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Public Accounts Committee reports on the effectiveness of ‘Spend Local’ cards

​Following a detailed review of the Government's 'Spend Local' scheme, the Public Accounts Committee (PAC) has published its findings and recommendations for the future.

The Spend Local scheme was launched by the Government of Jersey in September 2020, as part of its £150m Fiscal Stimulus package. Each Islander was sent a pre-paid card with £100 credit, which could be spent with local businesses.

The Committee's review sought to measure the effectiveness of the Scheme. The Committee concluded that while the restriction to using the cards with local vendors meant that local businesses benefitted financially from the scheme and many Islanders may have used their cards to support sectors heavily affected by COVID-19 (including retail and hospitality), the Government did not target the scheme specifically at these sectors.

The Committee has also made several recommendations on how the scheme could be used to develop future Government policy. It suggests that any future schemes should include data-gathering to monitor their effectiveness and further research could be used to develop future policy decisions. Other key findings and recommendations from the report are listed below.

Key Findings: 

• 91% of Islanders engaged with the Spend Local scheme
• The restriction of expenditure to purchases made physically on-Island ensured that Jersey businesses largely retained their 'mark-up' or profit
• The Spend Local scheme was not specifically targeted to maximise the positive impact on sectors most affected by the economic downturn
• Islanders generally appear to have treated the Spend Local cards as additional spend, leading to a boost for sectors heavily affected by the COVID-19 Pandemic, such as Retail and Hospitality
• The exact effectiveness of the Spend Local scheme is difficult to evaluate due to
• the lack of available data on whether the cards contributed to spending above £100
• the nature of the scheme as a 'standalone' event; and
• the difficulty in modelling a counterfactual 'do nothing scenario'
• Money provided through the Spend Local scheme was likely to have been used by some Islanders to purchase essential goods
• The Spend Local scheme is likely to have been a one-off event, despite consideration being given to a second tranche
• The Spend Local scheme has attracted considerable interest from policymakers in Northern Ireland and Scotland, with the former using Jersey as a model for its equivalent to the Spend Local scheme
  

Key Recommendations:

• Any similar scheme in the future should consider the use of data-gathering mechanisms to improve understanding of Islanders response to and use of the Spend Local cards
• The Government of Jersey should undertake further work to understand the behavioural changes in Islanders using the Spend Local cards to improve development of future high street strategies
• The Government of Jersey should investigate ways to target sectors most affected by the downturn, whilst still supporting household incomes and other businesses
• The Government of Jersey should monitor the use of schemes such as Northern Ireland's High Street £100 Voucher Scheme, to further assess their economic benefits, as a means to consider additional policy innovations to drive the Island's economy and improve the finances of Islanders, particularly those on lower incomes and the hardest-hit industries
  

The Committee, having considered the delivery and implementation of the Spend Local Scheme, concluded that overall, most elements worked well although there was room for improvement should a second scheme be considered. The Committee is pleased to note the positive impact the Scheme appears to have had on Jersey's reputation for innovative policymaking and its impact on other jurisdictions.

Chair of the Public Accounts Committee, Deputy Inna Gardiner, commented: "While we recognise that the Spend Local Card scheme provided a boost to many local businesses following the Stay Home order, we believe the Government can – and should – do more to target any future incentives so they support the sectors most affected by COVID-19.

"We call for the Government to ensure that they use the lessons learned from the Spend Local card to develop future policy propositions to support the hardest-hit industries, and Islanders on low incomes."