States Members yesterday unanimously approved a proposition from Treasury Minister Susie Pinel to borrow the money and establish a Fiscal Stimulus Fund.
The money will be available in two equal tranches, with government departments, arm’s-length organisations and not-for-profit groups able to apply this month and in February for support for projects designed to boost the economy immediately and create jobs.
Up to £5m will be available per project, and each initiative should aim to be complete by the end of 2021.
Richard Corrigan, the government’s chief officer for financial services, digital and enterprise, said that renovating the Jersey Opera House and ‘green’ initiatives could be among the projects supported by the fund. (Full story: page 2.)
Deputy Pinel said the projects, which would be assessed against various criteria by an oversight group for the fund, needed to be ‘timely, temporary and targeted’. She said submissions should not be designed to replace existing capital projects to ensure they were supplementing the economy beyond existing measures.
The minister added that the borrowing, which would be facilitated by the Island’s revolving credit facility already in place, was expected to cost around £395,000 a year. Around £250,000 of the £50m will be used to administer the fund, including the recruitment of someone to lead the programme and an administrator.
‘I can assure Members that the plan to establish this fund has been well researched and a range of fiscal stimulus measures are part of our way to support Islanders and our economy,’ she said.
She added: ‘Jersey is a place of ideas and energy and I feel confident we will have a range of projects which can benefit our economy.’
An amendment from Deputy Kirsten Morel aimed at ensuring the diversity of those who will benefit economically is considered when projects are assessed was accepted by the minster and ultimately approved as part of the proposition.
He also asked for a report to be published once projects had been identified so that Islanders could understand how each one would bring benefits to the economy.
Deputy Pinel sought to reassure States Members that the fund and projects supported by it would be subject to all the financial governance measures already in place in government. Each project will need to have a departmental sponsor and will be allocated an officer to oversee the process.
The oversight group would also monitor projects on a monthly basis and could use internal audits where appropriate, she added.
There are no plans currently to top up the fund in the future, although the economic situation will be continually reviewed.
A number of Members spoke during the debate, including Deputy Geoff Southern who asked if lessons had been learned from the experience of the Jersey Innovation Fund, which he said had ‘serious flaws in its governance’.
Deputy Rob Ward said the Fiscal Stimulus Fund was appropriate given the circumstances but there were some issues to be wary of. He said the oversight group needed to be clear and transparent in its membership. And he added: ‘We don’t want it to be a slush fund for large companies which have friends in government.’
The Fiscal Stimulus Fund is one of a number of measures devised by the government to support the economy during the downturn prompted by the Covid crisis. More than £1.3m of payments have already been made to support low-income Islanders during the pandemic. More than £10m of the £11m available through the £100 Spend Local cards given to every Islander was spent, with around 2,000 local businesses benefitting. In addition, from October Social Security payments for around 55,000 Islanders have been reduced by 2% in a move designed to put millions of pounds back into Islanders’ pockets.
Jersey Water has previously said it intends to apply to the Fiscal Stimulus Fund for £4m to extend the mains water network and connect 500 further properties in 2021.
