Briefing note 5

The briefing note below is the latest in our series summarising prospective business at States Meetings, to enable 2020 Association Members to be informed. It is largely self explanatory; as usual, Members’ comments are welcome.

 

Future States Business brief (5) – Meeting of 22 May 2019

As usual, there is routine business as well as some more interesting topics. The routine business comprises, first, certain elections, namely (i) the President of the States Development and Planning Authority (to replace Deputy Gollop following his recent resignation), (ii) certain Governors of the Ladies College and (iii) the re-election of the Chairman and Deputy Chairman of the Panel for the Administrative Decisions (Review) Board, Deputy Green and Mr Richard Heaume) for a further term.

 

(A list of complaints received by this Panel since 2015 and their outcomes is appended to the Billet for the 22 May meeting. Very few appear to go anywhere, mostly dividing between those which were declined on the grounds that the complainant had a legal remedy which ought to be pursued, and those which were not pursued after unspecified “discussions” with the relevant authority or committee.)

 

Second, there is a total of 23 Ordinances, Regulations and Orders laid before the Assembly effectively for confirmation. Most of these are contingency preparations for Brexit. They therefore range through a hugely diverse set of matters. at one extreme regarding the implementation of international trade agreements, the regulation of customs and tariffs, of company acquisitions of animal health and of medicines, and at the other extreme, down to the registration of trailers, the importation of bees, exemptions to seat belt requirements, and paving the way for a code of regulation for the crewing of small merchant vessels.

 

There is one proposed piece of primary legislation for which States approval is sought, being a very short measure to allow an individual to receive a carer’s allowance under the Severe Disability and Carer’s Allowance (Guernsey) Law 1984 at the same time as receiving any benefit under the Social Insurance (Guernsey) Law, 1978.

 

The more interesting topics appear under the “Other Business” before the States.

 

The first is probably not controversial in all the circumstances. It is approval being requested to proposed amendments to the Public Servants’ Pension Scheme Rules 2016. The background is that general and universal changes to the terms of public service pensions were proposed in 2015, to make the expense of these pensions more sustainable, as people lived longer. The proposals were accepted by a majority of the Association of States Employees Organisations, and the Policy Council approved this as being therefore representative of approval generally, and the new scheme and its Rules were therefore implemented in 2016. However, certain sections of public servants, represented by the Unite union, did not accept the new scheme and instituted a legal challenge. This dispute went to mediation and was settled, to avoid the expense (and bad feeling) of a trial. The agreement reached at mediation was approved by a majority of those represented by Unite, and therefore became binding. The effect of the agreement, however, is to introduce further options with regard to the new scheme, different from those contained in the 2016 Rules. The effect of the amendments being proposed is therefore to make these further alternatives available generally to all States employees, for fairness.

 

The only further points which need noting are, first, that there is a separate section explaining the application of the new form of the scheme to judicial officers (ie the full time judges and the senior Crown Officers), who are not States Employees, but who participate in the pension scheme. It is explained that the provisions in relation to those office holders are designed to bring the scheme into line with changes to the judicial pension schemes implemented in the UK. The second further point is that the opportunity is also being taken to provide for certain unintended consequences and omissions in the 2016 Rules, such as unintentional discrimination against same sex marriage partners.

 

The precise terms of these pension provisions are are very complex, as one would expect, and a full and accurate review is beyond the scope of this briefing note. An introduction, for those interested further, can be found in the explanatory letter to this item of States Business on the gov.gg website.

 

The next piece of “other business” is a Requete by seven States Members with regard to the policy for disposal of inert waste. This asks the States to alter the present policy to dispose of inert waste (once the present landfill site at Longue Hougue is full) by further land reclamation at that site, and instead to direct the States Trading and Supervisory Board to prefer, and to investigate and pursue, the option to use such inert waste for the purpose of redeveloping St Peter Port Harbour. An illustrative phased proposal suggests the creation, over four years, of a block extension out from the current Eastern Breakwater beyond the QEII Marina, followed by the creation, over a further period of 10-15 years, of a further pier or piers from this, southwards, parallel to the White Rock pier, and the enlargement northwards of the original area of extension. The economic case and possibilities for such a proposal are argued, and its consistency with previous States’ approach to considering an alternative to further land reclamation at Longue Hougue as well as the objective of harbour redevelopment is pressed, whilst stressing that the proposals put forward are illustrative only, the principle behind them being to make economic use of inert waste towards the accepted desirable objective of harbour redevelopment.

 

Once again, it is beyond the scope of this briefing note to set out more detail of the Requete proposals and it is understood that proposed amendments may well be laid, although this Association has no knowledge of what these might be. Whilst there is obvious sense behind such a proposal – far better to make good economic use of inert waste for something rather than simply looking for where it can be dumped – the concern must surely be that this is too narrow a proposal to be pursued alone. The sensitive and economically effective redevelopment of St Peter Port harbour requires a broad visionary scheme on a much wider general basis. Recently Richard Digard referred, in an article in the Guernsey Press, to one such wide scheme proposal, including the generation of tidal power, the accommodation of cruise ships, and associated economic and “green” benefits, which has not been widely publicised despite having potential financial backing, and which has seemingly been either dismissed, or suppressed, by the States. Surely, though, it cannot be sensible to pursue one particular aspect of harbour redevelopment without ensuring that it will at least fit with, and not interfere with or limit, any wider and more all-inclusive harbour redevelopment strategy which it may be desirable to pursue?

 

That really concludes the States Business agenda. The only further point to note is the appending to this agenda of the Annual Report for 2018 of the States Scrutiny Management Committee. This Committee operates as both a panel scrutinising key areas of government policies and spending, and also considering law reform. Its report makes interesting reading, and the overall impression is that the committee has been doing a good and energetic job at holding States departments to account, sometimes in the face of indignant objection.

 

A tone of some frustration can be detected in the report. The Committee points out that its scrutiny function is, inevitably, retrospective, and that it is for the Deputies and others who sit on Committees and Authorities to carry out oversight functions on a current basis as business is conducted. Perhaps, though, the most interesting sign of frustration is revealed by the following quotation.

 

    “The Scrutiny Management Committee believes through its experience gained to date that the new system of government is failing to allow sufficient scrutiny of financial matters. It is our collective opinion that the States of Guernsey must provide greater financial transparency and we continue to monitor developments closely. We believe additional access to information and the ability to influence policy, as enjoyed by other jurisdictions, would significantly improve the current position.”

 

A review of the activities of the Committee suggests that it takes its mandate seriously and its efforts are to be applauded.

 

(Further information regarding future States Business can be found on www.gov.gg under “Search States Meetings Information.”)

 

Airport Runway (Part B) Tender information

2020 Association demands to see PwC Part B Tender docs.

The 2020 Association has made a request under the States of Guernsey Code of Practice for Access to Public Information (2014) for information for tender documents and information relating to Part B (business case) of the PwC island’s air and sea transport links report, with a view to general disclosure to the public.


James Collings, the Chairman of the Association, said “Following our successful request to have the PwC Report into Air Links Infrastructure Report released, The 2020 Association now requests further information relating to the tendering and costing of Part B of this Report, which the States voted not to pay for on the 26/04/2019. These are documents that can be released to the public in a redacted form at least. They have been paid for from the public purse. The taxpayer has a right to see them, and P&R have an obvious obligation to produce them. The 2020 Association has therefore made a request for production under the States of Guernsey Code of Practice.”

