States Meeting Transcript - 12/05/2010

STATES OF JERSEY OFFICIAL REPORT WEDNESDAY, 12th MAY 2010

PUBLIC BUSINESS - RESUMPTION...........................................................4

1. States Net Revenue Expenditure 2011 and 2012: Reduction (P.29/2010) ...............4

1.1 Deputy F.J. Hill of St. Martin : ...........................................................4

1. Senator A. Breckon: .....................................................................4
2. Senator J.L. Perchard:....................................................................6

2. Draft Judgments (Reciprocal Enforcement) (Amendment No. 3) (Jersey) Act 201- (P.32/2010)................................................................................9

2.1 Deputy J.A.N. Le Fondré of St. Lawrence (Assistant to the Chief Minister- rapporteur): .........................................................................................10

3. Draft Advocates and Solicitors (Amendment No. 5) (Jersey) Law 201- (P.34/2010)..10

3.1 Deputy J.A.N. Le Fondré:..............................................................10

1. The Deputy of St. Martin:..............................................................10
2. Deputy J.A.N. Le Fondré:..............................................................11

4. Draft Public Finances (Transitional Provisions) (No. 2) (Amendment) (Jersey) Regulations 201- (P.35/2010)............................................................11

4.1 Senator P.F.C. Ozouf (The Minister for Treasury and Resources):......................12

1. Deputy P.V.F. Le Claire of St. Helier : ..................................................12
2. The Deputy of St. John:................................................................13
3. Senator P.F.C. Ozouf :..................................................................13
4. Senator S.C. Ferguson:.................................................................14
5. Deputy G.P. Southern of St. Helier:....................................................14
6. Deputy T.A. Vallois of St. Saviour:....................................................14
7. Senator J.L. Perchard:..................................................................14

8. Deputy R.G. Le Hérissier of St. Saviour:...............................................15
9. Deputy I.J. Gorst of St. Clement (The Minister for Social Security):....................15
10. The Connétable of Grouville :........................................................15
11. Senator P.F.C. Ozouf : ...............................................................16
12. The Deputy of St. John:..............................................................17
13. Senator P.F.C. Ozouf : ...............................................................17
14. Deputy P.V.F. Le Claire:............................................................19
15. Senator P.F.C. Ozouf : ...............................................................20

5. Draft Health Insurance (Medical Benefit) (Amendment No. 3) (Jersey) Regulations 201- (P.36/2010)..........................................................................21

5.1 Deputy I.J. Gorst : ......................................................................21

1. Deputy P.V.F. Le Claire: ...............................................................23
2. Senator S.C. Ferguson:.................................................................24
3. Deputy R.G. Le Hérissier: ..............................................................24

4. Deputy I.J. Gorst : ......................................................................25
5. Deputy R.G. Le Hérissier: ..............................................................25
6. Deputy J.A. Hilton of St. Helier:........................................................25
7. Deputy A.E. Pryke of Trinity :..........................................................26
8. Deputy T.M. Pitman of St. Helier:......................................................28
9. Senator P.F. Routier: ...................................................................28
10. Senator B.I. Le Marquand:..........................................................29
11. Senator P.F.C. Ozouf : ...............................................................29
12. Deputy G.P. Southern : ..............................................................31
13. Deputy M.R. Higgins of St. Helier:..................................................32
14. Deputy A.E. Jeune of St. Brelade:...................................................32
15. Deputy J.M. Maçon of St. Saviour : ..................................................33
16. Connétable J. Gallichan of St. Mary:................................................33
17. Senator T.A. Le Sueur:..............................................................34
18. Deputy M. Tadier :...................................................................34
19. Deputy I.J. Gorst :....................................................................35 Deputy R.G. Le Hérissier:....................................................................41 Deputy I.J. Gorst : ............................................................................41

6. Terrorist Asset-Freezing (Temporary Provisions) Act 2010: extension of Sections 1 and 3 to Jersey (P.38/2010) ..............................................................42

6.1 Senator T.A. Le Sueur (The Chief Minister):...........................................42

1. The Deputy of St. John:................................................................43
2. Deputy J.A. Martin of St. Helier:.......................................................43
3. Deputy M. Tadier :......................................................................43
4. The Connétable of Grouville :...........................................................43
5. Connétable D.W. Mezbourian of St. Lawrence:........................................43
6. Mr. T.J. Le Cocq QC., H.M. Attorney General: ........................................44
7. Senator T.A. Le Sueur:.................................................................44

LUNCHEON ADJOURNMENT PROPOSED..................................................45 LUNCHEON ADJOURNMENT................................................................45

PUBLIC BUSINESS - RESUMPTION..........................................................45

7. Reciprocal Health Agreement with the United Kingdom: negotiations (P.39/2010)..45

7.1 Senator A. Breckon: ....................................................................46

1. The Deputy of Trinity :..................................................................48
2. Deputy K.C. Lewis of St. Saviour:......................................................49
3. The Deputy of St. John:................................................................50
4. Senator T.A. Le Sueur:.................................................................50
5. Deputy A.E. Jeune :.....................................................................50
6. The Very Reverend R.F. Key, B.A., The Dean of Jersey:...............................50
7. Senator A. Breckon: ....................................................................51

8. Millennium Town Park: commencement in 2010 (P.42/2010)..........................52

8.1 Connétable A.S. Crowcroft of St. Helier:...............................................53

9. Millennium Town Park: commencement in 2010 (P.42/2010) - amendment (P.42/2010 Amd.)....................................................................................56

9.1 Senator T.A. Le Sueur:.................................................................56

1. Deputy D.J.A. Wimberley of St. Mary:.................................................57

2. Senator T.A. Le Sueur:.................................................................58
3. The Connètable of St. Helier:...........................................................61
4. Deputy P.V.F. Le Claire: ...............................................................64
5. Deputy A.K.F. Green of St. Helier:.....................................................65
6. Deputy D.J. De Sousa of St. Helier:....................................................66
7. The Deputy of St. John:................................................................67
8. The Deputy of St. Mary:................................................................68
9. Deputy S.Pitman:......................................................................72
10. Deputy T.M.Pitman:................................................................73
11. Deputy R.C. Duhamel of St. Saviour:................................................74
12. The Deputy of St. Mary:.............................................................78
13. Deputy R.C. Duhamel:..............................................................78
14. Deputy A.K.F. Green:...............................................................79
15. The Connétable of St. Ouen : ........................................................79
16. Connétable J.L.S. Gallichan of Trinity : ..............................................79
17. The Connétable of St. Mary : ........................................................80

ADJOURNMENT................................................................................81

The Roll was called and the Dean led the Assembly in Prayer.

