By Ben Shenton
I WAS going to write about how the States of Jersey is looking to hide debt through the de-consolidation of 100% owned subsidies, using questionable – but legal – accounting practices. However, while very important, it was too boring, so I decided to write imaginary sketches based on two of my favourite television programmes – Minder and Yes Minister – instead. For younger readers – Arthur Daley was a lovable rogue, and Terry was his “minder”.
Arthur Daley’s Guide to Debt Management – Jersey Style
Terry walks into the office, looking concerned.
Terry: “Arthur – your accountant’s on the blower. He’s worried about the amount of debt you’re racking up.”
Arthur: “Don’t worry, Terry. I’ve got it all in hand. You see, there’s an art to managing debt levels. You just need a bit of imagination.”
Terry: “But Arthur, Daley Enterprises is up to its neck in it!”
Arthur: “Ah, but that’s where the magic happens. All the debts are in Daley Enterprises and three of my little side hustles: Daley Homes, Daley Development and Ports of Daley. Each of them is looking to borrow a few bob – £100 million here, a couple hundred million there. And don’t forget the new HQ – that’s another £93 million we don’t have.”
Terry: “So what’s the plan?”
Arthur: “Simple. At the moment, all their debt shows up in Daley Enterprises’ accounts – sticks out like a sore thumb. So what you do is de-consolidate the others, make them look like totally independent companies. That way, their debt disappears from the main books. Of course, they’re not really independent – but everyone’s happy to play along.”
Terry: “And the HQ?”
Arthur: “Ah, that’s the clever bit. I’m using the Daley Enterprises Pension Fund to buy it. I’ll give the trustees a loose “guarantee”, they’ll sign it off, and I won’t have to borrow a penny. That’s £93 million off the books, just like that.”
Terry: “But isn’t that risky?”
Arthur: “Risky? Terry, it’s genius! By doing it this way, I can potentially avoid reporting well over half a billion pounds in debt, and no one’s any the wiser. It’s what I call Arthur Daley Debt Management.”
Commentary: in the 2024 Accounts, Ports of Jersey has a £60 million credit facility and a loan of £3.3 million secured against a workboat. Andium Homes had a £225 million credit facility, and a £100 million private placement loan. Jersey Development Company had debts of £36.6 million and is looking to undertake some major developments. All three entities may need to increase borrowings. The amount of debt being moved off the main States of Jersey balance sheet could exceed half a billion pounds. I believe the purchase of the new government headquarters by our Social Security Fund only makes sense from an investment viewpoint due to a commitment given to repurchase the land and building at the end of the lease at a price that ensures the return over the period is RPI plus 3% – the target return of the fund. However, the government have given no irrevocable commitment to do this, they only committed to an option that “is projected to be exercised”. My opinion is that the Trustees should have got a cast-iron commitment as the investment viability hinges on this.
“Yes Minister, But Not Yes to Carers”
In a scene that could have been lifted straight from the BBC’s Yes Minister, the compassionate Minister Lyndsay Feltham finds herself locked in a battle of wits and wills with the ever-obstructive Sir Humphrey Appleby, a civil servant whose loyalty to bureaucracy rivals his salary.
Minister Feltham (reading a letter): “Mark Jones. Widower. Full-time carer to two disabled adult children. Denied his pension because he receives the Home Carer’s Allowance. Humphrey, this is outrageous!”
Sir Humphrey : “Ah, Minister. I see you’ve discovered the Carer’s Conundrum. A most delicate matter. Touch it, and you risk unravelling the entire benefits tapestry.”
Minister Feltham: “People are suffering. Mark Jones has contributed all his life and now he’s being punished for caring. It’s inhumane.”
Sir Humphrey (smiling thinly): “Minister, the system is not designed to be humane. It is designed to be administratively efficient. Humanity is notoriously inefficient.”
Minister Feltham: “Guernsey changed their law seven years ago to allow carers to receive both pension and allowance.”
Sir Humphrey (sniffing): “Yes, well, Guernsey has always been rather cavalier with their legislation. They even allow people to be compassionate when considering government policy.”
Minister Feltham (deadpan): “Yes, and oddly enough, their carers don’t have to choose between dignity and dinner. It is a breach of their human rights.”
Sir Humphrey: “Ah yes, human rights. A splendid concept. Very popular in Strasbourg.
Minister Feltham: “And the cost of changing the law is only £220,000, which will improve the lives of so many good people. Isn’t that about the same as your salary package?”
Sir Humphrey (suddenly alert): “Actually Minister, it’s slightly less.”
Minister Feltham (dryly): “Yes, ironic, isn’t it? One civil servant’s salary could restore dignity to a meaningful number of carers.”
Sir Humphrey (defensive): “Minister, if we start paying pensions and allowances simultaneously, what next? A realistic period to qualify for a full pension? Enhanced benefits appropriate to real life in Jersey in 2025? A government that actually cares?”
Minister Feltham (firmly): “I’m meeting with Mark Jones and I intend to tell him we’re changing the law.”
Sir Humphrey (resigned): “Very well, Minister. But I must say – putting the public first is a very…interesting…approach.”
Commentary: In Jersey, carers like Mark Jones are denied their pensions if they receive the Home Carer’s Allowance – a policy Guernsey wisely abandoned in 2018. The cost of change? £220,000. The cost of doing nothing? Dignity denied to those who give so much. Perhaps it’s time Social Security asked not what’s administratively efficient, but what’s morally right.
Ben Shenton is a senior investment director. He is a former politician, Senator, who held positions such as minister, chair of Public Accounts Committee, and chair of Scrutiny. He also assists a number of local charities on an honorary basis.