The improvement of transport connectivity, and the implementation of a full Freedom of Information Law are among the foremost stated objectives of the 2020 Association.

A copy of our letter is here.

Fund PwC Airlinks Part B – vote Option 1(b)!

At its States Meeting to be held this week, the States are to consider a proposal to fund Part B of the PwC Strategic options review – Part A of their work.

Part B entails producing a cost benefit analysis relating to a runway extension as recommended by PwC. It is Option 1(b) of the Proposition to be voted upon.

In our survey, which concluded yesterday, 2020 members voted overwhelmingly to perform Part B, as follows:

Over 90% of respondents wanted Part B to be funded in one form or another. More than half respondents wanted the States to perform Part B in relation to a 1700 – 1799m extension, a little under half, Part B for all options. Only a very few wanted the other options, including doing nothing.

Option 1(b) of P&R’s Review of Strategic Air and Sea Link Infrastructure(P.2019/21) provides for completing Part B, the consideration of the technical, regulatory, environmental and economic aspects of extending the airport runway.

To recapitulate, we asked our members to choose between the following options:

Do nothing – don’t fund Part B. (The Chamber of Commerce and Institute of Directors made a joint submission which P&R received on or shortly after the 14/09/2018. In the section relating to economic impact due to the weakness in the island’s connectivity:

the impact would approach £100m per annum in lost GDP to the island”).

Perform analysis in relation to a 1,570m extension only. (PwC Report, Pg 20: “The 1,570m extension appears to be the best runway option if it is feasible from a commercial and operational perspective for more than one airline.” (However there is a caveat on  page 14 relating to payload restrictions)).

Perform analysis in relation to a 1,700 to 1799m extension only. (PwC Report, Pg. 20: “A 1,700 -1,800m extension should be taken forward as the primary alternative to the 1,570m option. There are clear additional benefits and it is lower risk in the longer term, although there may be a substantial cost difference”).

Perform analysis for all options.

They could also add their own preferences.

P&R’s 12/12/18 statement was strongly against performing Part B, but it did not appear based in fact.

 

Lower fares NOT an option to longer runway

A front page article in the Guernsey Press headed ‘Lower fares option to longer runway’ states that ‘A STATES-FUNDED reduction in air fares could be introduced rather than a runway extension, but it could cost around £8m. a year.

The suggestion is that there could be direct subsidy for airlines instead of a runway extension. It quotes a £10 reduction per ticket costing £8m a year. This pronouncement is quite extraordinary!

It would be more expensive than an extension in less than a decade. It would be less impactful (a £10 saving is scarcely going to make a game changing difference and turn Guernsey into a vibrant economy to which tourists and business would flock. And it would be less sustainable – surely Guernsey wouldn’t commit to spending £8m a year in perpetuity. Perhaps most importantly, it would probably be illegal – certainly if applied only to Aurigny.

This surely also raises other issues:

Aurigny Group is perpetually ‘recapitalized’ and not ‘subsidised’, but:

  1. do Aurigny ever pay these loans back?
  2. if the loans are written off, does this not constitute a subsidy through the back door? (in practical terms it would appear to)?
  3. if this is so, does it not fall foul of UK competition laws?

Public sector operator subsidies are allowed on PSO/lifeline routes which could never make a profit, but this cannot really be claimed for Guernsey. Route support is allowed to start up new routes for a while until routes are profitable or abandoned, usually scaled over three years, but that is not this case. Subsidies can also be given as ‘route support’ i.e. reduced landing fees, but these have to be available to every airline.

It may be because of the above that Alastair Ford, Head of Shareholder Executive of States’ Trading Assets, was quoted by the Press as saying “That could conceivably include States funding to reduce fares on any service, not just those offered by Aurigny”.

Examining more of the proposals as quoted in the Guernsey press creates little confidence in the depth or soundness of any reasoning behind them.

There is a comparison between “infrastructure options” and “market based options” when “addressing concerns about airlinks” and this is a preference for the latter. This, though, suggests a belief that you can improve things just by improving routes, or increasing publicity, to attract traffic – and that this is actually viable. But you won’t get routes unless you can land the planes and this approach has surely already been tried with the existing runway length, and has not worked – eg, London City and other regional UK airports, and the reduction of passenger numbers in the face of all the marketing efforts of VisitGuernsey.

Just offering holiday routes to Norwich (or wherever else Aurigny’s marketing people think they can offer for a weekly service in the summer as a gimmick) is not going either to make Aurigny profitable or increase the tourist and business traffic to Guernsey.

This suggestion of knocking £10 off air fares, rather than build a runway extension and move Guernsey at least some way towards the 21st century, is either populist or pathetically naive thinking, and just calculated to bring about another kick of the can down the road, as usual.

This suggestion has been given front page coverage by the Guernsey Press. It is sad that the 2020 Association’s “Fact Check”, in which it compared the PwC Report on extending the runway, with the P&R statement made to the States in regard to this report before it was made public, has not been thought to be worth similar reporting.

© 2019 The 2020 Association

Briefing note 4

The briefing note below is the latest in our series summarising prospective business at States Meetings, to enable 2020 Association Members to be informed. It is largely self explanatory; as usual, Members’ comments are welcome.

Future States Business brief (4) – Meeting of 24 April 2019.

Let us go straight to the big issue for the States Debate at this meeting, which is item 4 on the Agenda, the Review of Air and Sea Links Infrastructure.

With regard to air links, P&R are going to ask the States to support the extension of the airport runway from 1463m to 1570m, which can be carried out within existing boundaries, and to rule out further investigation of the case for extending the runway to 1700/1800m, which would require some extension of the airport boundary towards the East, although only into land already reserved, in planning terms, for such purpose. This latter is acknowledged to be a more “future proofed” long term solution, but would, obviously, take longer to implement, cause more physical disruption, and be more expensive (although the logic behind the stated objection that there would be increased costs in “servicing an airport scaled towards greater payload capacity” seems odd, bearing in mind that increasing capacity seems to be the very advantage being sought). Whilst the arguments presented in P&R’s policy letter are all, accordingly, tailored in favour of the former as their preferred option, they do propose that if the States are not satisfied with this minimum extension project (which was so shortsightedly not carried out in the course of the last round of airport improvements in 2011/12 – another example of Guernsey moving little and late), then they invite the States to approve a capital vote of up to £700,000  for studying the economic business case for the longer extension (This surprisingly high figure appears to arise from its unnecessarily covering the costs of all possible studies.)

2020 takes credit for having brought the PwC Report itself into the public domain four weeks ago, so as to do so sufficiently in advance of this debate for the public, and Deputies, to have time to compare the actual terms of that Report with the presentation made to the States in December.  It was then that P&R’s intention to rule out further investigation of the business case for a longer runway was announced, but whilst still keeping secret the PwC Report and preventing the soundness of their reasons from being assessed by outsiders: see 2020 Association demands to see PwC reports on transport links and Air links P&R Statement – Fact check.

There is no room in a briefing note to rehearse the various arguments with regard to this issue,  good, bad or dubious, but 2020 will conduct a survey of members to ascertain their views. P&R’s arguments can be found in the Policy Letter contained in the Billet for this Meeting on the States Website at https://www.gov.gg/CHttpHandler.ashx?id=118448&p=0

As a point of passing interest, Jersey has a runway of 1690m.