[9:37]

PUBLIC BUSINESS - RESUMPTION

1. States Net Revenue Expenditure 2011 and 2012: Reduction (P.29/2010)

The Bailiff :

Very well then. We return to the debate on Projet 29 - States Net Revenue Expenditure 2011/2012: reduction. Does any other Member wish to speak? Deputy of St. Martin .

1.1 Deputy F.J. Hill of St. Martin :

I was hoping to get in early, because I think proverbially one would make yesterday's episode where Senator Shenton was very much on the ropes and I think really was hoping that someone would throw in the towel, and I was hoping maybe that Senator Shenton may have taken note of what was said yesterday and we would not spend too much time really getting to debate this particular project, which I think is well-intentioned, but I do not think it will be very successful. But at the same time, I think it has echoed something which is very important, that if we are going to look at our expenditure, it does require discipline. Senator Shenton says on page 5 of his report that in 2008 States Members did not question expenditure levels and believed them to be realistic. If the Minister for Treasurer and Resources is serious about working to a 3-year financial target, this is an opportunity to commit to it an early stage. While I can speak for myself, I know I opposed what was going on, particularly when we had this £12 million handout, almost like I suppose the Chief Minister's parting shot, where we have the Prime Minister giving out medals and knighthoods et cetera with his parting shot. So I think what we have got to do is certainly support what the Minister for Treasury and Resources is going to bring forward, and all the Ministers I know gave an opportunity for the Minister for Education, Sport and Culture yesterday to give vent to his displeasure, but really, if we are going to have cuts, we have got to make them right across the board and stick to it, so what I would ask maybe is that Senator Shenton could take note, I think, of a very good debate. I do not think he is going to be successful, but at least he has fired a warning shot, and I would ask maybe Senator Shenton might consider maybe bringing this debate to an end. Thank you, Sir.

1. Senator A. Breckon:

I should declare an interest in that I am a member of the P.A.C. (Public Accounts Committee). Having said that, I am not an accountant, and information has been presented in a form that I could understand, so therefore I would say that most other people would be able to understand it, because sometimes, with respect - I know there are some in here - accountants have a way of expressing things where perhaps very few people can understand them and maybe that is why they are highly paid. But the other thing I would say, Sir, is that the Public Accounts Committee benefit from having some lay members and that is a tremendous asset because they are able to give some extra depth, vision and view of how we do things and perhaps give us something when sometimes we are in these silos we do not see and appreciate. One of the views that has been expressed is sometimes we set the bar at a very low level and then we are not able to get over it, and we are setting sometimes low standards and not achieving them, and that has come by figures that I have seen that have said when we do set public expenditure, we do not stick to it. If we have gone 2 and 3 years on, then we have gone £30 million, £40 million, £50 million over what was predicted. The other thing, Sir, that has perhaps been the illusion that has happened in the past is the Treasury have underestimated the yield from taxes and other things, so there has always been a view: "Well, it does not matter, because somebody is going to pull a rabbit out of the hat that will fill this little deficit" or: "The bad news will not be quite as bad" and those are really the parameters, I think, that we have worked within. I did need some persuading, I should tell Members, to agree to this, and

we did have - I think the Chairman will agree and the other Members - some robust discussion with this, but for me, Sir, it is also linked to other things. It is not about just how we spend money, but just touching on that, what is nice to do and what is it that we must do? There is a difference. I mean, with respect, should we be paying people to be counting squirrels and frogs and other things like that? Something I came across last year, and I had to see it to believe it - and this is something I know that goes to the heart of something Deputy Le Claire mentioned - I found somebody last year who was going around telling people to put cigarettes out, and we are paying somebody to do that. They are not a fag-putter-outer or whatever they are, they have a title of Smoking Cessation Officer or something like that. But there again, if I was sitting somewhere and somebody lit-up, I would say: "Excuse me, mate, can you put that fag out?" So I would not necessarily say we need to have somebody to do that. Of course, there is the force of law behind that. We have regulations with which to hit restaurateurs or whoever it may be to do that, but we also have Regulation of Undertakings, and I am not sure where we are with monitoring or policing that. We have a Housing Law; I am not sure where we are with policing that. So are we heavy-handed in some areas, and light in others? So when I looked at some of this, I am thinking: "Well, maybe, just maybe if we look harder we can save some money in some areas without hitting elderly services and child-rearing and doing some of the things like that" but the other thing is as well some of these things are commonsense, about not eating too much, not drinking too much, not smoking too much. Should people not be doing it anyway? Do we need an army of people or whatever it is to tell people that? The other thing, Sir, on the raising money, because the 2 go together, and I think it was 1994, I first suggested capping mortgage relief, and what I was told then by the Comptroller of Income Tax, the Treasurer, the Economic Adviser, if that happened the economy would collapse, if we interfered with that to stop people, and somebody told me - a former Member of this House - that they had 5 mortgages that was part of their investment strategy portfolio or whatever else it is, and I said: "Well, it should be on the principal place." Of course, now we have done it, and the reason I say that, and the Deputy of St. Martin will remember on the other side of this he suggested the equivalent of stamp duty on share transfer of property, probably about 7 or 8 years ago. We have finally got there. So if we talk about cutting spending, we also, I do not think, have looked actively at how we raise revenue. Another example, Sir, Vehicle Registration Duty disappeared in the middle of 2008 with the introduction of G.S.T. (Goods and Services Tax) but approximately £4 million a year had been raised on Vehicle Registration Duty which went. A couple of times I have asked: "How much do we raise in G.S.T.?" Nobody can tell me, so on one side, we are saying: "Cut the spending" but on the other side: "Where is the income?" and we have had income

streams that we could have had that we have not done. [9:45]

