Fiscal Policy Panel – Re-appointment of Member

STATES OF JERSEY

FISCAL POLICY PANEL – RE-APPOINTMENT OF MEMBER

Presented to the States on 21st February 2024 by the Minister for Treasury and Resources

STATES GREFFE

2024  R.28

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REPORT

Introduction

Article 43 of the Public Finances (Jersey) Law 2019 provides for the Minister for Treasury and Resources to appoint (and re-appoint) members of the FPP.

The Minister is required by Article 43(6) to, at least two weeks before appointing a member of the Panel, present to the States a notice of his or her intention to make the appointment. In accordance with Article 43(5) the views of the Jersey Appointments Commission have been sought.  

Recommendation

To approve the appointment.

Detail

The legal framework for the Fiscal Policy Panel (FPP) is set out in the Public Finances (Jersey) Law 2019, which requires the Panel to publish an annual report commenting on:

• the strength of the economy in Jersey;

• the outlook for the economy in Jersey and for world economies and financial markets;

• the economic cycle in Jersey;

• the medium and long-term sustainability of the States' finances;

• transfers to or from, the Strategic Reserve Fund and Stabilisation Fund;

• the States' net assets and liabilities.

The FPP are responsible for monitoring the application of the fiscal guidelines. The guidelines set out in the Government Plan are to:

• Seek to increase the Strategic Reserve and public sector net worth, while following the advice of the Fiscal Policy Panel on borrowing and net financial assets

• Run a primary structural current balance or surplus until the Strategic Reserve is judged large enough to meet its mandate

• Borrow only to finance investment (or refinance liabilities), except in times of economic duress, and monitor the impact on net financial assets.

The Panel is also responsible for producing independent economic forecasts that are used to inform income forecasts.

Existing Fiscal Policy Panel members

Dame Kate Barker joined the FPP in March 2014 and her current term as Chair ends in May 2024. Recruitment is under way for her successor.

Professor Francis Breedon joined the FPP in March 2016 and his second term as Member ends on 22 March 2024.

Professor Richard Davies joined the FPP in April 2018 and his second term as Member ends in May 2027.

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Expansion of the FPP role

The role of the FPP is being expanded to take on responsibility for providing independent advice on financial stability. In November 2023, the Chief Minister decided to transfer the functions of the Shadow Financial Stability Board to the Fiscal Policy Panel[1]. Work is currently underway to action this decision, which will involve drafting secondary legislation during 2024 to amend the Public Finances (Jersey) Law 2019 and it is currently anticipated this will be brought to the States Assembly for consideration early in 2025. The FPP will assume shadow responsibility for advising on financial stability during 2024.

The Minister reviewed the resourcing of the FPP in November 2023[2]. The commitment and remuneration for the FPP Chair and Members had not changed for over 10 years. In order to fulfil this important expanded role, the annual commitment and remuneration of the panel have been updated and an additional Member will be recruited during 2024 to share the workload. These changes to resourcing will all be met within current budget.

Re-appointment of Professor Francis Breedon

Professor Francis Breedon's current term will end on 22nd March 2024. After discussion with the Jersey Appointments Commission, the Minister intends to renew this appointment for one further year for continuity on the panel, as the new Chair and new Member settle in and the FPP prepares for and takes on the new financial stability role.

Remuneration

This will be £24,000 per annum for the reappointment, in accordance with the decision of the Minister in November 2023.

Minister for Treasury and Resources