Manifestos part 6: States departments

Manifestos part 6: States departments

ADVANCE JERSEY

WE consider Social Security and Home Affairs to be among the better-run aspects of government. However, we are concerned that the Long-Term Care tax is not the right way to approach the problem of an ageing population and believe it will prove to be an unbearable tax burden in time. We will look at alternative options for funding LTC. We respect those who provide our uniformed services, believing they do a good job, but consider that too much of our uniformed resources are occupied by carrying out minor functions that would better, more cost effectively, be provided in other ways. We see no need for a Housing Department. External Affairs are sufficiently important to come under the direct purview of the Chief Minister. The Treasury is perceived as ponderous, set in its ways and obstructive of progress in areas such as a new approach to taxation and economic stimulus initiatives; it will receive the fresh, firm political direction needed.

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BIG PLOUGH

BIG Plough welcomes the declared commitment of the new States chief executive, endorsed by the current Council of Ministers, to placing the needs of individual citizens at the centre of Jersey’s public service ethos.

We will propose that the same spirit is applied to States procurement, with a requirement always to use Jersey-based craftsmen, contractors and other goods and services providers unless there is a demonstrably compelling reason to look outside the Island.

In the interests of population control and social cohesion, there should be a policy of positive discrimination in favour of established residents when public sector appointments are made. Successive administrations have promised for decades, and failed for decades, to establish full career progression and it is time for that to change.

There are some reservations about the detail of the proposed reform of the States departmental structure but we endorse the general streamlining principle behind it, provided it achieves the aim of directing more resources to front-line services in areas such as health and education, and we reserve judgment.

Whatever the new administration may look like, the changes should be followed by an intensive war on the spin and jargon increasingly used by civil

servants and politicians to comfort themselves and confuse the public. They work for us, not the other way round, and all communications should be honest, plain and timely.

Much will depend on a renewed willingness by elected politicians to challenge the increasingly undemocratic power network of civil servants, quangos, commissions and so-called arm’s-length organisations which has proliferated in the past few years. A review of these organisations, their compositions and the relationships between them should be undertaken alongside departmental reform, with the twin aims of saving money and restoring democratic control. Scrapping the doctrine of ministerial collective responsibility will help, as will the overdue growth of new political parties and alliances.

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ASPIRATION JERSEY

DESPITE pockets of excellence in our public services, overall the culture and ethos of the States is all wrong. Most departments are dominated by producer interests – managers and unions wrestling with one another – and with bewildered ministers and entrenched, vested interests and obsolete work patterns. Those consuming these services – who are also paying for them – often scarcely get a look-in. After all, as the present Chief Minister rashly admitted, ‘It is a government that is focused on itself and serving its own ends, not focusing on Islanders that we are here to serve’. Whose fault might that be?

The future of our States organisation depends on a seismic shift away from the inward-looking preoccupations that absorb so much energy and attention, towards a user-focused approach prioritising client needs, efficient delivery, responsiveness and cost effectiveness. We support the plan being rolled out by the new head of the civil service, while noting that previous initiatives have foundered for want of political commitment.

Radical change is needed, and radical change is coming if we’re elected to government. We will conduct a thorough review of all services across the States and subject them to four crucial tests:

lTaking into account cost and resource commitment, is this service needed at all?

lIf needed, has it been properly attuned to the requirements of those using it?

lIs it accessible through the use of digital technology for delivery where possible?

lIs it efficient and cost-effective, using the private sector as a benchmark?

Any service that fails the first test will be terminated. Any that fails one or more of the other three will go under the microscope without preconceptions, and will be improved, relaunched or outsourced as appropriate. We anticipate that many existing services will qualify for remedial action.

Over the years, our government has become used to spending money to dig its way out of holes or generate a sugar-rush of public acclaim. But writing cheques is the easy part – making sure they don’t bounce is harder. The interests of those financing the States through taxes on our hard-earned incomes, on our expenditures and on the profits of our businesses, have not been taken seriously enough. The present government leaves behind a litany of costly crowd-pleasers that end up pleasing few. This too must, and will, change.