We have not done that, so if we are squealing: "Times are hard" then perhaps those raising the revenue should have been a bit sharper with their act to do that. Recently I had an amendment to the budget about stamp duty. The House rejected that on the back of one letter from a legal firm that went to the Chief Minister, so if we are going to have some unfortunate or unpleasant decisions to make, then perhaps we have to treat some of these with the vested interest that they are, and it is unfortunate for them, but there are also things that are going to be unfortunate for other people as well. Also, Sir, to balance the budget, in the last budget, the Minister for Treasury and Resources had the opportunity to get some money from impôts, and chose not to. He went all or nothing on the impôts and he got nothing. I would suggest he could have had £2 million or £3 million with an amendment that would have brought some money in and it would have affected this proposition which is about cutting budgets, because we could have had some supply side money, and again I am looking now at the Minister for Social Security because there is an opportunity with hypothecated money. People will contribute towards elderly care, and again this looks to me as if it is years away. This sort of thing should be fast-tracked, so while we are looking at some bad news we also, I believe, need to factor some good news in. Also, Sir, on the other side, we talked about non-domiciled companies making a contribution. I still have not seen it and it is drifting out. If you look in the high street, there are companies who are doing that who are willing to make some contribution. It is not happening, so I would suggest those responsible need to sharpen their act, because it is all right bearing down and saying: "We need to cut this and do that" but then others who should be making a contribution should be doing exactly that, and somebody should have been on their case before now. It is not good enough to say in 2 or 4 years' time. If there is some gain and there is some pain then perhaps some of this should be shared around. That, Sir, was the reason, because the difficulty we have got with cutting spending, increasing taxes, looking at charges, it cannot be taken in isolation, and some of the discussions we had encompass some of this, which does stretch the boundaries of the Public Accounts Committee, but there again, if you are going to have the discussion then we need to have that, and I do not think, Sir, that this House has had it. It is a shame that this is coming late, it is coming in bits and pieces, and I am not sure how we are going to handle it, because we need to encompass more than we have today and we need to do it fairly soon and embrace things, perhaps like elderly care, increases in social security, looking at issues there, and it is not good enough to take it apart, apart and say it will work because it will not. It needs to be embraced, and I am not sure that we have all signed-up to do that, and I am not sure either, Sir, that we have got the information. Now, what this is from the P.A.C., I believe it is a warning shot that says: "Well, this is a possibility." It may be do-able. It will be painful, but maybe, following this debate, those with some of the responsibilities in areas that I have touched on will do what they should be doing and address some of the issues so that it can come together as a whole policy, and that is where it is for me, Sir. With that, as I say, my support was qualified, because we had the discussions in the P.A.C. over a series of months and that is why this got my support, and I believe it is important to share that with Members, because however this goes today, whether it goes any further or whether it is withdrawn, Members need to take notice of where we are, and I do not see the rabbits coming out of the hat. It is a very difficult situation we have got. It is not about Ministers, Assistant Ministers, anybody else; it is a whole House and a

whole Island issue, and that is how we have to approach it. Thank you, Sir.

The Bailiff : Senator Perchard.

2. Senator J.L. Perchard:

I am disappointed, but not really surprised by the written response of the Council of Ministers, and the response of Members during this debate. I am surprised particularly by the Deputy of St. Ouen , who ironically in the last House, when he was Vice-Chairman of P.A.C., I remember demanding spending cuts and efficiencies from the then Minister for Treasury and Resources, Senator Le Sueur . Those Members that were here then will remember that he used to demand these cuts with the same vigour and passion and volume that he displayed yesterday when arguing to protect his own department budget. That said, Sir, it would not be entirely accurate to describe the Deputy as a poacher turned gamekeeper. I think a more appropriate description for the Deputy 's U-turn over public spending would be gamekeeper turned poacher. For the record and for the benefit of Deputy Le Claire, I want to remind Members that the Public Accounts Committee lodged this proposition to trim 10 per cent from the net annual public spending over a 2-year period on 15th March. That was before the Minister for Treasury and Resources outlined his plans publicly to trim 10 per cent over a 3-year period. I am confused that if the Council of Ministers think that they can achieve 10 per cent savings, the same 10 per cent savings that the P.A.C. propose over a 3-year period rather than the suggested 2-year period, that they should list on pages 3 and 4 of their comments the consequences of making these cuts. I say I am confused, because without doubt, the same consequences will apply in both the 2 and 3-year scenarios. As the listed consequences are obviously distasteful and disagreeable to the Council of Ministers, it appears to me, sadly, that they have no real appetite to deliver these savings. I will go as far as predicting that these reductions in expenditure will not be delivered at all, and that the structural deficit will eventually have to be filled by extra taxes or raiding the Strategic Reserve in the longer term. If I am wrong, if I am proved wrong, if delivered, the Council of Ministers' 3-year proposal to balance the books could, on the face of it, meet the requirements, but will, during the 3-year period, use up all the savings in the Stabilisation Fund and a lot more from increased taxation or possibly a strategic reserve, if the current economic downturn continues. The concept to me, Sir, of dipping into the Strategic Reserve is something that simply may be unavoidable if the Island wishes to maintain a competitive tax environment. Alternatively, we could borrow from the banks or the markets to cover shortfalls, but I say to Members be under no illusion here. The structural issues that led to the Greek collapse are the very same type of structural issues that currently exist in Jersey. Like Greece, when our reserves run out and have been spent as a result of our failure to address the structural deficit, we will be in serious trouble. What will Jersey then do? I believe we need to be bold and we need to take those difficult decisions as early as possible. The focus on trying to diversify our revenue by reducing expenditure, growing the economy and undoubtedly tax increases could be seen as strategically sound. However, the concept of assuming that the economic stimulus will grow or protect the economy, therefore addressing the deficit by generating an increase in the tax base is a very dangerous game of luck. This strategy can only work if public spending is reduced, thereby allowing the increased tax base to cover the gap. In Jersey, the tax base is not keeping up with our ever-increasing demands of the public sector. I say to Members, and which I am sure we will all agree, luck is not a strategy we should adopt. The issue of so-called savings that are not savings is another point I would like to make. The assistant to the Chief Executive, with responsibility to identify savings at a recent Public Accounts Committee hearing, did make the case of the amount of savings that had already been made. Terrific, wonderful, on the face of it, but why then if we are making these savings does States spending continue to rise? I say again if we are making these millions and millions of pounds of savings, why does States expenditure continue increasing over and above the rate of inflation? It is clear, Sir, that the smoke and mirrors of States savings are just an illusion and that these savings are in fact spent several times over. This is simply not good enough and not a good sign for the current comprehensive spending review. Will we identify savings there, only for them to be spent elsewhere? Moving on to the timing of cuts, which seems to be the main concern for the Council of Ministers, and despite all the reports and predictions of budget deficits going back many years, the many, many reports and predictions from the Comptroller and Auditor General, the Council of Ministers' own work, going back over many years, despite that there has been little done to manage the overall level of States spending, which has significantly - as we all know - increased since the millennium. For the Council of Ministers

