Chief Minister Writes On Fiscal Challenges Facing Manx Nation

[bluemonday]

http://www.iomtoday.co.im/news/Chief-minis...scal.5953732.jp

Published Date: 04 January 2010

By TONY BROWN MHK

Chief Minister

THE year 2010 will see the Isle of Man setting out in earnest on the road to readjustment following the revision of our VAT revenue sharing arrangements instigated by the United Kingdom Government in the autumn of 2009.

This sudden and unwelcome change has presented us with the greatest collective challenge of our recent history.

 

Dealing with it is a huge task, one that will take a number of years and involve several different strands of work, the structures for which are already in place.

 

The next Manx Budget in February this year will only be the first step in the journey, a journey which we can complete together and which will make this Island fitter for the future.

 

Countries around the world are facing major fiscal challenges and we are approaching ours from a position of relative strength. The Isle of Man still has a healthy and diverse economy, low unemployment, sound reserves and a great reputation as a centre for international business.

 

That international reputation, which is so important for the future of our economy, was enhanced by several items of good news in 2009.

 

The Isle of Man was placed on the OECD 'white list' of tax co-operation and transparency, the International Monetary Fund confirmed our continuing high level of compliance with global standards of financial sector regulation and supervision, and we received a positive report from the Foot Review of British dependencies.

 

Such endorsements, plus other positive moves during the year, reinforce the Island's standing as a place that is both enterprising and responsible. They help to pave the way as we renew the drive to develop and diversify the economy.

 

Another cause for confidence is the character of the Isle of Man and its people. This is a resilient and resourceful country, a cohesive community with a strong track record of working together to adapt to change. Our national motto sums it up: 'Whichever way you throw us, we will stand!'

 

Key to our economic resilience is the close relationship that exists between the government and the various economic sectors, which makes us quick to identify and support new niche areas.

Transition

 

However, the scale of the challenge ahead should not be under-estimated. Government's annual income is set to reduce by around 25 per cent over the next two years and although we have reserves to support a period of transition, adjusting to this change is a massive undertaking.

 

Looking forward, we face fundamental questions about the structure, role and size of government, its spending priorities and its sources of income. These will be hard questions with hard answers.

 

Such a radical review will need to be informed by discussion and debate across the Island, involving members of Tynwald, Government staff, the business community, the voluntary sector, the general public and other stakeholders.

 

The situation the Island finds itself in is indeed an opportunity to improve government's effectiveness, efficiency and overall value for taxpayers' money. At the same time government is aware of how its spending supports the wider local economy and many charities, so change has to be managed carefully.

 

In addressing this challenge government will be guided by our twin priorities of protecting the most vulnerable and needy in our society and promoting the Island's economy. The two go together as far as I am concerned, and we cannot afford to do the first properly unless we do the second properly.

 

We will continue, therefore, to provide a business-friendly environment, whilst upholding international standards of financial regulation and taxation, to support the economy and quality of life of our people.

 

The Island does have the resources – both financial and human – to manage this process of transition in an orderly and strategic manner.

 

It won't be easy and it will take time, but we can do it.

 

I wish everyone a good year ahead.

[Terse]

Full marks to the civil servant who was given the original piece of writing - an A4 sheet of white paper with "We is compleetley f*cked" written on it in red crayon - and converted it to that.

[manshimajin]

One interpretaion of this letter:

 

"This sudden and unwelcome change " - we were caught with our pants down

 

"Dealing with it is a huge task, one that will take a number of years and involve several different strands of work" - we don't know what to do so watch this space.

 

"The next Manx Budget in February this year will only be the first step in the journey, a journey which we can complete together " - we haven't been able to think of anything at the moment but February gives us another 4 weeks to scratch around - and btw you will still be paying my pension

 

"Countries around the world are facing major fiscal challenges and we are approaching ours from a position of relative strength." - don't panic Capain Mainwaring - we've only lost 25% of our income

 

"Such endorsements, plus other positive moves during the year" - such as the Health arrangements with the UK - and my nice trip to China

 

"Another cause for confidence is the character of the Isle of Man and its people" - people will grumble but we'll be able to do what we want anyway

 

"the scale of the challenge ahead should not be under-estimated" - that's why we've done nothing to date except approve the new fence at the Airport

 

"we face fundamental questions about the structure, role and size of government, its spending priorities and its sources of income" - I am announcing now that the LegCo will be closed immediately to improve government efficiency..

 

"Such a radical review will need to be informed by discussion and debate across the Island" - once we've made our minds up we'll contact you

 

"The situation the Island finds itself in is indeed an opportunity to improve government's effectiveness, efficiency and overall value for taxpayers' money" - we certainly would not have done this if we hadn't lost 25% of our revenue and btw we've blown most of your dosh on Rolls Royce projects (and my pension).

