‘We are moving into an age of intellectualism – the age of ideas’. This quote was given by James Sproule, Chief Economist and Director of Policy at the IoD, who was the opening speaker at the 2015 IoD Annual debate. Guernsey needs to become a ‘Pretty City’ in order to give us an edge in this new ‘age of ideas’. Our challenge is to make it easier to live here and attract more entrepreneurs. The ‘Undercover Economist’, Tim Harford, was the guest speaker who gave the original analogy of economic forecasting being like Pringles – ‘entertaining but not terribly nutritious.’ Being an actively open-minded thinker is the key to successful forecasting. Optimism and stubbornness lead to the downfall of Irving Fisher so Guernsey needs to learn from his mistakes. The ageing demographic cannot be ignored. Chris Brock, Managing Director of Island Global Research, summarised the analysis of Guernsey as an island by suggesting the next steps that need to be taken; forward thinking and innovation, a long-term economic and social vision, connectivity in the Government and the community and improvement in the infrastructure.
Population, innovation, taxation and pensions. These were the four main topics of the debate, which was expertly moderated by Sarah Montague. The panel was made up from Mel Carvill, local businessman, Wendy Dorman, Chairman on the Jersey IoD, Deputy Johnathon Le Tocq, Chief Minister of Guernsey, Geoff Miller, local business man and Jane St. Pier, Chair of the Youth Commission.
‘How big is the problem?’ The answer – extremely big. The demographic time bomb is an underlying problem that affects every other problem. Currently for every 100 people working, 53 are supported. This is going to rise to 80 people being support for every 100 working. Mel Carvill raised the seemingly unpopular suggestion of engineering an increase in the working population. Our insurance fund is unsustainable and more money needs to be brought in somehow. Another proposition would be to reduce benefits which I personally feel is an excellent idea. This would encourage more people to become economically active, therefore more money would be coming in and less going out.
Wendy Dorman made the point that having a population number is not necessarily the right way to approach policy, as it is too difficult to control. It would be better to train people on Island rather than bringing in new people. Jersey has put a population policy in place to have a net immigration of 150 families a year and the demographic time bomb is still a massive problem. Jane St Pierre further emphasised this point, expressing that we must realise the potential young people have and enforce education, resilience and interpersonal skills.
If we want to maintain our standard of living, we have to increase the population. The majority of people in the room seemed surprisingly relaxed about a 15-20 thousand increase in the population as long as the rate of this increase is carefully monitored. The next thing to consider is who we are opening the doors to. It was suggested that our target should be the ‘young high earners’ which then highlights the prominent issue of how we attract them. My initial and most pressing thought is to lower house prices. It is unreasonable to expect a vast majority of young people to remain in or return to Guernsey with the house prices as they are and the lack of opportunity. Diversification of the economy needs to happen. Geoff Miller said that for this to happen there needs to be an investment in skills of future employees. I agree to some extent but I don’t think that this should be
the sole focus. I believe it would be more beneficial to expand our industry portfolio which would encourage more of the future employees to stay. It works both ways, with an influx of people will come a natural growth in the diversity of careers and the development of Guernsey and vice versa.
Possibly the most unpopular proposal made was the increase of taxes. People need to think realistically here. The UK tax more heavily than Guernsey and have fewer benefits. If the current workforce is not willing to pay more towards their pensions, why should we be expected to do exactly that? It seems like the current workforce are expecting this concern to be fixed entirely by the next generation. We need to work together, sharing their experience with a new mind set. It is imperative that our views are heard, as in a situation like this we are going to be largely affected. It is in everyone’s their best interests for this to be resolved.
We need a vision, we need to make a decision and we need to be proactive.