now to say that the timeframe for delivery of cuts is too short and will lead to cuts in services rather than a properly planned savings is hard to understand and to accept. From another perspective, surely the more prudent and safe way to ensure genuine savings are made is to start now and not wait until the heavyweight structural deficit of in the region of £80 million per annum arrives in 2011. An early move to address the massive shortfalls will have a compound benefit, particularly if there is any form of economic recovery in the meantime. I was fascinated yesterday when Deputy Southern suggested to the Assembly that there should be no cuts before the boom phase of the economic cycle returns. Well, I say to the Deputy and to Members, a full economic recovery is not assured; far from it. In fact, a real economic recovery is unlikely to happen unless the Island is competitive, prudent and well-governed. These are the 3 ingredients that are essential if investors and businesses have the confidence to come and to stay in Jersey. As a result of the Comptroller and Auditor General's work, we have a good picture of the state of the financial controls and management of States departments. This House is accountable to the public, but it is the individual department who controls spending. Unfortunately, the Finance Law is imperfect in its definition and accountability and Ministers still allow spending to continue while this lack of accountability, and moreover, responsibility persists. Frankly, any private sector business would be shut down immediately in this scenario. The problem is that no one in government really genuinely - no one individual - takes responsibility for public spending. That said, I do applaud the efforts of the Minister for Treasury and Resources, who seems to be paddling against a tide of what seems to be unaccountable colleagues and their senior management. Members should challenge the list provided on page 3 and 4 in the comments of the Council of Ministers, who of course assure us that they are not shroud-waving. Have the Council of Ministers not read any of the reports on suggested efficiencies? I refer to the excellent Emerging Issues Report from the Comptroller and Auditor General and the more recent States Spending Review Report from the Public Accounts Committee, where significant savings have been identified, savings which would make serious inroads into cutting spending without sacrificing front line services.

[10:00]

This is why, Sir, when I read the Council of Ministers' response to the Public Accounts Committee proposition I believe they are not really serious about making the necessary savings. I believe the Jersey taxpayer is being set up for more tax increases and that spending is being allowed to remain out of control by Ministers who are privately preoccupied in protecting their own departmental budgets. Strategically, this is a high risk, if not a crazy strategy. Remember the public sector is not able to create and generate sustainable growth. The public sector is a hungry horse and it needs feeding. With regard to tax increases, I urge Members to remember that the Island's wealth generators and employment creators are, in most cases, highly mobile businesses, most of whom are now becoming aware that the States focus and determination to put our house in order is not as robust as it might be. The businesses will, before long, be considering the options they have to migrate to a jurisdiction with a lower tax base. Jersey, if it wants to maintain its financial services and fulfilment industries, must retain its low tax reputation and status and we, the States of Jersey, must send out the message loud and clear that we are capable of doing just that at the same time as balancing our books. This proposal will involve tough and difficult decisions. It appears at this time there is little appetite among Members to take up this challenge but I, for one, believe it could be delivered and, more importantly, should be delivered. The Chairman and States Members of the Public Accounts Committee agree that there is little chance of this proposition being successful as the States simply do not appear to have the appetite for this level of reform. The Chairman, Deputy Breckon and I have agreed to withdraw the proposition and request that Members permit the Public Accounts Committee so to do.

The Bailiff :

Do Members agree that the Public Accounts Committee be given leave to withdraw the proposition?

Deputy M. Tadier of St. Brelade :

I would still like to speak and I think my colleague alongside me wanted to speak.

The Bailiff :

No, I was merely giving them leave to withdraw. You ask for the appel, then, in relation to whether they should be given leave to withdraw?

The Bailiff :

[Aside]  Very well, then. The matter before the Assembly is whether the Public Accounts Committee should be given leave to withdraw the proposition, Projet 29. If you wish to give them leave to withdraw, you vote pour.

Deputy P.J. Rondel of St. John : Can we speak on it, Sir?

The Bailiff :

No. The debate is closed. This is simply to give them leave to withdraw.

The Deputy of St. John :

Because I was hoping to hear the Minister for Home Affairs and had a 5-page epistle I wanted to give you. [Laughter]

The Bailiff :

Then you will vote contre. If you wish the debate to continue, you vote contre. If you wish it to end, you vote pour. It is as simple as that.

Deputy M. Tadier :

Can I make a very short comment?

The Bailiff :

No, Deputy , [Laughter] [Aside] you may not. Now, this is a vote on simply whether to give them leave to withdraw so the Greffier will now open the voting on that proposition.

The Bailiff :

Very well. So that matter is withdrawn.

2. Draft  Judgments  (Reciprocal  Enforcement)  (Amendment  No.  3)  (Jersey)  Act  201- (P.32/2010)

The Bailiff :

The next item on the Order Paper is the Draft Judgments (Reciprocal Enforcement) (Amendment No. 3) (Jersey) Act 201- - Projet 32 - lodged by the Chief Minister and I ask the Greffier to read the Act.

The Deputy Greffier of the States:

Draft Judgments (Reciprocal Enforcement) (Amendment No. 3) (Jersey) Act. The States, in pursuance of Article 3 of the Judgments (Reciprocal Enforcement) (Jersey) Law 1960, have made the following Act.

Senator T.A. Le Sueur (The Chief Minister):

My Assistant Minister, Deputy Le Fondré, will act as rapporteur for this item and the next item.

2.1 Deputy J.A.N. Le Fondré of St. Lawrence (Assistant to the Chief Minister- rapporteur): It is a very simple amendment that we are looking at in relation to the 1960 Judgments (Reciprocal Enforcement) Law. Basically what it does is update the schedule in 2 ways. It makes provision for the Supreme Court in the United Kingdom to be included in the schedule and it renames the Northern Ireland Court, which has a very similar name, to avoid confusion between those names. If that is simple enough, I will move the principles.

The Bailiff :

The Act is proposed. Is that seconded? [Seconded] Does any Member wish to speak on the Act? Very well, all those in favour of adopting the Act, kindly show? Those against? The Act is adopted.

3. Draft Advocates and Solicitors (Amendment No. 5) (Jersey) Law 201- (P.34/2010)

The Bailiff :

The next matter is the Draft Advocates and Solicitors (Amendment No. 5) (Jersey) Law201- - Projet 34 - lodged by the Chief Minister and I will ask the Greffier to read the citation.

The Deputy Greffier of the States:

Draft Advocates and Solicitors (Amendment No. 5) (Jersey) Law 201-. A Law to amend further the Advocates and Solicitors (Jersey) Law 1997. The States, subject to the sanction of Her Most Excellent Majesty in Council, have adopted the following Law.

3.1 Deputy J.A.N. Le Fondré:

This brings 3 separate changes to the Advocates and Solicitors (Jersey) Law, firstly in relation to nationality and citizenship requirements, but there is still a proviso or a requirement that the Royal Court is satisfied that the person seeking admission to the Bar is a fit and proper person to be admitted. Secondly, in relation to the qualifying period of employment, and the qualifying period is 2 years, but basically if someone works outside the Island for more than 6 months on matters primarily relating to Jersey law, this is capped as a period of 6 months which can count as part of those 2 years. Previously the wording in that part of the law meant if someone worked away for more than 6 months, they lost all of the time, which was a bit erroneous. So if you worked for 5 months away, you could have 5 months. If you worked for 7 months away, you could have nothing. Finally, the third change is to introduce much more flexibility as to when exams can be held in Jersey and I move the principles.

The Bailiff :

Are the principles seconded?  [Seconded] Does any Member wish to speak on the principles?