With regard to sea links, P&R’s recommendation is simply to allow for another £400,000 to be spent on investigating two of the four “contingency options” identified as possible future courses of action, having regard to stated concerns about the present services, and the possible sale of Condor Ltd, and the fact that Condor’s service agreement terminates in 2024, but with a prior three year period for discussing its continuation or wind down and exit. The preferred options are those of (a) investigating the willingness of other ferry operators to take over the service, and (b) the States of Guernsey itself acquiring its own fleet and providing the service.  The options of the States of Guernsey seeking to acquire Condor Limited, either alone or jointly with the States of Jersey, are not recommended.

The only other matter of States Business of immediate general interest is the Report and proposals regarding the implementation of Island Wide Voting for the 2020 election. These go, in general, to the practical considerations of managing this system. The Report reviews, in chronological terms, the various aspects and implications of an island wide election, such as compiling the electoral roll, the eligibility of candidates, expenditure (both that likely to be incurred by the states and also that to be permitted to candidates), permissible donations, and the practical arrangements for polling day itself and the subsequent installation of Deputies. Nothing of particular moment arises, but this item is a timely reminder to Members that the objectives of the 2020 Association are to gather a sufficient group of candidates for Deputyship, of common sense, ability and like-minded views on core policy issues, so as to enable Association members’ views to carry weight in the next States Assembly.  Members are all asked to help in this direction, both by recruiting more members to our cause, and by identifying suitable candidates.

To be noted in passing is a proposal to modernise the Statutes of Elizabeth College, both to increase the number of Directors on its Board and to detach the governance of the College from close connections with the church through the Dean of Guernsey, and also from the involvement of the States itself, by removing the requirement for Deputies to be Directors of the College. This is in the light of the phasing out of Special Place Holders at the College, and the current trend towards the strict separation of private and public educational opportunities – which some will no doubt find very sad.

The remainder of States Business for this Meeting is either esoteric or mundane.    In the former category there is the final text of a lengthy Ordinance, previously authorised by the States, to apply the Nairobi International Convention for the Removal of Wrecks to Guernsey. [Shipwrecks of course – Ed].    In the latter category come the legislative instruments laid before the Assembly simply for approval.  These cover regulations on such topics as fees for foreign aircraft and for liquor licensing, and the destruction of electoral ballot papers, and they require no further comment.

We are having our first public meeting at Les Cotils on the 2nd May 2019 at 7pm where we will discuss much of the above. It’s free. Please click on the link to confirm your attendance. Bring friends and family.

Membership of The 2020 Association is free – we’re not trying to get your money but your support! Please join.

Information regarding future States Business can be found on www.gov.gg under “Search States Meetings Information.”

Air links P&R Statement – Fact check

The 2020 Association considers air links to be a top priority for Guernsey’s economic development.

We were disappointed by the 12 December 2018 statement by the Vice-President of the Policy & Resources Committee renouncing further investigation into a runway extension.

As part of our assessment of the rationale behind P&R’s announcement, we demanded publication of the PwC Air Links report.

Following our success we have been able to review the PwC report and feel obliged to point out that the P&R statement is at odds with many of the detailed findings in the PwC report and its overall conclusion.

Whilst these are numerous, we have outlined three critical contradictions at the start of this article (labelled Claims A, B and C) which are with regard to fundamental matters in informing our ongoing support of producing a cost benefit analysis relating to a runway extension (i.e.  Part B of the exercise as recommended by PwC).

We then continue with a more detailed examination of the comparison of the contents of the PwC Report, other sources and the statements made to the States as recorded in Hansard and the account of these statements as they now appear on the government website (labelled Claims 1 – 7).

We welcome views from the public and media on the runway extension. Please contact us via Facebook, email or a direct comment at the bottom of this article.

We are having our first public meeting at Les Cotils on the 2nd May 2019 at 7pm in relation to this. Please click on the link to confirm your attendance.

The three critical contradictions:

Claim A
Policy and Resources Statement

“The Policy & Resources Committee has reached the conclusion that the option of extending the airport runway will not be a game changer in respect of our connectivity”.

PwC Report

“The 1,570m extension appears to be the best runway option if it is feasible from a commercial and operational perspective for more than one airline”.

“A 1,700 -1,800m extension should be taken forward as the primary alternative to the 1,570m option. There are clear additional benefits and it is lower risk in the longer term, although there may be a substantial cost difference”.

2020 Conclusion – FALSE

The P&R statement contradicts the commissioned PwC report.

Claim B

Policy and Resources Statement

“The truth of the matter is that if [sic] were to extend the runway to the length that PwC indicate it would be a game changer, we would need a huge and complex planning inquiry, probably to bulldoze part of St. Peter’s…”

PwC Report

“Because of the geographical characteristics of the airport, an extension of the runway that goes beyond the existing boundary is likely to require filling in a ‘valley’ to the east, which would have an associated cost”.

2020 Conclusion – FALSE

The P&R statement contradicts the commissioned PwC report.

We also note the P&R statement contradicts Island Development Plan Policy IP4 “Airport Related Development Proposals relating to the operation or safety of the airport will be supported”.

Claim C

Policy and Resources Statement

“…enormous investment on which there may never be a return”.

PwC Report

“ASM have estimated that the extension plans would bring additional value to the Guernsey economy.”

On the 1700m extension: “We recommend that this is taken forward as the other runway reference case and subjected to detailed cost-benefit analysis to determine if the greater cost of this option justifies the tangible benefits”.

2020 Conclusion – FALSE

The P&R statement contradicts a previously commissioned report from ASM and concludes on a cost benefit analysis that has not yet been completed and that the recently commissioned PwC report actually recommends. They call it ‘Part B’.

A more detailed examination:

The following is a more detailed examination of the P&R Statement.

Our work became more complicated than it at first appeared: the statement as issued on the gov.gg website is manifestly different to the official Hansard in critical areas. Gov.gg statement quotations in green, Hansard quotations in orange, black where they both agree.

Claim 1

Gov.gg Para 25: The Policy & Resources Committee has reached the conclusion that the option of extending the airport runway will not be a game changer in respect of our connectivity”

Hansard Line 871: “..the Policy & Resources Committee has reached the conclusion – and we are unanimous in everything I am telling you this morning – that the option of extending the airport runway will not be a game-changer in respect of our connectivity.”

Gov.gg Para 43: “Sir, the Policy & Resources committee does not believe a case has been made to extend the runway, so we do not propose undertaking further work.”

Hansard Line 917: “Sir, the Policy & Resources Committee does not believe a value for money case has been made to extend the runway, so we do not propose undertaking further work.”

PwC Report, Pg. 20: “A 1,700 -1,800m extension should be taken forward as the primary alternative to the 1,570m option. There are clear additional benefits and it is lower risk in the longer term, although there may be a substantial cost difference”

PwC Report, Pg 20: “The 1,570m extension appears to be the best runway option if it is feasible from a commercial and operational perspective for more than one airline.” (However there is a caveat on  page 14 relating to payload restrictions.)

2003 BAE SYSTEMS Infrastructure Solutions: Guernsey Airport Runway extension, JAC Report1/Issue3/27.01.03: Pg 15

“5.6 Conclusion

For the purpose of runway length, therefore, the new generation of regional jets have been selected as the design aircraft, as these are likely to form the majority of scheduled jet aircraft movements towards the end of the 25 year planning period.

