THE one dominant political theme during 2009 has been ‘how can the States restrict expenditure’? I predict that will be at least partially replaced next year by ‘what is happening to our public services’? The two are not unrelated.

Of course, the political holy grail is to deliver the same public services more cost-effectively. With more than 100 suggestions from Tribal Consulting, the States certainly have options for achieving just that. However, even if all these efficiency saving are realised, the impact of public spending constraint in 2010 will come as a huge reality check for many islanders.

Traditionally, locals demanding new services have trotted out the cliche ‘we can afford it, we are a wealthy little island’. For a while, at least, we are going to have to realise that while there may be lots of wealth in Guernsey, our government is strapped for cash.

First let’s look back at 2009. There have been three big issues – not counting the sideshow of Guernsey independence.

A lot has been said recently on the imminent demise of zero-10 and that theme will run into 2010.

The other two recurring topics have been cutting costs and Guernsey’s system of government.

Both of these threads came together in October with the fundamental spending review. Members decided that only the Policy Council could be trusted to deliver tough proposals on saving money and they were promptly given cabinet-style powers to take over huge chunks of departmental mandates.

To some this means that there should be no more episodes like the one when the Environment Department failed to follow the States’ instructions over paid parking. However, in reality the States has just transferred responsibility for policy-making from 10 fallible political bodies to one centralised and equally fallible body.

The Policy Council is just as capable of ignoring States instructions over things they don’t like as any departmental board. Civil partnerships are a case in point. I suspect they will flunk some of the tougher issues thrown up by Tribal as well.

Supporters of centralisation claim we will still have consensus government – it’s just that most members won’t now make policy, they’ll just scrutinise it. That’s missing the point. Of course proposals will still need a majority vote in the assembly, but anybody who knows anything about politics understands that real power comes with policy formulation, not just voting ‘pour’ or ‘contre’ on the floor of the House.

That brings us to next year’s likely big policy thread, public services, cuts and the impact of the back door decision to create a quasi-cabinet. It was encouraging to see such unanimity in the States over the need to control spending, even if the choice of priorities was perverse. Restraint is needed to balance the books without big tax increases. Whether that will still be the case when corporation tax is reintroduced isn’t yet clear, but there’ll certainly be no return to the days of bread and honey.

So two cheers! The problem is the consequences. Don’t fool yourselves that efficiency savings will deliver spending constraint painlessly. Existing important services are going to be cut, or constrained, and new ones won’t be introduced. For example, medical inflation will make it almost impossible for HSSD to stay within its budget without shameful reductions in services, ward closures and so on.

I suspect similar situations may exist in other departments.

That’s when the focus of debate will shift. A few islanders might even start to think that paying slightly more tax would be worthwhile to keep vital services. Many more will get very hot under the collar over individual cuts and complain to the politicians ‘in charge’ of the relevant department – only to find these deputies are no longer really in charge – certainly in relation to all the fundamental spending review issues. Instead, all these big decisions will be taken by the Policy Council on their behalf.

It now also seems certain that a more formal move towards cabinet government will flow from the WAO report. At first the Policy Council didn’t want the damning report debated at all, but eventually, under pressure, they told their pals at PAC to finish the job they’d started.

The outcome isn’t difficult to predict. The PAC chairman has already said he wants a new commission to look at Guernsey’s system of government.

It will probably be packed with businessmen and conclude that power should be centralised. A cabinet looms.