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56 minutes ago, Nellie said:

Agree with all of that.

A good start would be an Emergency Budget in (say) June, to supersede the one agreed last month, with the specific intention to start replacing some of the money which is being spent keeping the Island afloat for the next few weeks, and to start that cultural change, that you allude to.

I can immediately think of several wasteful schemes which could be binned: £8m Airport upgrade;  rebuilding the road to the South;  sixteen more new buses; silt removal; upgrading railway infrastructure. That's around £25m in a few seconds. Maybe even Castle Rushen school replacement needs to be kicked down the road. 

On top of that, hand down a significant cost cutting challenge to all the Departments, perhaps excluding Health, which will clearly need time to recover from this. This to be coupled with more focus on local spending to help recovery. For example, get rid of UK sub-contractors on the Prom, when it resumes. There must be many local firms who could have laid those paving blocks, which was given to an Irish firm.

I know there'd be a lot of bleating about capital and revenue spending being different, but, that's really just part of the CS smokescreen. At the end of the day it's all our money, and we need to spend it a lot more wisely, going forward. 

Don’t forget the £38m at Liverpool. 

 

How good an investment is that looking like now? Suck up any penalty clauses and sack it off before another spade is sunk in the ground.

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2 minutes ago, Derek Flint said:

Don’t forget the £38m at Liverpool. 

 

How good an investment is that looking like now? Suck up any penalty clauses and sack it off before another spade is sunk in the ground.

I think that little project may be part of our resurgence as a tourism destination. To drop it now would be very short sighted in my opinion?

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10 minutes ago, Max Power said:

I think that little project may be part of our resurgence as a tourism destination. To drop it now would be very short sighted in my opinion?

As much as I thought the whole thing was a short-sighted and ill thought out waste of money I do think we may see a resurgence of visitors to the island in the future, especially if Greta and her cult get their way at the end of all this and international travel is curtailed/discouraged.

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4 hours ago, Derek Flint said:

The difference with this pandemic to other blips in the landscape is that it has affected both our way of life, and the finances of many, many people. 

Folk will re-evaluate what they need to ‘live a life’. They will spend less, and save more for the rainy day. For a while, they will be bailed out by Government. But here, that money will run out. They will question why, because for the last two decades at least they’ve been told that this is a booming economy. They will now question why we suddenly need to ramp up taxes and charges to pay for a government that at parochial and national level is writing cheques it can’t cash. 

Mann needs to be leaner and fitter than ever before. And there will have to be public service casualties. The public are having a great awakening with this crisis, and will demand change.

Agreed. It was never really forced by the great unwashed before because a large % were sucking from the government teat and the private sector was ticking over, unemployment was low and even though stealth taxes rose your average family still had a decent standard of living compared to the majority of the planet.

With potentially thousands unemployed/struggling after this an increase in rates for example won't go down too well and politicians will get it in the neck on their weekly shop, walking the dog etc.., something which has been sadly lacking thus far.

Maybe some new MHK's might step forward with a conscience and aren't willing to be easily bought, cometh the hour and all that. 

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24 minutes ago, Derek Flint said:

Don’t forget the £38m at Liverpool. 

 

How good an investment is that looking like now? Suck up any penalty clauses and sack it off before another spade is sunk in the ground.

 

31 minutes ago, Max Power said:

I think that little project may be part of our resurgence as a tourism destination. To drop it now would be very short sighted in my opinion?

7 minutes ago, Lxxx said:

As much as I thought the whole thing was a short-sighted and ill thought out waste of money I do think we may see a resurgence of visitors to the island in the future, especially if Greta and her cult get their way at the end of all this and international travel is curtailed/discouraged.

I work in the tourism industry and I think Max may be right. I also think it goes both ways - island residents may be more willing/able to afford taking a boat across for a holiday than going to the usual places in southern Europe. (and I do think Brexit would have done this on it's own to a certain extent anyway, due to discussions I've had with guests) Liverpool is a superior gateway to most of the UK (via rail and road) than Heysham.

It's not just the people who are concerned about climate change who will be thinking of taking holidays closer to home, I think many will be wary of travelling too far away from home after Covid-19.

I also wonder how the airline industry is going to come out of this - are fares going to go through the roof to pay for what they're losing now?

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16 minutes ago, Zarley said:

 also wonder how the airline industry is going to come out of this - are fares going to go through the roof to pay for what they're losing now?

That’ll go one of two ways - either, just as you say, fares will explode as airlines try to gather pace on returning to lost levels of income, or fares will be ludicrously cheap (but not for long) to encourage us all back into the air.