This results in a required runway length not less than 1700m as being a minimum requirement to allow satisfactory payload range performance for these types of aircraft.”

2003 November 26 Billet, Para 6.4 (Pg 2391) ends: “..A runway length of 1,700 metres is the minimum to enable, “satisfactory payload range performance for these types of aircraft.” (page 15, BAE SYSTEMS Infrastructure Solutions’ Guernsey Airport – Runway Extension Report 1 – Runway and Taxiways, January 2003).”

2020 Conclusion – NO BASIS IN FACT

1700m was a solution 15 years ago to future proof us for the next 25 years.

Claim 2

Gov.gg Para 26: “The truth of the matter is that if [sic] were to extend the runway to the length that PwC indicate it would be a game changer, we would need a huge and complex planning inquiry, probably to bulldoze part of St. Peter’s, and enormous investment on which there may never be a return.”

Hansard Line 875: “What we do know is that if we were to extend the runway to the length that PwC indicate it would be a game-changer. We would need a huge and complex planning inquiry, probably to raze to the ground part of St Peter’s and enormous investment on which there may never be a return. The truth, Members of the States, that so far at least, there is no compelling or even marginal business case for an extension of that magnitude.”

We break this down:
Claim 2.1
Gov.gg and Hansard: “..we would need a huge and complex planning inquiry..”

Island Development Plan section 20.5, pg 21 states:

“Policy IP4: Airport Related Development
Proposals relating to the operation or safety of the airport will be supported where it would ensure the continued effective, efficient and safe operation of the airport.”

2020 Conclusion – FALSE

The 2016 IDP effectively reserves the land for airport use.

 Claim 2.2

Gov.gg: “..probably to bulldoze part of St. Peter’s..”

Hansard: “..probably to raze to the ground part of St Peter’s..”

2020 Conclusion – FALSE

St Peter’s in Guernsey lies to the west of the runway. Recommended 1700 – 1799m development examined in PwC report on page 20 lies to the east; there is nothing in the report that suggests that any work needs done beyond the existing western boundary.

A Code 3 (1200- 1799m) paved runway will remain within the current airport boundaries. However a RESA would have to be accommodated to the east of the existing boundary, presumably over the La Villaize Rd. or by infilling it.

 Claim 2.3

Gov.gg and Hansard: “..and enormous investment on which there may never be a return”

1700m extension costed at £23M in 2003, (at least) £23M in 2009,

option C2 in Billet XXIV 2009 volume2 p.1857 gives indicative cost.

The Chamber of Commerce and Institute of Directors made a joint submission which P&R received on or shortly after the 14/09/2018. In the section relating to economic impact due to the weakness in the island’s connectivity:

“the impact would approach £100m per annum in lost GDP to the island”

2020 Conclusion – SPIN

Recuperation period for Guernsey economy seems short.

Has the cost of not doing anything been calculated?

Air visitors are at their lowest since 1998. Economy suffering.

Claim 2.4

Gov.gg Para 25: “The Policy & Resources Committee has reached the conclusion that the option of extending the airport runway will not be a game changer in respect of our connectivity”

2020 Conclusion – SPIN

This seems in contradiction with Hansard Line 875:  What we do know is that if we were to extend the runway to the length that PwC indicate it would be a game-changer.

 Claim 2.5

Missing from Gov.gg version

Hansard Line 878: “The truth, Members of the States, that so far at least, there is no compelling or even marginal business case for an extension of that magnitude.”

2020 Conclusion – MISLEADING

PwC proposed a professional, fact-based cost/benefit evaluation (business case) of a runway extension as Part B of the process, but this has not yet been undertaken. P&R have established their position before the facts, and it appears that they do not want them to be evaluated.

Note: The 2018 PwC Report, 2003 BAE SYSTEMS Infrastructure Solutions JAC Report and the generally accepted development would be a 1700 – 1799m runway. The pavement could be contained within the current airport boundary. A RESA (runway end safety area) would need to be created to the east of the current airport boundary. 

The PwC Report does not recommend the 2000m option.

In order for the Aurigny jet to autoland in fog a minimum runway length of 1650 m is required as the landing distance is increased when a E195 is autolanding even if the radio aids and runway lighting was improved to CAT 3. The current Guernsey runway length is limiting even for the E195.

Claim 3

Gov.gg Para 27: “The Policy & Resources Committee does not believe that the community nor the political body has the appetite for that. Therefore spending hundreds of thousands of pounds of tax payers’ money on listing the pros and cons of a set of runway extensions that are unlikely to be built in our lifetime will not be a worthwhile exercise”

Hansard Line 880: same with qualifier “.. a set of runway extensions that in our view are unlikely to be built in our lifetime will not be a worthwhile exercise”

Gov.gg Para 31: “So if the States does not agree with P&R’s recommendation, if States Members believe that their parishioners want us to spend upwards of half a million pounds investigating the runways further, then they will have the opportunity to direct the Policy & Resources Committee otherwise.”

(Hansard Line 890 substituted ‘parishioners’ with ‘constituents’)

The PwC Report, Pg 20, states ..“A 1700 – 1800m runway extension should be taken forward as the primary alternative to the 1570m option. There are clear additional benefits and it is lower risk in the longer term” they go on to say that this “..would be likely to provide benefits in terms of opening up Guernsey to a wider range of fleet and airline options, including British Airways and European charter operations” and they continue “We recommend that this is taken forward as the other runway reference case and subjected to detailed cost – benefit analysis to determine if the greater cost of this option justifies the tangible benefits.”

2020 Conclusion – MISSING BASIS IN FACT

That analysis would form Part B of the Report (the business case) which must be completed for at least a 1700 – 1799m extension before an opinion such as P&R’s above can be reached. A proper decision making process is obligatory for all major investments; policy must not be formed on a whim. It must be made in an objective, evidence based manner.

Where does P&R’s ‘belief’ come from?

Claim 4

Gov.gg Para 39 – 43: “Let me be clear then, on the Policy & Resources Committee’s position as it concludes its review:

What islanders consistently tell us is that they want frequency; what a longer runway offers is potentially less frequency as larger aeroplanes rotate routes less frequently.

What Economic Development wants is choice; a longer runway does not guarantee choice – airlines could start flying in on the current runway if they see a business case.

What our island wants is an island airline with the right fleet and a commitment to the island – not a procession of so-called brand airlines cherry picking routes every summer.

Sir, the Policy & Resources committee does not believe a case has been made to extend the runway, so we do not propose undertaking further work.”

Hansard Line 913 substitutes “..What Economic
Development, completely understandably, wants is choice. ..”

and Line 917: “Policy & Resources Committee does not believe a value for money case has been made to extend the runway..”

PwC Report, Pg 34: “The importance of each indicator varies by passenger group. Reliability is a key issue for all passengers”

In the split between ‘Business’, Leisure’ and ‘Visiting Friends and Relatives’, affordability is in all groups, and top of two.

Frequency is not mentioned on this page.

The CofC/IOD’s press release states that competitive fares are most important (80% of respondents) and frequency is 5th (28%). We quote:

“The IoD and Chamber are concerned that the States are failing to address the concerns of the business community in respect of the evaluation of the islands air and sea links.

The statement made by Deputy Lyndon Trott on behalf of P&R issued to the States on 12th December suggests conclusions have already been drawn in the evaluation of the current status and assessment for the development of the air links and sea links infrastructure. Whilst we agree with the opening statements regarding the criticality of the impact of our transport links, we disagree with the recommendation to terminate the evaluation of air links without having completed the evaluation process.

