Chris Thomas

Aggregated information about pay and other terms and conditions is available, as you know.

There was never £95 million of external debt. As stated in the newspaper, “there were two loans of £50m and £70m taken out with Barclays by an MEA subsidiary, the Manx Cable Company Ltd .... which Tynwald went on to retrospectively sanction the loans, which were refinanced by government when they became due for repayment - Treasury advancing funds to the MEA which then repaid Barclays. It is that refinancing which forms a major part of the outstanding consolidated loans fund.” MUA has CLF loan. This internally borrowed money includes money which was used to pay off external bank loans.

The first new banking licenses were awarded in 2019, the first new ones for many years. Neither was for a Chinese entity. Please post what you think Minister Skelly said, when and where.

Yes. Please read article http://www.iomtoday.co.im/article.cfm?id=36487&headline=Debts%20of%20£570m%3A%20we%27re%20still%20picking%20up%20bill%20for%20loans%20affair&sectionIs=news&searchyear=2017. Confirmed by Google and IOM Newspapers in 15 seconds.

No. I am here to encourage truth. I will correct my memory if you can share with me reliable sources that show otherwise. We should all retract incorrect statements!!!

Thanks for comment and discussion. The link between wage and price inflation is part of economic theory, but I am not sure you can see the connection as clearly as you suggest. Also price rises of different things affect different income people and households differently depending on different consumption patterns. Finally public sector pay negotiators have referred to higher pay rises in certain sectors in the Island’s private sector. In summary we both know this is complicated.

Yes, re CLF. In October 2017 Tynwald resolved that “Treasury writes off £95 million of loans to the Manx Utilities Authority from the Consolidated Loans Fund.” The unauthorized loan was paid off before then, from memory.

Thanks for comment. The bonds will mature but will not need refinancing as there is a bond fund to repay them. The unauthorized loan was paid off some years ago.

With respect, the statutory annual earnings survey of 2000 + people is more reliable than your personal experience. But you are right that average earnings in private sector have been under pressure, although median earnings not so much, and some in the private sector have had static or falling wages. Thanks for your comment.

What evidence do you have for the assertion you make about monetary inflation? I think there is quite a lot of money in the Manx economy. I was referring to cost of living. Inflation link to wage rises is the same whether they are private or public. You are right about collective bargaining difference, but I believe pay in the private sector is benchmarked extensively too which probably has similar effect.

The bonds cannot be paid off early, but there is a bond repayment fund which has around £70 million in it which will repay the bonds at their maturities in 2030 and 2034. Consolidated Loans Fund is internal, as you state. I do not know. But they have a good yield relative to current rates. It is not a mess. It is sorted with a financial, business and pricing plan. And the MEA failing 15 years ago was investigated with conclusions and some action for about 8 years thereafter. What is the point of going back repeatedly? You are right - the MUA bond repayment fund was formed from the Water Board bond repayment fund which was established first.

Pay rises in public sector are no more or less inflationary than pay rises in the private sector. And inflation has tumbled in the last couple of years when pay in the public sector has been agreed in a 3 year pay deal. Both private and public sector earnings pay tax and NI similarly.

PS Thanks for comments, and I will clarify or correct my comments when necessary and if I can.

No. There are external debts comprising £260 million of Isle of Man Government bonds on which MUA pays interest, and a Finance Lease for the gas pipeline. What I meant was that the £120 million of 'discovered' bank loans were paid off several years ago. As summarised in NERA's report in summer 2017: "Manx Utilities has two main sources of debt: £260 million of Isle of Man Government Treasury Bonds which were issued to finance substantive investment in water (£75 million) and energy (£185 million) infrastructure assets, and the Consolidated Loans Fund (CLF), which comprises a portfolio of loans drawn-down to finance on-going capital expenditure in the energy and sewerage businesses. The total borrowings on the CLF (as at financial year end 2016) were around £270 million. The interest rate on the CLF is determined by the Government on an annual basis; the rate from 1st April 2016 is 1.5 per cent, and 2 per cent from 1st April 2018. The two Treasury bonds have value at issuance and maturities as follows: Water: £75m bond at 5.625 per cent per annum with maturity date of 29 March 2030; Energy: £185m bond at 5.375 per cent per annum with maturity date of 14 August 2034. As well as the Treasury bonds and CLF, Manx Utilities has further debt instruments: a finance lease for its gas spur (which matures in September 2023), Local Authority loans, and Economic Development Fund loan, but these are far less material in terms of outstanding value. Figure 3.1 shows Manx Utilities’ current debt composition." In 2017/18 Treasury announced a debt reduction for MUA of £95 million http://www.iomtoday.co.im/article.cfm?id=36417&headline=MUA in weak financial position&sectionIs=news&searchyear=2017, alongside a utilities price freeze whilst the October 2018 MUA pricing strategy was prepared. Sewerage rate does not finance MEA electricity debt, but does finance substantial MUA sewerage infrastructure loan i.e. sewerage rate finances sewerage costs. The sewerage rate replaced the Treasury/Tynwald grant for sewerage. £70 million is about the size of the MUA/Treasury bond repayment fund. Either he mixed up words or the newspaper misquoted him I guess. I was not there. £260 million remains outstanding on the bonds as they are not callable, fixed maturity bonds, with no sinking fund etc.. The maturities of the two bonds are 2030 and 2034. The agreed pricing is for 5 years of inflationary increases, more or less. After that pricing is not yet determined.

Thanks so much for this analysis of the evidence. The facts should be beyond real dispute, but the analysis of those facts is of course variable and varying. I hope the topic I have started called “Lies, Damned Lies and Experts” can bring clarity to official statistics. Should I cut and paste your comment, and that of Roger Mexico, into this other topic? I am sure you know the Housing Market Review which was relaunched a couple of years ago https://www.gov.im/media/1366426/housing-market-report.pdf. I hope it is helpful and appreciate suggestions. As I mentioned on Manx Radio in early December, I hope ongoing Building Condition survey will be completed soon, so we will have up to date data about this aspect of private housing for the first time since 2007. Also hoping to update Census 2011 information about ownership/renting etc. in respect of housing. Any thoughts?