CONFIRMATION from the Treasury minister that the States cannot control its expenditure is a worrying admission, for clearly no organisation can operate effectively, efficiently or for the long term without being in charge of its costs. In addition, the minister’s honesty might be seen to raise issues of government credibility.

The reason is that islanders were assured that the zero-10 package was in part based on keeping public sector expenditure increases at or below RPI and now that policy has been quietly dumped.

And, rather like Jersey police and the Haut de la Garenne abuse investigation, which version of ‘the truth’ are islanders supposed to believe.

Guernsey’s chief minister is well aware of the potential reputational and fiscal damage this policy stand-off can cause, in part because of his own insistence while at Treasury that restraint was a real part of zero-10. It is why he released a carefully-coded statement highlighting the dangers of unrestricted States expenditure.

The key part was his comment that, ‘whether our machinery of government is, as yet, strong enough to deliver high level corporate spending targets remains to be seen. If it can’t, then there will justifiably be increased calls for further machinery of government reform’.

That is a telling remark. Like local business leaders in today’s Guernsey Press complaining that the States is out of step with the private sector on cost control, the chief minister is acknowledging that government has to have a grip on what it spends, otherwise it cannot govern.

Equally, he is putting down a marker that if, perhaps, the Policy Council does not have the tools in the drawer to control payroll costs and departmental expenditure, it is going to have to acquire them. And probably pretty sharpish.

One of the reasons Public Services and the council is looking at commercialising the ports and Guernsey Water is to end the so-called Spanish practices enjoyed by the unions and civil servants that make effective management of those areas so difficult.

While it is the right route, it must not be a cop-out at the expense of tackling the rest of the public sector bureaucracy.