With regards to the Policy and Resources Statement the IoD and Chamber would like to clarify the following specific points: 

(1)   The business groups undertook the survey and submission at the ‘specific request’ of the Economic Development/ Policy and Resources committees in support of the work undertaken by PWC. 

(2)   The joint member survey clearly identified “Competitive Fares” as the top priority for Guernsey’s connections with London, highlighted by 80% of respondents. The need for “6 flights per day to Gatwick though out the year” was 5th, highlighted by 28% respondents.  Given P&R’s statement it would be helpful to understand evidential basis on which they identified frequency as the leading consideration in the development of air links. 

(3)   It is apparent that Policy and Resources have focused on an extension to 2000m, which is inconsistent with our prior understanding that the PWC review was recommending investigations of two much more modest options, 1550m and 1750m. It would be helpful to understand why such an extreme position which would clearly cause a lot of distress in the local Parish has been proposed as the solution against which to judge viability. 

The survey clearly expressed the concern of the business community with the current situation, the lack of progress and the lack of a cohesive plan to evolve our air and sea links leading to a lack of confidence to make investment in the business environment.”

2020 Conclusion – NO BASIS IN FACT

The CofC/IOD drew their conclusions from material in circulation prior to this P&R statement and indeed that statement referred to those surveys. (Para 21)

Claim 5

Gov.gg Para 41: “What Economic Development wants is choice; a longer runway does not guarantee choice – airlines could start flying in on the current runway if they see a business case.”

Hansard line 910: What Economic Development, completely understandably, wants is choice. A longer runway does not guarantee choice – airlines could start flying in on the current runway if they see a business case.

2020 Conclusion – UNCLEAR OR MISLEADING

What was inferred by ‘choice’? Implication is choice of airlines.

If so, this is not true in sense they can only fly in restricted aircraft and or reduced payloads. No low cost Easyjet / Ryanair. So selective airlines only. Aurigny.

Claim 6
Both Paras 11 – 13: “Back in 2016, the-then new Committee for Economic Development told us it would be bold and brave. But there was little progress on air and sea links… (and ending) …That was why the President of the Policy and Resources Committee and I submitted an amendment to take forward a review of air and sea links infrastructure which was wholeheartedly supported and agreed by the Assembly.”

The sequence of events was as follows:

The States’ meeting of 27th June 2017 on the P&R Plan had the following submission from the CfED:

On p.147 second bullet point it stated “Examine the viability of extending the runway in order to facilitate additional connections with the UK and Europe by Q4 2017 and report the findings to the States.”

Deputies Roffey and Soulsby drafted an amendment to remove this work stream.

Following the brouhaha that followed P&R suggested the following amendment which was passed by the assembly. The Roffey/Soulsby amendment was withdrawn.

Amendment 29 was – “To insert at the end of the words in Proposition 6 b): “, but subject to deleting the “Guernsey Runway Extension (Pipeline) from table 27 and replacing it with “Strategic Air and Sea Links Infrastructure (Pipeline)”.”

The time frame for delivery therefore became the responsibility of P&R.

P&R were aware of this and the sequence of events is recorded in Hansard for the appropriate meeting & particularly so as P&R laid the amendment to do the work:

 
and the final amendment was:
 
 
2020 Conclusion – FALSE
 
The Committee for Economic Development work stream was stopped and taken over by P&R.
Claim 7

Gov.gg Para 30: “We should also remember that [sic]he States’ Trading Supervisory Board is looking at extending the RESA, as directed by the States, and is reporting back in the first quarter of 2019, and the requerants have said that this might be the solution needed.” 

Hansard Line 885: “We should also remember that the States’ Trading Supervisory Board is looking at extending the runway end safety areas (RESAs), as directed by the States, and is reporting back in the first quarter of 2019, and the requérants have said that this might be the solution needed.”

Both: Para 72 /  Line 970:  Repeated in summary: “Work on the extension of the RESA”

Deputy Kuttelwascher’s Requete on the length of Guernsey’s runway does not seek to extend the RESA, it suggests  reducing the RESA at the eastern end of the runway to 90m, and the potential use of EMAS and other measures, if required. It does not discuss the RESAs in the plural, and that is significant.

In spite of Deputy Kuttelwasher’s challenges to the P&R spokesman in the question time (Hansard line 1010), and a nonsensical response being offered (Hansard line 1019), no correction was made.

All members of P&R including the spokesman voted for the above requête on the 24th Oct 18.

Using existing runway.

2020 Conclusion – FALSE

The spokesman did not understand the subject.

Deputy Trott, Hansard, line 1043: “We have an obligation in Government to be open and transparent. We have an obligation to be honest with our community.”

The following is a comparison between part of the the published version of the statement on the gov.gg website, and the Hansard, where the Hansard version is the struck out text, and the underlined that on the gov.gg website.

© 2019 The 2020 Association

 

Copy of ‘Statement by the Vice-President of the Policy & Resources Committee’

The statement below has been copied here from the gov.gg website simply to add paragraph numbering for easy reference & we've provided blue links back to our analysis. There are material differences in critical areas between this and the Hansard which is a transcription of what was actually said, and these are covered in the analysis page, with a comparison at the end.

