States Meeting Transcript - 13/10/2010

STATES OF JERSEY OFFICIAL REPORT

WEDNESDAY, 13th OCTOBER 2010

PUBLIC BUSINESS - resumption................................................................3

1. Property and Infrastructure Regeneration: The States of Jersey Development Company Limited (P.73/2010) - resumption.............................................3

1.1 Senator J.L. Perchard:....................................................................3

1. Deputy C.H. Egré of St. Peter:...........................................................6
2. Senator B.I. Le Marquand:...............................................................9
3. Connétable K.P. Vibert of St. Ouen:....................................................12
4. Senator A.J.H. Maclean................................................................12
5. Deputy S. Power of St. Brelade : ........................................................13
6. Deputy R.C. Duhamel of St. Saviour:..................................................13
7. Senator T.J. Le Main: ..................................................................14
8. Deputy F.J. Hill of St. Martin : ..........................................................14
9. Senator B.E. Shenton:..................................................................15
10. Deputy D.J. De Sousa of St. Helier : .................................................16
11. Senator P.F.C. Ozouf : ...............................................................17
12. Deputy G.P. Southern of St. Helier:..................................................20
13. Senator T.A. Le Sueur:..............................................................21

2. Le Clos Gosset: upgrade of heating system - petition (P.102/2010)....................26

2.1 Deputy J.M. Maçon:....................................................................26

3. Composition of the States: Spring election and move to 4-year term of office (P.118/2010)..............................................................................27

1. Connétable J. Gallichan of St. Mary (Chairman, Privileges and Procedures Committee): .........................................................................................28

2. Composition of the States: Spring Election and move to 4-year term of office (P.118/2010) – second amendment (P.118/2010 Amd.(2))..............................29

1. Deputy D.J.A. Wimberley of St. Mary:.................................................29

LUNCHEON ADJOURNMENT PROPOSED..................................................34 LUNCHEON ADJOURNMENT................................................................35

2. Deputy R.G. Le Hérissier: ..............................................................35
3. Senator F. du H. Le Gresley:............................................................35
4. Deputy G.P. Southern :..................................................................36
5. Deputy T.M.Pitman:...................................................................37
6. Deputy M. Tadier :......................................................................37
7. The Connétable of St. Mary:............................................................38
8. The Deputy of St. Mary:................................................................39

3.3. Composition of the States: Spring election and move to 4-year term of office (P.118/2010) – amendment (P.118/2010 Amd.) .........................................42

1. Deputy T.M.Pitman:...................................................................42
2. Deputy A.E. Jeune of St. Brelade:......................................................43
3. Deputy J.M. Maçon:....................................................................44
4. The Connétable of St. Mary:............................................................44
5. The Deputy of St. Mary:................................................................44
6. The Deputy of St. Martin:..............................................................44
7. Deputy J.B. Fox of St. Helier:..........................................................44
8. Deputy J.A. Martin of St. Helier:.......................................................45
9. Deputy G.P. Southern :..................................................................45
10. Deputy P.V.F. Le Claire:............................................................45
11. Deputy M. Tadier :...................................................................46
12. Senator T.A. Le Sueur:..............................................................47
13. Deputy T.M.Pitman:................................................................47

3.4 Composition of the States: Spring election and move to 4-year term of office (P.118/1010) - resumption...............................................................49

1. Deputy R.G. Le Hérissier: ..............................................................49
2. Deputy T.M.Pitman:...................................................................49
3. Deputy G.P. Southern :..................................................................50
4. Senator S.C. Ferguson:.................................................................50
5. The Deputy of St. Martin:..............................................................51
6. Deputy P.V.F. Le Claire: ...............................................................52
7. Senator F. du H. Le Gresley:............................................................53
8. The Deputy of St. Mary:................................................................53
9. Deputy J.B. Fox:........................................................................55
10. Senator B.I. Le Marquand:..........................................................56
11. Deputy J.A. Martin: .................................................................57
12. Senator A. Breckon:.................................................................58
13. Deputy A.T. Dupré of St. Clement:..................................................60
14. Senator T.A. Le Sueur:..............................................................60
15. Deputy M. Tadier :...................................................................61
16. Senator P.F.C. Ozouf : ...............................................................62
17. Deputy S.Power:....................................................................64
18. Connétable P.F.M. Hanning of St. Saviour:..........................................65
19. Deputy A.E. Jeune : ..................................................................66
20. Deputy I.J. Gorst :....................................................................66
21. The Connétable of St. Mary : ........................................................67 Senator J.L. Perchard:........................................................................71 Senator A. Breckon: ..........................................................................71 Deputy I.J. Gorst : ............................................................................73

ARRANGEMENT OF PUBLIC BUSINESS FOR FUTURE MEETINGS ....................74

4. The Connétable of St. Mary (Chairman, Privileges and Procedures Committee):.......74

ADJOURNMENT................................................................................75

The Roll was called and the Greffier of the States led the Assembly in Prayer.

