P&R's two-pronged budget approach under fire

Politicians have expressed dismay at Policy and Resources' (P&R) budget for 2027, stating it does not do enough to support ordinary islanders.

Deputy Adrian Gabriel said "I'm disappointed" as he hit out at plans to reduce tax caps and said he "would have liked to have seen their maximum liability, their cap, increase much more".

Deputy Haley Camp said P&R's approach of presenting two budgets showed it had abandoned all spending discipline.

P&R Treasury Lead Charles Parkinson said he never believed the direction to reduce spending by 1% in real terms - which deputies agreed to last year - was possible.

Camp disagreed: "It is clear we're only moving in one trajectory which is let's just keep on spending money with abandon and at some point down the road someone else can fix it."

Deputy Lee Van Katwyk said alongside Deputy Rob Curgenven he would be bringing a proposal to freeze fuel duty to "support struggling families".

Former head of Start Up Guernsey, Deputy Jennifer Strachan questioned P&R's plans to introduce an entrepreneurs' tax cap to attract new business to the island, alongside the States' decision to close the Digital Greenhouse, a centre for digital and creative start-ups.

"I think they're doing an easy thing, which is to say - here's a tax cap, come live here," she said.

"I think the hard work is actually developing the ecosystem for entrepreneurs to thrive."

Deputy Rob Curgenven agreed: "We've got the windfall in for pillar two and obviously GST has been agreed in principle.

"It just feels now that the cap is off and the spending spree is ready for Christmas."

Parkinson warned that simply bringing a budget with the spending cuts would lead to "a flood of amendments".

"We're only suggesting under the Option B budget half of what States committees have requested.

"We're not spending like a drunken sailor."

P&R has presented a budget which includes an inflationary increase in income tax allowances, lower taxes on a pint at the pub, a new £15m fund to encourage economic growth, £6m for initiatives to encourage States savings and the abolition of mortgage interest relief.

Deputy Aidan Matthews, who has fought to defend mortgage interest relief as previous P&R's have looked to remove it, said he would be looking to reverse this move to remove it by 2029.

He said: "I think that really the best thing that we should be doing is encouraging people to be able to afford to buy their own homes."

Alongside the Committee for Housing, P&R said it was working on initiatives to support first-time buyers.

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