GUERNSEY’S Treasury minister has highlighted two areas of concern about the way the States looks after public finances. The first is the operation of a fund designed to maintain the ports and the second is the accepted practice of departments holding on to money they have not spent.
By the end of last year, the 13 eligible to do so had accumulated a total of just under £23.2m. - a little under £2m. each and representing more than £500 per island taxpayer.
On the face of it, that is playing fast and loose with cash that would be better returned to the people who provided it in the first place and is certainly what would happen in the private sector.
Allowing departments to hold on to this money was part of an earlier rationalisation of the States budgeting process and, as the then committees were being moved to a cost-capped system, it was designed to facilitate economy since there was no pressure to spend the budget or risk losing it the following year.
However, what the Treasury minister is indicating is that time has moved on and the departments should by now be putting together realistic budgets and, if they underspend, that should be a bonus for the taxpayer.
And with £4.4m. in the kitty, T&R is well placed to spearhead the return of funds.
The minister’s concerns about what is called the Ports Holding Account are also timely, for they highlight a double failure in States planning.
Since 1962 the ports have been run and financed to facilitate the entry and exit of goods and passengers yet not only did Public Services fail to highlight forthcoming expensive and essential runway work, it has not built up any reserves with which to pay for it.
Another anomaly of the fund is that while it supposedly recognises the strategic value of the ports, it is limited to a user pays approach and thus ignores the wider benefit to the island of these key assets.
His observations indicate that financial tightening still has some way to go and taxpayers will be pleased that he is driving the reforms.
Pleased the reforms are being driven
GUERNSEY’S Treasury minister has highlighted two areas of concern about the way the States looks after public finances. The first is the operation of a fund designed to maintain the ports and the second is the accepted practice of departments holding on to money they have not spent.
By the end of last year, the 13 eligible to do so had accumulated a total of just under £23.2m. - a little under £2m. each and representing more than £500 per island taxpayer.
On the face of it, that is playing fast and loose with cash that would be better returned to the people who provided it in the first place and is certainly what would happen in the private sector.
Allowing departments to hold on to this money was part of an earlier rationalisation of the States budgeting process and, as the then committees were being moved to a cost-capped system, it was designed to facilitate economy since there was no pressure to spend the budget or risk losing it the following year.
However, what the Treasury minister is indicating is that time has moved on and the departments should by now be putting together realistic budgets and, if they underspend, that should be a bonus for the taxpayer.
And with £4.4m. in the kitty, T&R is well placed to spearhead the return of funds.
The minister’s concerns about what is called the Ports Holding Account are also timely, for they highlight a double failure in States planning.
Since 1962 the ports have been run and financed to facilitate the entry and exit of goods and passengers yet not only did Public Services fail to highlight forthcoming expensive and essential runway work, it has not built up any reserves with which to pay for it.
Another anomaly of the fund is that while it supposedly recognises the strategic value of the ports, it is limited to a user pays approach and thus ignores the wider benefit to the island of these key assets.
His observations indicate that financial tightening still has some way to go and taxpayers will be pleased that he is driving the reforms.
Article posted on 19th August, 2008 - 2.30pm