The review of air and sea links infrastructure

Wednesday 12 December 2018

  1. “The review of air and sea links infrastructure
  2. Sir, Guernsey’s air and sea links, and the infrastructure that provides them, are critical.
  3. They are critical to our community wellbeing.
  4. Critical to our visitor economy.
  5. Critical to our finance sector – the engine of our economy.
  6. Critical to everyone in the Assembly today – because our job is to protect the interests of those who elect us.
  7. It does not matter which Committee we sit on, what that mandate may be, or which parish we represent. Air and sea connectivity is a States-wide matter, recognised as such in the overall government business plans approved by the States in both 2016 and 2017.
  8. We have a States-owned airline which owns slots at Gatwick Airport, and which meets and exceeds the targets that its shareholder gives it.
  9. We have a commercial ferry operator, Condor, which is meeting end exceeding the targets in its service level agreements.
  10. What we have is good. But to remain competitive, and to remain connected, we know that our community wants better. That is why we, the States, made it a priority.
  11. Back in 2016, the-then new Committee for Economic Development told us it would be bold and brave. But there was little progress on air and sea links.
  12. By the summer of 2017, the Policy & Resources Committee was concerned that progress had been painfully slow. This was for a variety of reasons, but primarily the absence of a clear vision for what was needed.
  13. That was why the President of the Policy & Resources Committee and I submitted an amendment to take forward a review of air and sea links infrastructure, which was wholeheartedly supported and agreed by the Assembly.
  14. The objective was to provide some momentum and some structure to taking forward the work on air and sea connectivity and infrastructure.
  15. During late 2016 and into 2017 the Policy & Resources Committee had undertaken a strategic review of Aurigny. That review came up with a single set of recommendations, including focusing Aurigny towards economic enablement and reduced losses.
  16. Although there were two reports that were part of the review, they were almost identical, with one notable exception – some of the reviewers wanted to build a longer runway; others felt that was not part of the scope of the review.
  17. So it was clear that it was important to look at the pros and cons of extending the runway.
  18. But it was also important to recognise that the future strength of our community’s air and sea connectivity could not be reduced to how long our airport runway is. Such an assumption then, was as foolish as such an assumption would be today.
  19. With that in mind, in spring 2018 PwC was commissioned to carry out initial reports on two things: the factors that we need to consider in order to strengthen our air links infrastructure; and the contingency plan that should be considered given the impending sale of Condor Ferries Limited by its owner.
  20. Let us be clear: we asked independent experts to give us their views on the issues, the options for resolving those issues, and what – if the States was minded – it might do next.
  21. We did not ask them to do a survey of islanders’ or business’ views. The business bodies in Guernsey have undertaken surveys already, and we note their findings. Ultimately, of course, if you ask people if they want better air and sea links they will say yes. We asked PwC to look beyond that, which they have.
  22. Having had the reports back from PwC, in the autumn, we have now shared them with the Committee for Economic Development, the States Trading Supervisory Board and the Committee for the Environment & Infrastructure.
  23. In the first quarter of 2019 Policy & Resources Committee will submit a policy letter for debate and decision by the States meeting. It will set out the recommendations of the Policy & Resources Committee following the completion of the work undertaken by PwC.
  24. Included in the comments and recommendations that will be part of that policy letter will be the following, in relation to the runway.
  25. The Policy & Resources Committee has reached the conclusion that the option of extending the airport runway will not be a game changer in respect of our connectivity.
  26. The truth of the matter is that if were to extend the runway to the length that PwC indicate that it would be a game changer, we would need a huge and complex planning inquiry, probably to bulldoze part of St Peters, and enormous investment on which there may never be a return.
  27. The Policy & Resources Committee does not believe that the community nor the political body has the appetite for that. Therefore spending hundreds of thousands of pounds of tax payers’ money on listing the pros and cons of a set of runway extensions that are unlikely to be built in our lifetime will not be a worthwhile exercise
  28. Of course, this is a government decision, not just a Policy & Resources Committee decision. So in the first part of 2019 the States will be asked to agree the proposition to do no further
  29. work, and spend no further taxpayers’ money, on investigating the permanent extension of the runway.
  30. We should also remember that he States’ Trading Supervisory Board is looking at extending the RESA, as directed by the States, and is reporting back in the first quarter of 2019, and the requerants have said that this might be the solution needed.
  31. So if the States does not agree with P&R’s recommendation, if States Members believe that their parishioners want us to spend upwards of half a million pounds investigating the runways further, then they will have the opportunity to direct the Policy & Resources Committee otherwise.
  32. On such a matter as this, agreed by the States as one of its highest priorities, it is right to ask for and accept the decision of the States. The Policy & Resources Committee will publish the PwC report on air links infrastructure as an appendix to that policy letter, so that all States Members have the opportunity to see the evidence – and indeed, all in our community do too.
  33. As I said, the future of our air links cannot be reduced to a discussion of runway extensions.
  34. The States’ Trading Supervisory Board has supported in Aurigny in the purchase of a new fleet of ATRs. We will debate that policy letter at this meeting.
  35. It may be that combining these two work streams will give us greater resilience, and also provide the opportunity for new operators to come in. We will wait to hear more from Deputy Ferbrache in due course.
  36. The Committeefor Economic Development asked the States to approve a move to quasi-open skies in July, which was agreed despite some doubts, and we wait to see the benefits of that in terms of new routes.
  37. That may be assisted through the airport overhauling its landing charges structure for new routes, supporting the use of the Future Guernsey Economic Fund – established by the Policy & Resources Committee – which can support route development where there is an economic business case.
  38. So catalysed through the review process, steps are being taken that could lead to enhanced air connectivity according to those Committees who have taken those steps.
  39. Let me be clear then, on the Policy & Resources Committee’s position as it concludes its review:
  40. What islanders consistently tell us is that they want frequency; what a longer runway offers is potentially less frequency as larger aeroplanes rotate routes less frequently.
  41. What Economic Development wants is choice; a longer runway does not guarantee choice – airlines could start flying in on the current runway if they see a business case.
  42. · What our island wants is an island airline with the right fleet and a commitment to the island – not a procession of so-called brand airlines cherry picking routes every summer.
  43. Sir, the Policy & Resources committee does not believe a case has been made to extend the runway, so we do not propose undertaking further work.
  44. If the States believes that is wrong the decision, it will have the opportunity to reverse that decision in February and we will of course be bound by that decision in a few weeks’ time.
  45. Of paramount importance is the preservation of our sea links.
  46. We have a commercial operator that we rely on for our passenger, vehicle and freight services, but one over which we have no control.
  47. There is no operating agreement in place with this provider.
  48. This provider also serves an additional, bigger market in Jersey which – perfectly reasonably for commercial reasons – it chooses to give preference to its services.
  49. Reasonable for its own business reasons – but increasingly unacceptable to our community.
  50. Moreover it is up for sale.
  51. And it is suffering under the burden of an impaired reputation following the purchase of a flagship vessel which is not universally admired in our community.
  52. In short – we are vulnerable, exposed, at risk when it comes to our sea links.
  53. This is how we bring in our freight, how many of our teams travel to sports events, how many of our children go on educational and cultural trips, how we go to see our families and friends off-island.
  54. This truly is a lifeline service. But it is operated as a business by a business which cannot share all of our aspirations for this service because it needs to provide a return to its investors. It is not a charity.
  55. Compounded by Condor’s sales process, when it comes to our sea links we are vulnerable, we are exposed, we are at risk.
  56. It is right, of course, that the Committee for Economic Development continues to do what it can to engage with Jersey and the provider to see what service improvements can be secured – both with the business and, potentially, with a new owner, potentially in the first half of next year.
  57. But frankly, P&R strongly believe that our community will not accept that success is more of the same.
  58. In fact, it will, potentially see that as failure and as a missed opportunity.
  59. And, of course we cannot be sure of the plans of any new owner of the provider.
  60. So while it is the role of Economic Development to continue to engage with Condor, it is the role of the Policy & Resources Committee to contingency plan – to prepare for the worst, should a plan B be needed.
  61. The PwC work on sea links looked at four contingency options, and the view of the Policy & Resources Committee is that two of them merit further urgent detailed work.
  62. So in our Policy Letter in February, we will be recommending further independent expert work is undertaken during the first quarter of 2019 to look at the contingency option of a setting up a Guernsey-only, Guernsey-owned passenger, vehicle and freight service, should one be needed; and the contingency option of finding a new operator should the new owner of the current provider decide that they do not want to maintain and improve the services to Guernsey.
  63. We will be commissioning experts to provide further details on investment required, financial modelling, technical considerations and commercial considerations.
  64. These are contingency options. This is contingency planning. Just as we planned and are planning for Brexit, and planned for the referendum, and plan for many other things, so we are planning for our sea links. This is what government must do, and it is the role of the Policy & Resources Committee to provide this leadership. The policy letter will set out what we are going to do and how much it will cost.
  65. But, again, we will be asking the States to agree that work, as this is a decision of importance to the whole of the States and the whole of our community.
  66. In addition, we will work with the Committee for Economic Development to take forward the ramps legislation agreed by the States in 2015, following the approval of a States Report entitled “Strategic Roll on Roll off Ferry Services” which set out the need and justification for establishing a licensing regime for RoRo ferry services.
  67. Given the work that we will be doing, we need to be careful not to undermine any commercial position that we could need to adopt in the future. However, as a government we have a duty to be as open and transparent as possible. No one, regardless of their stake would or should expect anything less.
  68. This means we will provide information on the PwC findings in the policy letter. We will endeavour to provide Members of the Assembly with as much information as we are able to.
  69. Sir, to conclude, many positive steps have been taken on our and air and sea links:
  70. · The strategic review of Aurigny
  71. · A new agreement on supporting new commercial routes through the airport and Economic Development, with a move to quasi-open skies
  72. · Work on the extension of the RESA
  73. · The potential purchase of a new fleet of ATRs
  74. · Progress on contingency planning for sea links
  75. The Policy & Resources Committee has considered these, will now set out clear next steps on the air and sea links structure review.
  76. But it will ensure that the States Assembly – which chose to prioritise air and sea links in 2016 and 2017 – makes the critical decisions on next steps.”

