Falklands : PUBLIC MEETING REPORT (24/06/08)
Submitted by Falkland Islands News Network (Juanita Brock) 29.06.2008 (Article Archived on 13.07.2008)
A Public Meeting was held in the Court and Council Chamber of the Town Hall on the budget just passed by Legco.
PUBLIC MEETING REPORT (24/06/08)
By J. Brock (FINN)
A public meeting was held in the Court and Council Chamber of the Town Hall at 1700hrs on Tuesday, 24 June 2008. Preset were Cllrs Clausen (Chair), Birmingham, Cockwell, Stevens, Robertson, Summers, Rendell and Hansen. Approximately 35 members of the public attended.
The subject of this meeting was the results of the 2008/09 budget and the Financial Secretary, Mr Derek Howatt, gave a power-point presentation about the process. His presentation included a brief history of past budgets where there was more money for government disposal, an overview of financial pressures on Government and an explanation of why expenditure is increasing. He then went on to show that these processes are constantly under review and that the goal was to increase revenue byn£500,000.00 and decrease expenditure by £500,000.00
Several slides explained how the budget had targets for both revenue and expenditure and how we are going to meet (or not meet) them by 2013. He said that the surplus from each budget was declining and not increasing.
Mr Howatt was asked whether MSL had been figured into the budget and Mr Howatt said it wasn’t because legislation had to be in place before it was added to the budget.
Several members of the public asked why MSL would be implemented before the taxation review took place and Derek Howatt said that something had to be done to meet the deficits. Roger Spink asked whether it was rather a failure to provide options or make necessary decisions and Mr Howatt said that some options were rejected while others would have to await a proper time. Others that were accepted had to be phased into the budget. Cllr Clausen said that the guidelines were received late and there was a very short time to read them before the Legislative Council Meeting
Mr Spink then asked what went wrong with the £1.8Million target to make it a £2.3Million reduction and Cllr Clausen pointed out that the budget was worked on when fuel was at a lower price. Cllr Summers then added that just because some of the options weren’t taken by 29 May that they wouldn’t be considered at a later date before the new financial year.
Mike Forrest asked if savings could be found to offset the Employment Tax and Cllr Summers said no. Then Roger Spink brought up the fact that it would raise £900,000.00 but £2,000.00 for the Dairy, £500,000.00 for the abattoir, £450,000.00 for the Ferry service and the road, and the subsidy for the Wool Company would more than pay for the Employment Tax. These were areas of discretionary expenditure from the surplus.
Cllr Clausen said one had to be careful where they put their money and Mr. Spink asked why it was we were paying for our past errors. None of these ventures would make any money. Dr. Elsby said that FIG took on the expenditure for the abattoir but Cllr Summers reminded him that STABX money came in after FIG expenditure was made and it offset the cost of building it. He also said that the Bank would be prepared to loan people money for the Dairy and Abattoir but others murmured that if it didn’t make money perhaps the bank wouldn’t lend the money. Cllr Clausen said that Government had to sacrifice to help the economy but people surrounding FINN were upset that FOG would help the Dairy and not someone who needed to be sent away medical. Dr Elsby added that the number of sheep going through the Abattoir seemed to be declining but Cllr Summers mentioned that when the Abattoir was first built it was meant to process 90,000 sheep per annum that normally would have been culled and left. However the focus for rural development had changed and people were selling Lambs to the Abattoir and there was also beef.
Cllr Robertson mentioned that making money from the Abattoir was a long-term process and it wasn’t expected for it to make money in the short term. She also mentioned that due to rural development there was an emphasis on Tourism and the days of making money only from wool were over. Cllr Stevens mentioned that discretionary expenditure should be balanced against money spent for healthcare and education. Cllr Summers said that discretionary spending was a national investment on infrastructure. Logic and common sense needed to be used when making expenditure. He pointed out that in the 1990s £14Million was spent on Capital Projects when this year the budget was only £4Million. He concluded that there was not enough surplus to continue discretionary projects at the same level. Cllr Robertson mentioned that expenditure for Health and Education in some areas seemed to be out of control and something had to be done about it. She said we probably could be victims of our own success as people had different expectations and higher standards than before.