1. The Deputy of St. Martin :

It looks quite a simple proposition and certainly it requires all the support it can muster today because, clearly, this should have come years ago. As Members know, I do have concerns about human rights and here we have somebody who was denied the right to work in Jersey simply because they were not a British national and we have changed our law to allow people to vote after 2 years. I hope we will bring that down to equate with what we are having here today so I think the Chief Minister's Department is to be complimented on bringing this matter forward. It will make life a lot easier for a lot of people and should have come years ago but let us be happy it is here and I commend this to Members.

The Bailiff :

Does any other Member wish to speak on the principles? Very well. Do you wish to reply, Deputy ?

2. Deputy J.A.N. Le Fondré:

I just thank the Deputy for his comments. I would note it is not just about British citizenship. The issue is a lot wider than that because it was already applicable to either Commonwealth citizenship or European citizenship but did not apply if there was an anomaly. Basically Switzerland, as an example, fell out of the very wide net that already existed. Other than that, I make the comments and I move the principles.

The Bailiff :

All those in favour of adopting the principles, kindly show? Those against? The principles are adopted. Senator Ferguson, is this is a matter you wish to have referred to your Scrutiny Panel?

Senator S.C. Ferguson: No, thank you.

The Bailiff :

Very well, then. Do you wish to propose the Articles en bloc?

Deputy J.A.N. Le Fondré: Yes, Sir.

The Bailiff :

Are they seconded?  [Seconded] Does any Member wish to speak on any of the individual Articles? All those in favour of adopting Articles 1 to 7, then, kindly show? Those against? The Articles are adopted. Do you propose the Bill in Third Reading?

Deputy J.A.N. Le Fondré: Yes, Sir.

The Bailiff :

Is that seconded? [Seconded] Does any Member wish to speak in Third Reading? All those in favour of adopting the Bill in Third Reading, kindly show? Those against? The Bill is adopted in Third Reading.

4. Draft Public Finances (Transitional Provisions) (No. 2) (Amendment) (Jersey) Regulations 201- (P.35/2010)

The Bailiff :

The next matter is the Draft Public Finances (Transitional Provisions) (No. 2) (Amendment) (Jersey) Regulations 201- - Projet 35 - lodged by the Minister for Treasury and Resources. I will ask the Greffier to read the citation.

The Deputy Greffier of the States:

Draft Public Finances (Transitional Provisions) (No. 2) (Amendment) (Jersey) Regulations 201-. The States, in pursuance of Article 6(2) of the Public Finances (Jersey) Law 2005, have made the following Regulations.

4.1 Senator P.F.C. Ozouf (The Minister for Treasury and Resources):

One of the very important responsibilities that the Treasury has is managing the significant investments of the States of Jersey, not only those of directly the States of Jersey but also the oversight of the Social Security Funds, the Health Insurance Fund and a number of other special funds that have been bequeathed to the Island, for example, the Greville Bathe Fund, which is a fund run by Jurats for which the income is discharged for the needy and poor of the Island on an annual basis. The purpose of this amendment, which is quite simple but very important, is to give the ability to effectively create a States Unit Trust, which will allow for the pooling of all of these funds into one fund, effectively setting up a States Unit Trust. The common investment funds, which will be brought into effect by these Regulations, will be a simple arrangement enabling all of the different types of funds and the individual funds to maximise investment returns while co- ordinating and managing risk. While no decisions are being made today in relation to which funds will go into the common investment fund, it is likely that we will be looking at combining the Strategic Reserve Fund, worth approximately £550 million; the Stabilisation Fund to the extent that there is a balance on the fund; the Social Security Reserve Fund, £700 million; Health Insurance Fund, £70 million; and a range of other funds which amount to tens of millions of pounds. It is important that these other funds can benefit from the investment advice that the larger funds do. Some of the smaller individual funds will benefit from the common investment fund by having cost savings and the potential, we hope, for improved rates of return on their investments through the economies of scale of having the investment advisers that are used for the larger funds used for the smaller funds too. This will also improve risk management as a result of being able to access a diversified range of investments for the individual funds. Individual funds will be able to retain their ability to separately determine their own strategic asset allocation and risk profile through their individual unit components. Management and monitoring of the fund and all investments will, as a result of this, be simplified, making administration more effective. I move the principles.

The Bailiff :

Are the principles seconded? [Seconded]

1. Deputy P.V.F. Le Claire of St. Helier :

Yes, I will second the principles and rise just to speak briefly, if I could. Recently I have been drawing up a proposition that I would like to bring to the Assembly in the future. Uncharacteristically on this occasion, I am talking to the Ministers that I am bringing it for. The Minister for Treasury and Resources in particular and the Chief Minister have been quite helpful. That is to do with the way that we invest funds and I am asking the States in the future to look possibly if we can at adopting the United Nations principles of responsible investment. When you get large bodies of money such as this under investment, inevitably what most fund managers that are worth their salt will do is they will take a portion of it and spread it across the stock market to attract the stock market and inevitably that will mean that we are investing in all companies. That sounded like "oil companies" and we probably are but I meant to say all companies. I think my experience on the Public Employment Contributory Retirement Schemes Committee of Management made me a little concerned as to ways in which some funds under management are invested. I appreciate that that fund is a de facto trustee managed fund where you have to get the most for your money but I was particularly disappointed, having been appointed as the Member responsible for ill health retirement on the scheme for political oversight, that we were retiring people from States employment that had serious ill health that was the result of cancers in some instances, probably from smoking. We had a policy in Jersey that recognised the harm smoking was doing and yet, at the same time, we were investing in tobacco companies in India and places

like that. I just think that it is time I came into politics asking for us to have a greater look at ethical investments and I just think that really now we need to take a long hard look at the way we make money and where we make money. If we have to be involved in these companies and inevitably some holding companies may have other companies that are further down the line, if we have to be involved in those, an active management can under-weight the involvement in those unless they do listen to our concerns. I would plead with the Minister for Treasury and Resources to touch upon this if he could in his response because I think it is important that we, as guardians of the public's welfare, not only have cognisance of their financial interests but also of the ethical and moral interests that we as a jurisdiction place our investments in and I would ask the Minister for Treasury and Resources to speak to that.

[10:15]

2. The Deputy of St. John :

Yes, I have one or 2 concerns. All eggs in one basket. That is a concern. I am sorry, I have been involved in finance, believe it or not, through my trusts and the like for many, many years and I do have concerns. We are talking about managing risk, cost saving  et cetera, more effective administration. Yes, fine, I agree with all of that but just think what has happened over the last 2 or 3 years in other countries. We have seen where other local governments in the U.K. (United Kingdom) had money put in places like Iceland and lost it, likewise with Guernsey. We do not want all our eggs in one basket. I accept we are not going to. We have got through one credit crunch without too much of a problem as far as losing anything but let us not think that we are through it all yet. Is it the right time to be moving our sums and taking advice, shall we say, from one adviser or one group of advisers instead of I am sorry, I am speaking, would you stop interrupting or you, through the Chair, Sir, thank you. [Laughter] If these people want me to give way, they should ask through the Chair.