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FOR A BETTER LIFE

OUR current idea of pensions and benefits developed during the 20th century. In Jersey, Senator Philip Le Feuvre brought in a social security pension scheme in the 1950s, when a man aged 65 could expect to draw his pension for thirteen years. Since then life expectancy has increased significantly; a 65-year-old today can look forward to twenty two years of pension payments and this is likely to rise even further. Spending nearly one-third of your adult life as a pensioner is putting an enormous strain on our pension scheme. Assuming that we can rely on investment returns from the pension fund to cover these increasing costs is unrealistic. The current States policy of unfettered immigration is masking the size of this problem, but this is also unsustainable. Bringing in more workers to cover today’s pension costs will just create a larger pension cost for the next generation to bear.

It is time to redefine our ideas of retirement and old age. At age 65, many workers are still healthy, they are experienced and often have a deep knowledge of their job. Fewer jobs these days require strenuous manual effort and many workers can continue to be economically productive well after their official pension age.

In the short term, a phasing-in of pension entitlement would help to contain the cost of the pension scheme. For example, pension payments could start at 20% of the full value, giving workers the opportunity to reduce their working week by one day. The phasing would continue according to an individual’s request, with the pension value gradually increasing up to 100% and the working week, reducing until the worker works one day a week and then retires completely. This would improve the productivity of the local workforce, helping to maintain tax income and reduce the need for immigration.

A more radical solution that should be seriously considered is the concept of a basic income for all adults. Basic income systems are now being investigated in several countries around the world. Every adult receives a standard payment each week, designed to cover basic living costs. Providing this to all age groups would make our benefit system much simpler and remove the need for bureaucratic means tests. As the income is paid to adults of all ages, there would be no need for a separate pension scheme and no need to define a specific pension age. Workers would choose when they wanted to stop working or reduce their hours.

Our current concept of work may well be up for a change as well. Robots and artificial intelligence will play an increasing role in many activities, replacing many routine tasks. Workers in Germany have recently negotiated the right to work a 28-hour week to allow them to improve their work-life balance. Establishing a basic income would also help with this transition to shorter working weeks and allow people to take on more community activities, developing neighbourhoods and supporting vulnerable groups.

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JERSEY TOGETHER

REGARDLESS of whether we’re on benefits we all have a stake in the social security system. Whether this is directly in terms of benefits we will one day need (such as pensions), or indirectly in terms of the taxes we pay, it affects everyone.

There have been some positive developments recently. We support the family-friendly employment rights package that was proposed by the Employment Forum. We support the sustained efforts to encourage people on benefits back into work. Welfare should always incentivise work.

However, we want to suggest two projects that could transform social security.

For low-wage jobs, income support is effectively a taxpayer subsidy to businesses. It allows employers to pay below a living wage, with the tax payer topping up income. We believe that the taxpayer should not be subsidising a low-wage economy. Therefore we propose to steadily raise the minimum wage until it reaches the level of the Living Wage – an amount upon which a person can afford to maintain a normal standard of living.

This will save money by reducing the bill for income support. It will also act as a stimulus for businesses to increase investment and find ways to improve productivity. And it will increase the self respect and dignity of people who find themselves at the margins of society. Yes, it will affect the business model of some businesses. Yes, it might lead to price rices. But we believe the enormous benefits justify the change.

Under any realistic scenario, the number of pensioners is going to increase over the coming years as the number of working-age people drops. Therefore, tax income will fall as pension payments increase.

The Council of Minister’s solution is to increase immigration so that there will be enough new workers to keep paying the pension bills. But this means the problem just keeps getting bigger.

It’s time to consider a radical new approach. Jersey Together believes that we should investigate transferring pensions into a social insurance scheme. This would allow everyone to build up their own individual pot of money which would pay a pension in old age. The present ‘pay as you go’ system would be transformed into a fully funded system that makes no claim on the public finances. This is a system that would build on Jersey’s traditional virtues of self reliance and independence.

The basic principle is simple. Throughout your working life you (and your employer, if you have one) pay a proportion of your income into a centrally managed fund. Over time you build up a pot of money in a personal account. Come retirement, you use the money in your account to pay a pension.

Versions of this system operate in a number of countries; perhaps the most relevant of which is Singapore, where it has widespread support. One of the advantages of the system in Singapore is its flexibility; you can borrow from your individual account to pay for education, health care or housing.

Jersey Together proposes an Islandwide commission to investigate the feasibility of shifting to a social insurance scheme.

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