BREAKFAST CHAT – Why Guernsey needs to court, rather than exploit, wealthier individuals

Below is the latest in our series of talking point pieces under the heading of “Breakfast Chat”, intended to provoke thought and discussion.

 

Why Guernsey needs to court, rather than exploit, wealthier individuals.

 

The States of Guernsey Medium Term Financial Plan 2017 made an estimate of capital expenditure needs for the following four years, and proposed raising some £14M of these by “targeted tax measures”.  A continual emphasis in the Plan is that of “those who can afford to pay more, paying more.” Unfortunately, of course, this phrase carries a built-in judgement which means all things to all men. Everyone tends to subscribe quickly to the stated principle without really translating it into actual measures, because not to agree automatically with it risks looking selfish, cold or greedy – and anyway, people also instinctively feel that those who can “afford to pay more” are simply those who are wealthier than they are themselves. However, the tide underlying this philosophy can lead to a dangerous apparent targeting of, and antipathy towards, the very individuals whom Guernsey ought to be encouraging to come or stay here, and to contribute to the island’s prosperity and well-being.

 

It is not suggested that the general concept of “those who can afford more should pay more” needs to be abandoned, but it does need to be applied with caution. Those who can afford to pay more in fact already pay more in general taxation terms, because the flat rate percentage tax imposed across earnings means that they inevitably pay “more”. Once you follow a policy of distorting this basic effect further, by resort to an increasingly “progressive” approach of imposing a higher proportionate burden on “those who can afford to pay more” as individuals, you risk at least three disadvantageous consequences. These risks therefore need to be balanced against any real gain, as contrasted with an illusory one or simply ideological gratification.

 

First, by pressing this concept too far, you create ever increasing resentment amongst the better off. Most of the more affluent members of society will in fact accept that they can reasonably be expected to pay relatively more than others to some degree towards the common need and good, because the proportionately greater money which is taken from them is money which they would use for luxuries rather than the basic necessities of life. However, most of them will also feel that they have come to be “able to pay more” because they have made energetic or prudent use of their talents, opportunities and resources, and that their fortune is not the product of unmerited good luck, but of care, astuteness, hard work, and risk-taking. They will feel that it is therefore unjust to deprive them very greatly of the ability they have created for themselves, to enjoy life with a high quality of assets and experiences, and an improving standard of living, to the full. Like everyone, they only have one life and they too have a right to be able to make the most of it. They will accept an imposition against this to some extent if it is not too great, and there are compensating advantages such as feeling good or gaining respect, but there will come a point at which their goodwill evaporates.

 

Second – and very importantly leading on from this – at the higher end of the spectrum of “those who can afford to pay more”, are persons who are very mobile. They can vote with their feet. They do not have to base themselves in Guernsey; they choose to do so – and the balance of pros and cons affecting their decision to come or to remain will be under constant review. Despite any vague establishment aspirations to make Guernsey one of the “happiest and healthiest places in the world to live”, living in Guernsey has significant practical disadvantages compared with other places. Travel access is often difficult and unreliable, and is famously expensive. The island is small with consequent limitations on experiences. The cost of housing, at all levels, is breathtakingly high. The cost of living is is also high, being on a par with that of Central London but without the access to London’s facilities and entertainments. Most food is imported, making it both expensive (even absent VAT or GST), and less fresh in quality. It is very difficult to get things done promptly and affordably. Therefore, to induce the better off to come and give their support to the island’s economy, it is necessary to make them feel that there are advantages which more than compensate for these downsides.

 

Third, repetition of the mantra that “those who can afford to pay more should pay more” simply encourages law-makers to press this approach, because they see it as a good, popular way to garner votes from those who see themselves as amongst the less able to pay – whose number is, naturally, far greater in vote terms than the wealthier end of the spectrum. The vital point here, though, is that the actual financial gain to be made for the States coffers from from heaping progressive taxation obligations on to individuals who are perceived to be able to “afford to pay more” does not, in practice, bring in a significant amount of revenue, and almost certainly insufficient to have any discernible effect in reducing the necessary burden of tax on others at middle or lower income levels. Its real point then just becomes that of appeasing the less well off by penalising the better off. That is an unworthy approach and should not be allowed to drive policy decisions on progressive taxation.

 

Guernsey in fact needs to cherish and encourage the presence of high net worth individuals on the island. Because such persons are looking for support, in both business and domestic matters, they create jobs – although it does seem that, as many indigenous islanders regard these as unduly menial and Guernsey has enviably full employment, such jobs often go to incomers from the Latvian or Madeiran communities. The more affluent impose less of a burden on States resources because they have private resources which they find it more convenient to resort to, even though at greater cost to themselves. Where they feel welcome, they will use their own resources voluntarily in charitable and other beneficial works for the community. Their contribution to the good of the island is largely underestimated and is ignored by those who see them only in the abstract stereotype of “rich toffs”, or on an “us and them” basis. Facts and figures showing this underestimated contribution were demonstrated last year by the survey carried out by the Open Market Forum, which set out to improve the “image” of the Open Market, following justifiable anger that their property rights and interests had been ignored and overridden by the States when amending the Housing Laws.

 

Guernsey really cannot afford to alienate either the Open Market community, or the more affluent local market community, by making them feel that they are seen simply as a milch cow by politicians with a socialist agenda.

 

An example of this last, mean-spirited attitude has already been implemented by the States in the disgraceful “rolled up” proposal to make rates of TRP on residential properties (ie people’s homes) more “progressive”. The proposal was to impose increased “progressive” rates of TRP in bands, rising according to the increased floor size of the property, but it was claimed that it was “too complicated” to introduce the entire hierarchy of these rising band rates at one time. So in a particularly nasty move, it was enacted, not merely to increase TRP rates generally, but in the same provision, to impose what was ultimately to be the very highest band rate, payable only on the largest properties, alone and in full at the very outset, thereby raising TRP on such properties by an eye-watering 76%. The proposed lower tiers of increased rates for less large properties were to be deferred.

 

It may well have been appropriate to increase TRP rates generally because of inflation. There may also be an argument for progressive rates of TRP for larger properties, – although once again, those individuals who inhabit larger properties are inevitably “paying more” even though their consumption of public services is no greater, and very often less, than those who inhabit smaller properties. But the appropriate approach would have been to bring in the higher bands gradually from the lower levels upwards, over successive years, rather than just to “soak” the theoretically better off at one fell swoop, achieving very little financial gain, just because it was easy to do so, and would doubtless help appease the complaints from the majority of the populace facing a general increase in rates of TRP.