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Just now, Uhtred said:

That’ll go one of two ways - either, just as you say, fares will explode as airlines try to gather pace on returning to lost levels of income, or fares will be ludicrously cheap (but not for long) to encourage us all back into the air.

One thing you can be sure of, there won't be half as much choice as previously. We're moving into an era of a smaller number of multinationals hoovering up market share across the board I would imagine, not just in aviation.  

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1 hour ago, Derek Flint said:

Don’t forget the £38m at Liverpool. 

 

How good an investment is that looking like now? Suck up any penalty clauses and sack it off before another spade is sunk in the ground.

Every state investment should be required to show a return, including the most expensive shed on Merseyside

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1 hour ago, Phillip Dearden said:

This post is becoming quite constructive, please keep going.

I think the answer to Derek's original question is a bit binary (oxymoron?).

The Island's wealth creation industries are mostly exports of financial services and these need zero tax. Even very low-tax would be a big problem for these sectors. There are a number of different sectors - fiduciary, life insurance, captive insurance, fund administration, fund management, gaming/gambling, banking and now an embryonic fintech sector. These grew at different times and their growth spurts enabled the IOM economy to grow. If anyone can think of the next sector, please go and see DfE, they should welcome you.

Until the bug struck, the IOM economy was doing OK. Our problem was that the Government's long-term cash-flows looked challenging. The government needs new economic activity which creates employees so that they can earn payroll taxes. From the Government's point of view, new activity needs to generate government revenue,  they can't do this via taxes on profits as these taxes would be a problem for our wealth creation industries. 

This is the binary bit - we either continue as we are and get better at it or we change completely. I do not know what we could change to so I suspect that after CV, we will need to become a more cost-effective and more efficient version of what we were ie lower-cost but with supply-side efficiencies. However, this model is mature and not welcomed in many other places so if anyone can think of a viable alternative, speak up.

Re wealth creation, we do have some manufacturing and I know some of them produce world-class products but the feedback I used to get about electricity prices and the inconvenience of crossing the water lead me to believe we will not be able to grow that sector sufficiently to be a major plank of the economy.  We also have tourism, fishing, and agriculture which have the potential to be wealth creators but the model they operate within would have to be very different (involving higher food prices) and I doubt these sectors could prop up the economy under any model.

Most of the other businesses on the Island eg accountants, lawyers, builders, retail, tradesmen, landlords etc provide vital serves and are necessary for a functioning economy but they would not be here if there were no wealth creators. You can't base an economy on selling foreign made goods to each other.

There is much mention above and in other threads of Government's around the world printing money and the IOM Government not being able to do that. We should not be too downhearted about this. Printing money does not create wealth, it shifts the power to consume resources to the Government. It is like a tax. In times of stress this is a useful safety valve but in the long-run it does not make an economy efficient. In the short-run this makes our Government's job tricky but in the long-run it may be a good thing. Some have suggested the IOM prints its own money. I doubt this is viable. If the IOM were to print its own currency (if legal) I suspect most businesses would choose to transact in £ or $ and the power to print own cash  can be very tempting leading to devaluation - think Zimbabwe. Again, using UK £ imposes some level of efficiency.

 

There must surely be options in the digital sector, building on the back of online gaming?

I believe there is quite successful digital hosting business going on & there must be options for green hosting if some of our wind & tide resources can be put to work - if only modestly to begin with

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1 hour ago, Lxxx said:

As much as I thought the whole thing was a short-sighted and ill thought out waste of money I do think we may see a resurgence of visitors to the island in the future, especially if Greta and her cult get their way at the end of all this and international travel is curtailed/discouraged.

There is potential as a 'sustainable island' holiday centre but even the DfE 440,000 visitor objective is overly ambitious

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20 minutes ago, Donald Trumps said:

Every state investment should be required to show a return, including the most expensive shed on Merseyside

That never works out though Donald, what would you suggest would be a reasonable return on our ports, and how do you collect and quantify it?

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1 hour ago, Max Power said:

That never works out though Donald, what would you suggest would be a reasonable return on our ports, and how do you collect and quantify it?

It'd have to be based on what the next administration set as it's objectives

The state must surely aim to become more entrepreneurial & end policies to the advantage of its own establishment above the ordinary members of the public?

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1 hour ago, Donald Trumps said:

It'd have to be based on what the next administration set as it's objectives

The state must surely aim to become more entrepreneurial & end policies to the advantage of its own establishment above the ordinary members of the public?

I can understand that but there are certain things which we need to make the economy work which will never turn a profit.

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