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IOM finances in a really bad way?


PeterInCanada
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We are only just in this budget taking "a six year ‘long view’ to 2021-22, during which Treasury aims to slow and then stop drawing on reserves, which have plugged the loss of VAT revenue and the public sector pensions deficit."

 

http://www.manxradio.com/news/isle-of-man-news/budget-2016-teares-dose-of-realism/

 

Reserves are going to be consumed for SIX MORE YEARS!!! Despite Alan Bell himself commenting on the need to address the pensions problem in 2006 and, I seem to recall, mention of the pension problem from before that on Manx Forums.

Edited by TurricanII
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If you get it Peter in Canada then let us all in on the secret. The only thing I get is that it is virtually impossible to get an accurate figure from treasury as to our total budget deficit which is being hidden from us by using reserves.

 

If I were you if would take a round £100m as the figure you need for your calculation at the beginning of your post.

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The true figures will not come out until, maybe, a change of Govt and probably not even then. Reasons for all the subterfuge? Well, obviously there's a need to retain confidence in the Island as regards retaining what businesses we have left here. Announcing that the shit has hit the fan and we're bankrupt would not be good in that respect. But I don't think that's the big story.

 

I personally believe that there's another reason (conspiracy theory begins) and that is that we are currently in a "holding operation" to preserve things as long as possible at what will be the cost of the (probable) total use of the reserves. IoM has been a trough-fest for Tax Avoiders and upper echelons of establishment and Govt for at least the last thirty years. For some it's still fruitful and ongoing. It's not the sort of thing that can be, or would be, given up without a fight. And it's these groups who are being pandered to and preserved. Why else all the chicanery about reserves and the true position? Man in street wouldn't be bothered, most don't even know what's going on and have less interest, even if financial meltdown was announced, they'd just get on with their skint lives.

 

That trough was holed below the waterline after the VAT loss, it was unrecoverable. If it was recoverable do you really think that even our collection of hickys would have done virtually NOTHING about ANYTHING in respect of our Fiscal position in the last five years at least? A £200M per year loss and all we get is bit of token tinkering round the edges, nothing in particular done about PS Pensions issues, known about for at least ten years and costing close to £100M a year? But to do anything major would have a negative effect on the previously mentioned groups.

 

IoM Govt is caught between a rock and a hard place. 1/3 (VAT) income gone and a Low Tax Economy built on that VAT. But, as Sultan has posted, average wages are so low that even if they hiked income tax rates for the serfs it would bring in bugger-all. But Bell, in particular, won't touch tax rates for the wealthy or financial businesses. Note "won't", not "can't".

 

Why? Because he's in their pockets and operates for them. Coupled, possibly, with his proven lack of foresight. A couple of percentage points on their rates would mean bugger all to them (SOME have even offered to pay a bit more!) and might plug a couple of holes, but for many of them it's the principle and a way of life that won't brook change. So the show must go on, Allan. At any cost.

 

The reserves will continue to be raided, IMHO, until there's nothing left to scavenge. Let's just hope that there really is an extra billion stashed somewhere that we can chew into as well. That will preserve things even longer for the favoured few.

Edited by Non-Believer
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@N-B Interesting movie, will never get made with a pitch that long. Start with "Snakes on a Plane" or "Sharknado" length, and work up to a sentence.

 

I reckon the pitch is 2+1/2 terms or twelve/thirteen years in length.

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