 

The message this discrimination sends to better off individuals is that their assets and wealth are the subject of envy, and that the States will take advantage of any opportunity to try to extract more money out of them, and make them pay extra for their good fortune. Such an attitude will deter from our island just the kind of individuals whom we should be seeking to encourage to join us, and to contribute – by investment, energy, goodwill, job creation and voluntary contributions, – to our society and its prosperity.

 

At present, one of the attractions of Guernsey to the well off is that it still appears to believe that an individual’s money is, in principle, his own to do what he likes with, and government should take in taxation only that which is required to ensure the security of the population, to provide necessary infrastructure and services as required by all, to support those who, through no fault of their own (the young, the old, the infirm, the temporarily jobless) need financial support from the community in general, and otherwise to facilitate individual enterprise and responsibility. It has not yet fallen into the mind-set that an individual’s money really belongs to society at large, and government is entitled to decide how much it will graciously allow the individual to spend on himself. Guernsey needs the well-off and it must think of means to attract them – although this of course extends beyond the purely financial, to matters such as a high quality education system, attractive environment and general quality of life. Guernsey cannot, however, afford to appear to have a socialist agenda.

 

Bemused of Torteval

© 2019 The 2020 Association

BREAKFAST CHAT – A medical consultant’s thoughts on the Guernsey health system

Below is the latest in our series of talking point pieces under the heading of “Breakfast Chat”, intended to provoke thought and discussion.

A medical consultant’s thoughts on the Guernsey health system

First some history. Forty years ago in Guernsey, primary and secondary healthcare (ie general practitioners and specialists) were combined in several private medical practices. This was perhaps an unusual solution, in view of the size and remoteness of Guernsey.

 

It was an entirely private system funded by the patients themselves, often through various health insurances such as Oddfellows, and Foresters, and the more usual commercial insurers, such as BUPA. The States of Guernsey helped those on social benefits.

 

All private practising doctors covered the emergencies at the Hospital by a rota system through what was then called the Receiving Room – which went on to be called “A and E”.  

 

That system made life very varied  and interesting for practitioners and it worked well. It was also relatively cheap to run, with sharing of costs and overheads. Patients were also seen much more quickly, because referrals were within the same structure. The only real difficulty with this model was the expense of major surgical procedures for people who chose not to take out insurance (or were unable to do so and yet not on incomes low enough to entitle them to states benefits). They were in a minority, though, and of course could make arrangements with their practice to pay the bill over time, or the bill would sometimes be waived, and thus the losses were shared.

 

In the early 1990s, the States then effectively intervened and insisted that specialists and GPs should separate, and that the specialists should form their own private practice. They said that their aim was to provide a “more balanced” service. They were also concerned to limit the number of consultants who could practise.

 

The Medical Specialist Group was therefore formed, in effect, at the behest and the insistence of the States, with the agreement (although reluctantly in some instances) of the specialists of each practice. The States did not, however, provide land or accommodation for the new specialist group, and the doctors themselves, therefore built the specially designed MSG building.

 

Approximately two years after the MSG was formed, the States resolved to introduce a compulsory insurance scheme for secondary care.  However, they were unable to find a reasonably priced, inclusive, insurance company provider and so they chose to fund the system themselves, as they have been doing ever since.

 

This was arguably a mistake; the Board of Health lost the chance of a better system when they concentrated only on secondary care, and making that free at source.   

 

A contract was concluded between the Board of Health and the MSG, renewable at regular intervals with reviews on performance criteria as to waiting times for appointments/operations etc. However, within the contract there was no consideration given to criteria to monitor the clinical outcomes of this system. This seemed strange. However, this contract has soldiered on over the years. It is now past its sell-by date and there needs to be a total review of both primary and secondary care systems.  

 

Primary care has been largely ignored by politicians to date, and the GPs have been able to develop their practices, largely without any States involvement. The current contribution made by the States to each patient consultation fee is now wholly unrelated to the actual cost, so that the actual patient contribution is way above that of the States contribution.

 

The initial MSG contract put extreme pressure on the consultants to see new patients speedily and within set time frames. However the GPs did not act as efficient gatekeepers, and there was no real incentive to them to do so.It was probably easier for them to pass patients over to a specialist, even though their treatment was well within the GPs’ own capabilities. The GPs were no doubt also under pressure from the patients themselves to be referred to specialists, as that was entirely free to the patient. The actual referral rates were therefore extremely high, compared to other systems like the NHS. This also, would tend to lead to some GPs becoming de-skilled in the management of conditions that would, historically, have been managed by them – as they were and have continued to be in the UK.  

 

The time is long past to get to grips with the entire system of primary and secondary care.  

 

The States of Guernsey, through the Board of Health, gradually became increasingly directive of the MSG, and this has gradually eroded the consultants’ incomes. This has led to the extraordinary situation under which primary care doctors, remaining entirely private, have been left alone to charge what fees they want, whilst consultants have been subject to constraints. It is believed that the result has been that GPs now earn significantly more than consultants.

 

The States appears to have been trying to develop a system which resembles the NHS. This is sad and misguided, as the NHS system itself has real problems, and is deeply flawed. There is a common pattern in Guernsey, to follow many years behind trends in the UK, but then to ignore the flaws which have come to light through experience, and blindly just decide to follow in the UK’s footsteps. The way in which the education system has been changed is yet another example of the States failing to take into account the outcomes and demonstrated problems of systems tried by others, and from which they have the opportunity to learn.

 

Sadly, and in the same vein, there has been a vast increase in the number of administrators in the health system in Guernsey over last 40 years, with all the attendant bureaucracy, resulting in decision-making being slow and unwieldy. Members of the medical profession who were dealing with States officials came to spend an inordinate amount of time in committees, discussing the same thing month after month, without leadership or effectiveness from the Department of Health. One example is that specialist obstetricians tried to discuss the problems which they saw in the midwifery service with States officials, but were firmly reminded that this was not their business, as the system was run by the civil servants. Scant regard was paid to the views of the specialists; the officials seemed uninterested in the views of the actual professionals. We all know what happened, then. A predictable and avoidable incident caused the Department of Health much heartache, expense, resignations and political upheaval.   

 

The result of that incident sadly being the death of a baby, the States then decided to introduce a very expensive, UK type system of overarching regulation, when, frankly, a simpler, more appropriate, less expensive and “Guernsey friendly” solution should have been introduced.  This has arisen because the people who were engaged by the States to look into the problem and come up with a remedy, were commissioned from the UK, and therefore, having only the experience of the NHS, they come with both a lack of wider imagination and a predisposition to think that only the NHS systems, which they are used to, provide the answer. They ignore and overlook the different needs of a small island, and what is really appropriate here.

 

As regards the future, it would be good to see:

 

  1.  More input from the medical professionals into health care, and less micro-management from politicians. This has been a common negative feature of various committees over the years.

 

  1.  More investment into private care (eg expansion of facilities for private patients/more private rooms and care/separate theatres  for private patients). This could be be funded either by the States, or by private  investment – and it could surely be a very good income generator for the island.

 

  1.  The encouragement of private health insurance by giving tax breaks for premiums and to reduce cost to the States.

 

  1.  A recognition that if the system continues to erode the standard of living of consultants, there will inevitably be more problems with recruitment and the standard of service and the calibre of consultants will fall.  

 

  1. Consideration being given to a method of taking more control of GP practices to bring down costs and to save States money by ensuring that there are no inappropriate referrals to “free” specialists.

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