THE Island’s government spends less per person than the UK’s, a new report has revealed.
The gap was even bigger when the sizes of the jurisdictions’ economies were factored in.
However, officials have said that the results would be expected in a lower-tax jurisdiction.
The Treasury Department has published the Island’s first Classification of the Functions of Government (COFOG) report.
It breaks down the public sector’s spending habits into ten internationally recognised categories such as health, education, and public order and safety.
The report, which is designed to allow comparisons to other jurisdictions, revealed that where Jersey spent £13,753 on each resident in 2021, the UK spent £16,396 – and when that figure is adjusted to take in the size of each economy, the gap is much larger.
A statement accompanying the report added: “Jersey spends less per person, and less as a proportion of the economy than the UK, as would be expected in a lower-tax jurisdiction.
“Whilst the standardised approach will aid transparency, it remains important to recognise that analysis of expenditure is only one part of understanding how governments use taxpayers’ money.”
The largest chunk of the Island’s public purse – 32.7% of it – was spent on welfare, which includes income support benefits and social housing, a figure largely similar to the UK.
The second-largest was on health services, with 28% of government expenditure on health services in 2022, equating to nearly £4,000 per person, and 28.5% in 2021 – comparable to 20.5% in the UK.
The report states: “Unsurprisingly, this functional category accounts for a significant proportion of government sector expenditure.
“Health care requires significant fixed-cost expenditure, and the Jersey health service is required to provide a comprehensive level of service.”
In 2022, Jersey expenditure on hospital services specifically included a charge relating to the Our Hospital project of £8.4m.
Jersey also puts twice as much money into environmental protection as the UK – 3% of its expenditure, as opposed to 1.5% – but this is partly due to privatisation of waste-water management in UK, something which is paid for by Jersey’s government.
However, Jersey spends much less than the UK on public debt (due to low levels), defence (which is largely provided by the UK), financial support for individual industries, and housing and community amenities.
Treasury Minister Ian Gorst said: “The COFOG classification, recognised as an international standard, is an essential tool for promoting transparency and accountability in government spending.”
In 2019, the States approved a proposition which required all States expenditure to be classified in accordance with the United Nations COFOG system, which has been adopted by most large economies.
