prepare our island for a long and difficult road to recovery.”

Treasury Minister Philip Ozouf added that: "Ministers remain committed to delivering the government's savings target of GBP65m by 2013.”

“As well as departmental savings, we are working hard to reduce staffing and procurement costs across the public sector.”

"This Business Plan begins the process of making fundamental changes to the way we deliver some of our services. It keeps in mind the current economic situation and proposes changes which will put our financial management on a more sound and transparent footing."

The Plan also examines the economic outlook for Jersey over 2011-2014, and contains comprehensive savings proposals scheduled for 2012.

The Jersey government has already made a number of difficult decisions on tax policy. This has included a 2% increase in the Goods and Services Tax to 5% and an increase in social security contributions from employers, aimed at contributing around GBP60m annually.

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