[09:38]

PUBLIC BUSINESS - resumption

1. Property and Infrastructure Regeneration: The States of Jersey Development Company Limited (P.73/2010) - resumption

The Deputy Bailiff :

The Assembly now resumes debate on P.73 - Property and Infrastructure Regeneration: The States of Jersey Development Company Limited - and I call on Senator Perchard.

The Deputy Bailiff : Senator Perchard.

1.1 Senator J.L. Perchard:

Just about every speaker in the debate yesterday afternoon expressed some disappointment with the performance of the Waterfront Enterprise Board since its formation in the late 1970s I think. No, I beg your pardon, 1995 when it was formally incorporated. Disappointment, and different people have different issues with the company but I expect it started with the underpass really, the cinema, the fast food complexes, the steam clock and the hotel described as a carbuncle. It pays no dividends. It is in receipt of taxpayers' funding and has been in receipt of £40 million of the taxpayers' funding and huge areas of very prime real estate. There has not been a lot of confidence expressed in the Waterfront Enterprise Board over the years and much dissatisfaction with the company. We all agree, the Chief Minister said, the current directors of W.E.B. (Waterfront Enterprise Board) have said during this debate that W.E.B. needs to change for the better. We have a proposition here and I have looked at this quite closely over the months, because we have had many months to look at P.73 and its predecessors. What is really being proposed here? When you drill down you look at the memorandum of articles of the Waterfront Enterprise Board, I have them here. These are the consultative documents incorporated in 1996 and this is the original memorandum of articles of the Waterfront Enterprise Board. When you compare this with the proposed memorandum of articles for the new company you can find very, very little difference. I have highlighted a few places and I will talk about them. Basically we are the same company. What is being proposed here, when you drill down and try to find the facts: there is a company name change and the removal of States directors from the board - something which I, as a previous director, would support. The Comptroller and Auditor General supports such a move and I think the States realise that it is a terribly difficult position to put a States Member in. So, the removal of the States Members from the board and a company name change. It also proposes appendix 1 of the document, which is appended to the memorandum of understandings of the new company, is a new relationship, a new shareholder representative to represent the people of Jersey and that is the Minister for Treasury and Resources would become the new shareholder representative and will be expected to hold the company to account on behalf of the people and taxpayers and the States of Jersey. It also proposes, not in the memorandum of articles, but an expanded role for the company, a new role to enable it to function outside the Waterfront as the preferred developer for the States of Jersey, Property Holdings Department, which is a subsection of the Treasury Department of course. We have got the Minister for Treasury and Resources holding to account a company that is being employed to develop States assets on and outside the Waterfront. Cosy but okay. That is about it. I challenge any Member to tell me what other reason there is to create this turmoil? It is not. This master planning and regeneration, do not be fooled Members, can happen tomorrow. It can happen with W.E.B., without W.E.B., with States of Jersey Development Company and should happen, must happen. I applaud the Minister for Planning and Environment for his initiative. It seems like a long time ago, when he decided to engage a master planner for the North of Town. This is something that the States have been deficient on. We should have a vision. It can evolve, it can be changed by successive States but there should be a vision certainly for the Waterfront and possibly

a vision for areas like perhaps St. Saviour's Hospital. There is, we all know, a wonderful States asset there. What is the plan? We have an approved master plan for the Esplanade Quarter, the States approved that and as there is a proposition pending some Members are concerned as to whether the time is right to proceed. But there is an approved master plan for the Esplanade Quarter. Several speakers, including the 3 directors of W.E.B., said yesterday: "We need to create the States of Jersey Development Company so we can proceed with the Esplanade Quarter." This is simply not the case. W.E.B. have everything they need to proceed to develop the Esplanade Quarter.

[09:45]

The reason why I suggest the Esplanade Quarter is not being progressed at the moment is that there is a lack of confidence out there in investors, plus prospective tenants, somebody is mentioning Harcourt; there is a problem with Harcourt but there are, of course, other developers. But the fact is the momentum is not there at the moment, not like it was pre-2008. There was a momentum and it is difficult now. It is difficult at this time. There are lots of reasons but basically these reasons are based around the financial downturn that happened 2 years ago. Others have said that interfering Ministers might be the problem, interfering States Members holding up the progress: this is not the case. W.E.B. have the ability in law, the tools in practice to deliver a first class Waterfront. Changing the name of the company or the lines of accountability are not the reasons why this is not happening. So why are we trying to drive this through now at this time? Why do we not recognise the deficiencies of W.E.B. and try and put that right? We do need some skilful new directors and we do need to remove the States directors from the board, not because they are not skilful but they have, as has been identified, a conflict. We do need to define clear lines of accountability and shareholder accountability for the board. The board need to know what is expected of them. We should be charging W.E.B. at this time into turning itself into a trusted reliable efficient company, one that proves that it is capable of expanding its operations into other areas of States of Jersey development. We are asking this company, when we are not satisfied with it, to expand and to take on contracts outside the Waterfront, to have a greater turnover and more responsibility. I am not sure if we are doing this right. Personally I am terrified of the thought of asking a company, that we all admit needs to change and must do better, to expand. There was a suggestion yesterday that we are going to ask the States of Jersey Development Company, if approved, to become a developer and start developing. I am terribly worried, as I say, about this and I just do not want the States to create a monster that we cannot control. I believe we have got a core problem with the structure of W.E.B. and/or the States of Jersey Development Company, should we form it. These are not like any normal plcs. A normal plc and I have been a director of some and very humble beginnings all of them. You stand or fall on your performance. You have the ultimate threat of bankruptcy. Certainly, if you do not perform, your director's fees and remuneration will be affected. I remember those times well in my early years in business that everybody got paid except us, the owners of the company. We lived on a shoestring for many years with the company because we had a vision and we ploughed back any profits we had. The threat of bankruptcy haunts most directors and shareholders. Why I say W.E.B. and the States of Jersey, the chemistry is not quite right because this threat does not exist. This company is gold-plated, it is a cruise liner, it has no risk. The States are there. The staff: what motivates them? They get bonuses; well some get bonuses, even when there is dissatisfaction with the company. What drives individuals, director, an