Senator P.F.C. Ozouf : Would the Deputy give way?

The Deputy of St. John :

No, I will not. [Laughter] No, thank you. I am on my feet and I am not giving way. [Aside] So I have real concerns that we are going down the road. We have got through this part of the credit crunch to date. I would not say we are not due for the double-dip that advisers have been telling me about for the last 18 months, 2 years, given, alright, we know that the European market appears to have resolved itself for the moment. We do not know that that is not going to spread on around the world which will come back and bite the United Kingdom of which we are a part of the British Isles and we have some more problems. So do not tinker with what we have got in place which is working well at the moment. I am not saying it should not happen at some time in the future and I know most of you think otherwise because I can see the Treasurer smiling to his colleague at the back of the Chamber, from Social Security I presume [Laughter] [Aside] but, of course, my eyes are in the top of my head and not at the back. But, no, I cannot agree with this because, at this time, I think it is a bad time to be moving our assets around and undertaking advice from one group of advisers. Cost savings, sometimes penny wise pound foolish, and you will not convince me that this is the right time to be doing this. I think it is a time to sit on what we are doing. What we have got is well proven and it works. Let us not move things around at this time.

3. Senator P.F.C. Ozouf :

May I make a point of clarification? I fully understand the Deputy 's point. I am afraid that, with the greatest of respect, he has misunderstood what the proposal is. This is quite the opposite of concentrating the investment advice. It is putting a range of different investment advice for one common investment fund and it is quite the opposite of what he is saying. I did not want to interject but it is meeting the objectives of diversifying risk, not what he is saying, of concentrating it.

4. Senator S.C. Ferguson:

One of the first matters identified by the Comptroller and Auditor General was the fact that the investment funds of the States were all over the place. In fact, some funds, the little funds and the special funds, were, in effect, not being managed and were losing a considerable amount of growth because they were just sitting in gilts or, for the special funds, they were sitting in cash at a time when they should have been in the market. I take the point of the Minister for Treasury and Resources that there will not be a policy of one manager and one big fund. That is a policy that I would not recommend. I understand they will follow the policies that they have been observing from the various funds up until now with different managers covering different aspects of the investments. Frankly, I think it is absolutely about time this was done. I regret that we have not done it before because a lot of these smaller funds, or the million pound funds and so on, have lost a lot of growth by just sitting in gilts from year to year over a period of years. So, yes, I am all in favour of this and it is about time.

5. Deputy G.P. Southern of St. Helier :

It is a common phrase used in this House and one I try to use rarely but I remain confused by this proposition despite the assurances just heard from Senator Ferguson and from the Minister for Treasury and Resources. While I accept that some funds may have been lying around languishing and that they should have been more actively managed, it seems to me that what we have got here is we are setting up another layer of management. It says here: "Each participating fund will maintain its own investment strategy and be able to invest in its chosen range of investments, categories, in line with the strategic aim and ranges" and safety versus risk as they see it with their own advisers, managing advisers, advising on those funds. Yet, what we are saying here and it clearly says we are setting up a common investment fund. So how is this myriad of advisers co- ordinated in the common investment fund? Have we got 300 voices going into this common investment fund or have we put a layer in saying somebody must manage the common investment fund and see what is happening. It seems to me that we are talking glibly about savings produced by economies of scale when all we need is better management and not necessarily the creation of what appears to me to be a new layer of management. We talk often about stripping-out layers of management and is it 9 layers between the chief executive and the bottom worker in some ridiculous organisations? We appear to be putting another layer of management into our structures here and I do not quite frankly see where the economies of scale as such are going to work. What we need is better management of our funds, not necessarily this solution.

6. Deputy T.A. Vallois of St. Saviour :

As a previous member of P.A.C. and being party to the E.f.W. (Energy from Waste) Report, it was identified that there were issues with risk management within Treasury. I would therefore have to ask the Minister for Treasury and Resources to reassure the Assembly that the area of risk management within Treasury has been addressed and restructured as mentioned within his Treasury Restructuring Plan, which was established in August 2009. Could the Minister therefore confirm that restructuring of Treasury has been completed and be able to provide a risk management structure as to how this will be implemented and the accountability that will be in place and not only within the Ministerial body?

7. Senator J.L. Perchard:

Just briefly, I just would like to ask the Minister when he is summing up to explain to the House as to how the common investment fund will be managed. Can the Minister, for example, reassure me that the total of the common investment funds which will run into over £1 billion will be, for example, divided into perhaps 4 funds of the total given to 4 different investment houses to manage

on our behalf to ensure that the scenario as outlined by the Deputy of St. John does not happen? Also, could the Minister advise the Assembly of what formal procedures will be in place when the Minister is required to accept investment advice? Who is his sounding board? Is it a Ministerial decision on its own, which could be worrying, that one person has all this control with all Jersey's reserves? What is the procedure and there needs to be a formal procedure that the Minister must adopt when accepting investment advice. So, fully supportive of the principle. This comes down again from a Comptroller and Auditor General recommendation and it is not before time that all these funds were collated and invested professionally on behalf of the people of Jersey.

8. Deputy R.G. Le Hérissier of St. Saviour :

Just to echo basically what Deputy Southern and the Deputy of St. John and now Senator Perchard have said. This is deceptively simple and I, like Deputy Southern and the Deputy of St. John, am struggling with whether this is indeed a smoke and mirror proposition. It is deceptively simple. The investment apparently will continue as before with all the diversity implicit in that and so forth. I would like the Minister for Treasury and Resources to explain where the simplicity lies and whether there will be a change to the actual ways in which investment is managed and whether they will be rationalised. If they are rationalised, does this mean we could, I suppose, end up in a situation where we are beholden to one set of managers?

