ISLANDERS who were overpaid by a scheme designed to protect jobs during the pandemic could have up to five years to pay back the money if they set up an instalment plan, the director general of Customer and Local Services has said.
Ian Burns has moved to reassure business owners who had been left worried after they claimed to have received letters asking for repayments to the Co-Funded Payroll Scheme to be made within 14 days.
He said the time window is for business owners to set up an instalment plan for how they will pay the money back.
His comments come after a number of small-business owners told the JEP that they had been left stressed, struggling with their mental health and some said they had to close due to being asked to repay money which they had been given through the scheme.
Earlier this year the JEP reported that around 270 self-employed people had received letters demanding repayments totalling up to £1.9 million that was paid out under the initiative.
Mr Burns said: ‘When sole traders and business owners applied to the scheme, a lot of them listed their full turnover, rather than the amount of money which they would take out of the business for themselves – this is what has led to the overpayments.’
‘We have been following a process by calling people up to let them know of the overpayments and then sending them a letter. The letter is to remind them to make an instalment plan.’
When the scheme was first launched, the government website stated that for phase two of funding, which was focused more on self-traders and self-employed, ‘you should claim for the total gross average monthly income through one business at the end of the month that you are claiming for’.
Mr Burns added: ‘We want to reassure people that they do not have to pay the money back in 14 days. They can set up an instalment plan and have up to two years to pay it back. Depending on their individual case, they could have up to five years to pay it back. However, in order to do this, businesses need to get in touch in order to set up a plan. We are not asking people to pay back all the money they were given, it is just the amount they were overpaid.’
Last month the Corporate Services Scrutiny Panel published its report on the scheme and found that communication about the guidelines was ‘misunderstood’, which had led to cases where those who were meant to be benefiting from the scheme had been left in debt to the government, despite providing information in ‘good faith’.
The panel recommended any future scheme include a right to appeal for those who were being asked to pay money back.
Senator Kristina Moore, who chairs the panel, said the auditing of the initiative had left some Islanders ‘feeling persecuted, unduly accused, stressed and, in some cases, facing years of debt’.
However, Treasury Minister Susie Pinel has rejected all the recommendations made by the panel.
She said: ‘Formal appeal processes are often time-consuming, bureaucratic mechanisms that are not appropriate for a scheme of this scale, which received over 27,000 individual claims.
‘Islanders had recourse at all times by contacting CLS officials managing the scheme and ultimately the Treasury Minister should there be issues that would necessitate potential changes to the rules of the scheme or judgments made by officials. This process allows for the same benefit of an appeals process but is able to operate in a leaner way. In many cases it will also have allowed for more timely responses to be made.’
She added: ‘Extensive efforts were made to ensure that the rules of the scheme could be understood by members of the public. This work was done under acute time pressure given the urgent need to provide support to businesses while the stay-at-home order was in place. I am satisfied that the government did everything it reasonably could in the context.
‘In future, we would make similar efforts, but anything we do will always be imperfect and some people will not understand or chose not to read the guidance provided despite our best endeavours.’