Mr Howatt then continued with his presentation by explaining the various funds where Government held money and mentioned that Fund Transfers were at £4.5Million, Aviation was at £2.4Million, Health at £6.8 Million, Education at £5.5Million, Fisheries at £4.5Million,PWD at £8.9 Million, Central Admin at 4.0Million, Agriculture at £1.0Million, Other at £5.2 Million and Transfer Payments at £4.9 Million.
A member of the community asked how much money for Morrison’s projects was taken out of the PWD budget and Derek Howatt said that Morrison’s billed them on a per project basis.
Mr. Howatt continued the presentation with Revenue coming in and showed that Fisheries earned £16.8Million, PWD earned £5.1Million, investment income was £6Million Healthcare earned £1.5Million, Taxation earned £9.5Million, Customs earned £7.3Million and other income amounted to £7.3 Million.
The Capital Programme of £5.1 Million included: £1.2Million for Roads, £1.1Million for buildings and land,£1Million for Municipal Services,£0.7Million for Plant and Vehicles and £1.1 Million for other projects.
Mr Howatt concluded that there was still a long way to go and that future expenditure was not sustainable and that some difficult choices had to be made. People needed to be consulted and the Star Chamber Process with Heads of Department had to be worked through so that the Medium Term Financial Plan could be realised. Lead in time for proposals was needed and there was a lot more to come.
Members of the public brought up the Employment tax again and asked why the tax bands couldn’t be increased to cover this. They did not understand how the Medical Department could benefit if money raised went into the Consolidated Fund. Cllr Robertson explained that there could be line item in the Department budget for the amount as income. Cllr Clausen said that that it should be relative to what people can afford.
The conversation went to MTOs (going overseas for medical treatment) and their increasing use and cost. They are the most uncontrollable part of the budget and it was suggested that means testing would be discriminatory against people who had to empty their savings account in order to be considered for medical assistance. Cllr Robertson added later that people had higher standards and they equalled standards in the UK. However, UK standards seemed to be slipping and we needed to make our own standards. When asked how much it would cost, Cllr Robertson said she hadn’t seen any terms of reference yet.
Mike Forrest asked about the cost of further work at the Abattoir and Derek Howatt said that £595,000.00 was budgeted for the work yet to be done. Cllr Clausen mentioned that the highest priority was EU Certification as well as better cold storage facilities. Councillors needed to see the analysis before the acquisition was finalised. Cllr Summers said that the first phase was compliance and then there needed to be a return on the investment.
Lewis Clifton questioned Councillors about what standards would be used and he questioned again whether means testing would be used for MTOs Cllr Cockwell said that it would be difficult to means test this and Cllr Summers mentioned that a person on £100,000 per annum doesn’t need £100.00 a month for Child allowance.
A member of the public asked who it would be to have the authority to say “no” to a person who needed to go overseas for medical treatment and Cllr Robertson said it wouldn’t be just one Doctor who made the decision and that there needed to be an anonymous way to critique who goes MTO and who doesn’t. Dr Davies said that a local set of standards needed to be developed. Cllr Summers said that until now the Director of Health and Medical Services was given £750,000.00 and told to live within that budget. However that £750,000.00 has grown to £1.2 Million and somebody needs to make a decision but who? Cllr Cockwell said that a layman would have the ability to make such a decision and Cllr Robertson added that perhaps not in that there were 400 million diseases and would we want to consult Councillors over all of them?
Lewis Clifton ended by questioning about the Chief Executive’s mandate to review the workings of Government but that review wouldn’t be started in earnest until the new Economic Advisor arrived in July. Cllr Summers mentioned that the Tax review and macro economics should come together at some stage in a growing economy but the figures won’t be generated until the new Economic Advisor arrived.
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