9. Deputy I.J. Gorst of St. Clement (The Minister for Social Security):

If I could start by addressing this idea that we are inserting another level of management. That is not the case. There is a manager already within the Treasury Department and the committee which oversees the investment management strategies for the States investment. That individual and body will simply in future oversee those investments held in what is the S.I.T.H. (States Investment Treasury Holdings). We have got to remember that this is a tool to allow economies of scale. What we currently have is several different funds, stand-alone funds as it were, following several different investment strategies. Sir, I know you understand exactly what I am saying but for the sake of Members so we currently have these investments separately. They could be following the same investment strategy so it could be that the Strategic Reserve is following the same investment strategy as the Greville Bathe Fund or the Social Security Fund, for example. What this will allow is for those same strategies to be run together and to allow the Treasury to benefit from economies of scale. We all know that the more money that one has invested with a particular investment house then one can negotiate, improve fee structures, and that is what this instrument will allow. So basically it will not be increasing the risk profile by putting all the investments with one investment house. It will allow for several different strategies, for example cash, bonds, a different approach to equities. It will allow us, in actual fact, to spread our risk and it will allow those small funds to spread their risk in a way that they have not been able to do because of the economies of scale as it currently stands. So it will not be introducing an extra layer of management. What it will be doing is allowing the Treasury to be more flexible. It will be using the same management individuals but it will be allowing all the investment pots to access varying strategies, one would hope at a reduced cost. It will not be increasing risk. In actual fact, one could say it will be helping to mitigate risk again because those smaller funds can access lots of different investment approaches. So I hope I have answered the questions that Members have raised. I am fully supportive of it. It is something that I believe we should have done a number of years ago, as the Comptroller and Auditor General suggested and as Senator Ferguson suggested, and I hope that

I have not muddied the waters for the Minister for Treasury and Resources in his summing up. [10:30]

10. The Connétable of Grouville :

Yes, it is a thoroughly good idea. I was involved with Senator Ferguson and the C. and A.G. (Comptroller and Auditor General) when it was first discussed and we pushed this forward as hard as we could. It has taken a bit of time to get there. The only question I have is perhaps the Minister for Treasury and Resources could explain to us how we are going to make the savings on this, because the costs, I understand, will be the real factor to our benefit.

The Bailiff :

Does any other Member wish to speak? Very well. I call upon the Minister for Treasury and Resources to reply.

11. Senator P.F.C. Ozouf :

If I may say so, there has been a number of excellent questions raised on the extremely important issue of the management of States assets. One thing I have taken away from the debate so far is that I will arrange a briefing for Members on the investment strategy that we would carry out. Clearly, it is an important issue that Members are interested in and as soon as possible I will arrange a proper formal briefing by the Investment Sub-Committee of what we do. A number of Members have quite rightly said that this is something which has been recommended by the Comptroller and Auditor General and, indeed, something which was put already in place by my predecessor and this is effectively the combination of a lot of work to bring forward proposals for a common investment fund. A number of Members have asked what are the current arrangements and how does this work. The current arrangements, which pre-date Ministerial government, were set up in the old Finance and Economics Committee days. There was set up an investment sub- committee of the then Finance and Economics Committee. It was set up then when former Deputy Maltwood chaired it and sat with former Deputy Crespel who were the members of the investment sub-committee who would sit with the Treasurer of the States and one independent investment adviser who have been for many years the overseers of the investment advisers, holding the underlying investment advisers to account and advising how managers should change. The sub- committee effectively carried on through the introduction of Ministerial government. Today the sub-committee is chaired by myself. I rotate the chairmanship of that with my Assistant Minister, Deputy Noel. Social Security - the Minister, his chief officers and the Assistant Minister - join us when we are making particular decisions in relation to Social Security and it is that group that sits and decide. We meet approximately 4 times a year. We receive briefings from Hewitt and we receive regular updates of the performance of the investment managers and we make decisions upon advice in relation to changing investment advisers. In the next couple of weeks, we are going to be also sitting to do a beauty parade, appointing a new equity manager who will be looking after approximately £100 million of the equity portfolio. I will explain how the split works in a second. I have been looking at that Investment Sub-Committee. I do not profess to have the experience of individuals like former Deputy Maltwood in investment advice and I have to say I have been uncomfortable in chairing that sub-committee without almost other non-executive members on it. For that reason, in the last few months, I have appointed one additional adviser to me who is simply an adviser on the sub-committee. He is an individual known to Members, the former senior partner of PwC ( Price waterhouseCoopers), Mr. Philip Taylor , who, on an honorary basis, has joined the sub-committee in order to take part in the discussions and ask questions of the advisers and to assent to approve the governance arrangements and I am going to be making some further proposed changes to the sub-committee. I want to harness some of the on-Island expertise that we have in investment management. There are individuals that can be serving in an honorary capacity to help. Ultimately, the decisions are the Minister's but can improve the investment decisions and to hold the many investment managers to account that we have. The arrangements at the moment are that each of the constituent funds has an investment strategy. That investment strategy is laid before the Assembly. The Assembly will have had an updated investment strategy for the Strategic Reserve which, for example, sets out the percentage of the Strategic Reserve that is held in equities and in bonds and in cash. The new investment strategy, which I published a number of months ago, indicated that there was a long-term strategic objective of moving the Strategic Reserve up to, I think it was 40 per cent in terms of equities. The Social Security Fund also has a similar investment strategy where their investment strategy has the total of the £700 million worth of Social Security funds and 70 per cent of that is invested in equities. So each of the individual constituent funds - Social Security, Strategic Reserve, Stabilisation Fund, Health Insurance Fund and some of the other funds - have their own investment advice. What is proposed effectively in the S.I.T.H. is for the individual owners of those funds to continue to have that split of a bond or an equity portfolio but underneath that, for all of those resources, probably in the region of £1.5 billion then to have their own parts of that fund invested in bonds and equities. So the bond portfolio from Social Security will be taken with the bond portfolio of the Strategic Reserve and that will be monitored and looked at as one fund. That has the benefit, to deal with the Deputy of St. John's question, of appointing 2 or 3 advisers and investment managers for that bond portfolio, so diversifying the risk, also making sure that we are getting the best possible benchmarking of performance because clearly there is a multi-billion pound industry of investment advice and different investment advisers can be providing different levels of returns. Within very clear risk- defined boundaries, we want to maximise the return and we want to make those investment advisers work for the interests of the taxpayers who ultimately own these funds. We want to hold those investment fund managers to account. That is what is effectively going to happen with the S.I.T.H., with the unit trust. Individual funds will own parts of the unit trust and we will appoint investment advisers for the constituent parts so there will probably be 3 advisers for bonds, there will probably be 3 advisers for equities, there will be one cash manager. Members may have seen that other jurisdictions invested in Icelandic banks. The track record of Jersey with our risk assessment is that we did not allow investment in Icelandic banks. We had no losses but there is a conservative but nevertheless very well run and, indeed, the results from the cash managers of the States of Jersey, Royal London Asset Management, have provided

The Deputy of St. John : Will the Minister give way?

Senator P.F.C. Ozouf :

I will give way to the Deputy .

12. The Deputy of St. John :

Will the Minister give us an assurance that he is happy that the finance industry across the world have cleaned up their act, given we have seen that they have not cleaned up their act in their many areas?