 

"In addressing this challenge government will be guided by our twin priorities of protecting the most vulnerable and needy in our society and promoting the Island's economy." - errm that means the 90 folk who have their tax capped and the 90 people who have their tax capped (ohh and you lot and paying for my pension)

 

"It won't be easy and it will take time, but we can do it." - it'll be tough on you but you will have to live with it

[P.K.]

How cynical.

 

All it needs now is for someone to point out how Tynpotwald ring-fenced their pensions with self-interest to complete the rout.

[Albert Tatlock]

It's healthy and necessary to trim the fat, essential to make the rest all lean, but the loss of 25% of income is going to inevitably dig into a lot of flesh.

 

Personally I can't see them doing all this without having to bring in some, albeit maybe a limited, form of Corporation Tax or other taxes. I think there may a couple of surprise announcements in the next budget statement - surely there has to be?

[P.K.]

TB:

 

"In addressing this challenge government will be guided by our twin priorities of protecting the most vulnerable and needy in our society and promoting the Island's economy"

 

The Bishop seems quite sure which of those twin priorities will take precedence:

 

Bishop Robert:

 

"... those with the least to start with will probably suffer most when cuts are made in public spending"

 

Well, at least the Bishop knows what a Hymn Sheet is...

[manshimajin]

It's healthy and necessary to trim the fat, essential to make the rest all lean, but the loss of 25% of income is going to inevitably dig into a lot of flesh.

 

Personally I can't see them doing all this without having to bring in some, albeit maybe a limited, form of Corporation Tax or other taxes. I think there may a couple of surprise announcements in the next budget statement - surely there has to be?

Of course you are correct Albert - what intrigues/concerns me is that the folks on the hill have for some time been making statements about not being able to afford "Rolls Royce" projects, all of us being in the same boat, need to take action, responsible spending etc etc and carrying on as if it will all go away. It has taken an incredibly long time for them to wake up to any hint of reality (and TB's epistle still reads as if things can be put off and taken gently over a few years thanks to the Reserves).

 

I just wonder about so called 'leaders' who have only really reacted at all since a 25% cut has been imposed on them by the UK ending its VAT subsidy. They clearly could not see an express train bearing down on them in the economic climate of the last 18 months+.

 

One can only hope that despite the guff about consultation, debate, discussion with everybody and their dog there will be some action rather than just talk.

[P.K.]

Personally I can't see them doing all this without having to bring in some, albeit maybe a limited, form of Corporation Tax or other taxes. I think there may a couple of surprise announcements in the next budget statement - surely there has to be?

Strange how they can raise employees NI contributions outside of a budget statement. How does that work I wonder?

[censorship]

Strange how they can raise employees NI contributions outside of a budget statement. How does that work I wonder?

 

when did that happen?

[bluemonday]

Tynwald votes for rise in NI to boost health service

Published Date:

19 November 2009

http://www.iomtoday.co.im/news/Tynwald-vot...e-in.5840995.jp

[Utah 01]

Thank the Lord! 'Stakeholders' will be involved! This mythical invention of the management-speak gurus is clearly alive and well here on the Island. The Dear Leader's epistle had been so reassuring until 'Stakeholders' appeared clearly revealing that across the piece and going forward, the blue-sky thinking of our civil servants is impregnated with the very best practise in management speak enabling them to take things to the next level and thereby empowering this deserved group to hit the ground running, contribute positively to our communities and our environement and embrace diversity as an essential component of the way we do business. Stakeholders - where would we be without them?

[censorship]

Tynwald votes for rise in NI to boost health service

Published Date:

19 November 2009

http://www.iomtoday.co.im/news/Tynwald-vot...e-in.5840995.jp

 

Thanks for the link - wasn't sure when it was, and now I know

[thebees]

There was a joke on the tv the other day, about an Aussie government building being called the 'wedding cake' however the locals called it the fruit cake, due to its occupants. I thought it quite apt. Ours is more like a fruit and nut cake though.

[thesultanofsheight]

Thank the Lord! 'Stakeholders' will be involved!

 

I hate the word stakeholders and anyone who uses it. Its a real w@nker phrase - bsically he's saying that were all going to be shagged up the arse not just those muppets who created this situation in the first place.

[triskelion]

I just wonder about so called 'leaders' who have only really reacted at all since a 25% cut has been imposed on them by the UK ending its VAT subsidy. They clearly could not see an express train bearing down on them in the economic climate of the last 18 months+.

Neither did you though.