Senator Maclean today said that several proposals were being looked at to address fears that States pension payments may become unsustainable in the future as people are living longer.
The suggestion has fuelled yet more concern among business leaders that ministers are further shifting the burden of reducing deficits onto Islanders before properly addressing the question of how the public sector can be made more efficient.
Chamber of Commerce president Kristina Le Feuvre has called on the States to go further with streamlining the civil service, to support local business more and to review its population policy to encourage economic growth.
One suggested measure to help ensure the States can afford States pensions in the future is increasing the age at which Islanders are entitled to receive their state pension, currently 65 years old but rising incrementally to 67 by 2031.
Proposed cost-savings also include revisions to public-sector pension schemes such as basing the pay-out on an employee’s average salary over the course of their career rather than their salary at retirement.
Senator Maclean said: ‘We are reviewing the Social Security fund to establish what changes may be needed in future to ensure that our state pension is affordable as the population ages. We may have to increase the age at which we receive a state pension.
‘We are also moving from a final salary to a career-average pension scheme for public-sector workers to help us manage the cost of an ageing demographic.’
The Treasury Minister said the proposals would make pension payments in the future ‘more affordable’ and were in line with the standards of most organisations.
Following the release of the States’ draft Medium Term Financial Plan last week – which sets out their financial plans for the next four years – Mrs Le Feuvre provided a number of comments and suggestions about matters she would like the States to deal with.
Aside from addressing future pension costs, Mrs Le Feuvre called on the States to go further with streamlining the civil service, to support local business more and to review its population policy to encourage economic growth.
She praised the States plans to cut back public-sector costs but said that she hoped to see them ‘followed through in a timely fashion’ and pointed to the e-gov initiative – which aims to use computer technology to reduce reliance on staff – as an example of a ‘cost-effective and fit-for-purpose’ solution.
She also suggested measures to boost the Island’s economy, including the introduction of a formal policy of the States buying goods and services locally to help Island businesses, tax credits to help businesses, longer term States planning and the speeding up of the planning application process.
She added that business tax credits would ‘help those who help themselves’ and longer term States plans would help improve confidence in the business community.
Mrs Le Feuvre also suggested that a ‘more pragmatic approach’ was needed to importing people to the Island who could help deliver economic growth.
The Treasury Minister Alan Maclean said that he welcomed the Chamber of Commerce’s comments and looked forward to holding further discussions with them in future.
He said public-sector reform, including e-gov, was at the very heart of the MTFP and their plans showed ‘no lack of urgency’.
The minister also said the States’ procurement policy already looked to local businesses for supplies but added that it must be balanced with delivering good value and he said the Environment Minister was ‘working hard’ to speed up the planning system.
With regard to population policy, the minister said: ‘We will always assist businesses looking to recruit key staff from outside of the Island.’
IF, for a minute, we park the question of how the Island got into this fine financial mess and call a halt on the blame game, there are some serious questions to be asked about whether the proposed road map to recovery is being followed.
At the last count, the projected potential black hole stood at £145 million and we now know how the Council of Ministers proposes to reduce the deficit while also focusing extra spending on education, health, the regeneration of St Helier and fostering economic growth.
Wind the clock back a few months and the direction of travel was clear. Treasury Minister Alan Maclean said that new taxes would be a last resort. The focus was on cutting spending and finally bringing in check the cost of a burgeoning civil service.
That was not a comment on the quality of many hard-working and highly skilled people working for the States, but a statement of the obvious. The public sector could be more efficient, and everyone knew it.
Last week, the Medium Term Financial Plan was released and in it a raft of measures aimed at filling the black hole. There were cuts here and cuts there, many unpopular, but all aimed at a very necessary goal.
There were also proposed new charges for health and the disposal of sewage. Maybe not taxes in the semantics of political debate, but very definitely new taxes to everyone else.
Today, we learn from Senator Maclean that the age at which Islanders are entitled to a States pension might rise – again.
The question is whether there has been a distinct, but underplayed, change of tack?
Have ministers really gone as far down the path of efficiencies and savings in the public sector as they led us to believe they would all those months ago?
Has Kevin Keen, a man brought in with a clear remit to bring some private-sector reality to the States bureaucratic monster, had his wings clipped by the mandarins who run this Island? Has he been denied the details he needs?
Yet again, Islanders are left seeking reassurance from their government in the face of a communication strategy which tells only part of the story. There seems to be a strange siege mentality among those on the upper floors of Cyril Le Marquand House. If there are people banging on their door downstairs, it is because they want information not blood.