13. Senator P.F.C. Ozouf :

That is a slightly wider question than I am after. [Laughter] What I can say is that as far as the Investment Sub-Committee is concerned, we are looking for the world's best investment advisers that are going to be working to the highest standards of governance. I can say that there was an investment adviser which we dismissed within the last few weeks because their ratings on the international not that they lost any money, they did quite well in terms of riding the stock market increases of the last few months. The Strategic Reserve has done extremely well on markets in the last few months but nevertheless we look and we hold investment advisers to account for their performance and that is what we do on the Investment Sub-Committee and adding some local Island expertise will assist us to make better decisions. I hope that gives Members a flavour of how the Investment Sub-Committee works. To deal with Deputy Vallois' question, not directly relevant to this but she asked me to the extent that this was relevant to the Treasury restructuring. This is part of a radical overhaul of what the Treasury does, a radical overhaul in strengthening risk management, the sub-committee now deals and reports on a quarterly basis to the currency exposure for the States of Jersey where all of the currency that is exposed, whether it is the euro exchange purchases for the E.f.W. or whether it is tourism's euro control income or whether it is the tax receipts used from the European savings directive. We now have a centrally co-ordinated

managed  approach  to  currencies  that  we  are  not  exposing  the  Island  to  risk.   The  Treasury restructuring plan is now underway. It is going to be finalised by the beginning of September. People are being appointed to the new Treasury departments and I am happy to give Members a briefing  perhaps  on  the  new  Treasury  structure  in  September  and  certainly  something  that Corporate Affairs is doing. All of this is designed to ensure that all of States money is managed better, that we get better returns, both in terms of investment and utilities. So I think that I answered Deputy Vallois' question. The issue that the Constable of Grouville raised in terms of savings; it is savings in terms of administration. We are extremely hard in relation to getting the best possible deal in things like custody arrangements, in terms of administration fees but when you are dealing with maybe an equity portfolio of £200 million, you get better deals in relation to the administration costs. Those are better administration and lower administration costs than are, for example, available to, say, the Greville Bathe Fund that only - I say "only" - has a number of tens of millions of pounds. The smaller funds will benefit from the scale of investments that we have at Social Security and Strategic Reserve but also those smaller funds will be .. and Senator Ferguson was absolutely right to say that there are some smaller funds, the Greville Bathe Fund originally owned Ann Street Brewery which went into C.I. Traders which was then sold. That was originally effectively a shareholding, an equity holding and we needed to find an efficient but managed and risk managed strategy for dealing with the Greville Bathe Trust and that is going to be of benefit to the smaller funds that perhaps have not had the scale of investment advice that they have in the past. So I hope that I have answered all Members' questions in relation to that. This is an important issue. It was in the Business Plan as approved by the Assembly and I ask Members to support the principles.

The Bailiff :

The appel is asked for then in relation to the principles.

Senator P.F.C. Ozouf :

Sorry, I apologise, I did not address Deputy Le Claire's important points. He raised the issue of ethical investment. I have already explained the new arrangements that we have in relation to the Investment Sub-Committee and what I am going to do, Deputy Le Claire kindly has sent me his report on ethical investment and it is something I think that would be best pursued by inviting Deputy Le Claire to see the Investment Sub-Committee to see whether or not we can put some policies in place in order to get ethical investments. I should say that both the equity portfolios and the bond portfolios are of the highest quality in terms of almost being very conservative but trying to  get good rates of return  if we  can put  into  it. Many  global  fund  managers  have ethical investment strategies. I would welcome Deputy Le Claire in engaging with the sub-committee in order to find that and I will do so as soon as possible. I apologise for not answering his question.

The Bailiff :

Very well, the appel has been called for then in relation to the principles of Projet 35 - the Draft Public Finances (Transitional Provisions) (No. 2) (Amendment) (Jersey) Regulations. I invite Members to return to their seats and the Greffier will open the voting.

The Bailiff :

Senator Ferguson, is this a matter you wish to have referred to your panel?

Senator S.C. Ferguson:

No, Sir, we will, no doubt, come back to it in due course to see how the policy is working but at this point in time, no.

The Bailiff :

Very well, then. Do you wish to propose, Minister, the 4 Regulations together?

Senator P.F.C. Ozouf : Yes, Sir.

The Bailiff :

Are they seconded? [Seconded] Does any Member wish to speak on any of the individual 4 Regulations? Very well. All those in favour of adopting Regulations 1 to 4, kindly show? Those against? The Regulations are adopted. Do you propose in Third Reading, Minister?

Senator P.F.C. Ozouf :

Yes, Sir, and in so doing, I thank Members for their support. The next issue that Members will see is the publication of a revised investment strategy which will set out the constituent components of what will be going into the common investment fund and an updated strategy of the components of equities and bonds. I welcome Members' comments on that strategy which will be published as soon as they come into being.

The Bailiff :

Are the Regulations seconded in Third Reading? [Seconded] Does any Member wish to speak in Third Reading? All those in favour of adopting the Regulations

14. Deputy P.V.F. Le Claire:

Just very briefly, I would like to thank the Minister for Treasury and Resources for his invitation and also I think he mentioned some important things for us today. Along with seeking to reassure us,  I  would  like to  just say  how  impressed I  was with  him  saying  that he  is working  with individuals from the community in these important areas who are giving their time free of charge in an honorary capacity. I think that is really to be congratulated and I would like to thank him for his invitation for all States Members, at least for my part, to offer to attend these workshops in relation to investments and the new Treasury structure. So I think it was a very generous Minister for Treasury and Resources this morning, at least from where I was sitting, and I would like to thank him for his contribution.

[10:45]

The Bailiff :

Does any other Member wish to speak in Third Reading?

The Deputy of St. John :

Yes. Could I just caution the Chamber on moving forward on this?

The Bailiff :

Very well. Do you wish to reply, Minister?

15. Senator P.F.C. Ozouf :

Just to say that I thank Deputy Le Claire for his comments. I will be considering meeting further with the Minister for Social Security who is my political partner in relation to the Investment Sub- Committee because he holds a lot of the assets. I will be going through a more formal appointment process than I am going to be with for the honorary appointments of some investment advisers but I think that this is an opportunity of engaging and using the services that do exist in the Island of people that can provide some real expertise and help us in making decisions. I am not afraid to say

when I am not an expert in something and could benefit from external advice and I would like to invite the Deputy of St. John. I really think that with a proper explanation, I will convince him that this is meeting his requirements of diversification, cost saving and doing better for taxpayers.

The Bailiff :

Very well. All those in favour of adopting the Regulations in Third Reading, kindly show? The appel is called for, then, in relation to the Third Reading of the Regulations. I invite Members to return to their seats and the Greffier will open the voting.