employee of a company if it is not the promise of profits and a better tomorrow for your business. This chemistry does not quite fit with me and that is why I am concerned about expanding the company, we may be creating a monster.

Deputy I.J. Gorst of St. Clement :

Sir, I wonder if the speaker would give way?

Senator J.L. Perchard:

Deputy I.J. Gorst :

Perhaps he is one of the few people in this Assembly positioned to answer his own question having been a director of W.E.B. in the past.

Senator J.L. Perchard:

Thank you for that question, Deputy . I do speak with some knowledge about the difficulty here. I am not trying to be a vandal here, I am just urging caution. I think W.E.B. should be asked to perform and get its house in order and show that it can be a trusted reliable company before we look to expand it, it is as simple as that. I warn this House that if we do create the States of Jersey Development Company and the turnover doubles, the staff and payroll double, and there is still dissatisfaction and some future Member of this House writes to the Chief Minister and says as I did on the 11th May of this year in a written question in this House asking for information about the activities of W.E.B., contracts, and whether the Council of Ministers would take some responsibility for endorsing these contracts of employment. Of course there was a long well- considered answer but the guts of this answer was: "Senator, you do not have a dog and bark yourself." The States of Jersey appointed a board of directors and they are responsible for the running of this company, which is quite true. But it goes back to my point of being a cushion and a reality that does not exist. They have the support of the mandate from the States to operate but yet they operate in a cushioned cosy world. I think this is dangerous at this time. I cannot see why we do not simply appoint a proper board of W.E.B. and true lines of accountability, give them proper directives and ask W.E.B. to perform. If they can perform then we could consider, in years to come, expanding their role should they be a model. If there are contracts outside the Waterfront that need developing, and there will be, I suspect a master plan; the Regeneration Steering Group would sit, we spoke about St. Saviour 's Hospital earlier, but there are other States assets: Le Bas Centre springs to mind and I am sure there are many more and we will all have our favourite. These can be developed and I would suggest, not by the States, but if we could identify their future use through a proper process and master planning, put them up for sale to a Jersey developer who will employ Jersey people and pay Jersey tax, that would be our most efficient way. Attempting to develop these sites ourselves is dangerous, we are not good at that. What the Waterfront Enterprise Board has done, and I fear what the States of Jersey Development Company might do, is as they have done on the Waterfront: take receipts of hundreds of millions of pounds of States assets and been handed over along with received money of £45 million. To form this company they have States assets which they own. Let us take the Liberation Station or Minister Maclean's new shiny tourism building, let us look at this, simply what happened: we hand over those sites to W.E.B. along with all the land on the Waterfront. W.E.B. then identify a footprint and a developer. They then sell that footprint to a developer for 150 years. That developer, through the proper planning processes and in agreement with W.E.B., builds a building or renovates a building. Then he rents it back, in these 2 cases, to the States. £100,000 a year Minister Maclean is paying for his building and £100,000 Minister Jackson is paying for his, for a century and a half. I did tell you that I come from a small business background but I am not sure that is good business but that is only 2 sides. We have got the whole of south of the Weighbridge where we are doing this. Is this really good practice? A consequence of this is we have got a developer, I think in all cases an outside developer, somebody from outside the Island, who then sublets, if not to the States of Jersey to the U.K. (United Kingdom) usually, retailers, coffee shops, pasty shops, nightclub owners. Jersey is losing its identity here and an opportunity to recover any income tax. This is all outside money, so these are corporates owned outside the Island with their shareholders resident outside the Island contributing no tax. I am not sure, if we just head down and carry on in this direction, whether we are doing any justice to our people of Jersey. I think we are. I think we have started to take stock here and understand not only what we would like a building to look like but how do we want it to function. Deputy Wimberley spoke about community. Obviously these projects need to be

economically viable but we need to consider other areas other than just the bottom line and we are not doing that very well. I urge caution, I can feel that I am on the verge of being repetitive, and I see no reason why the States need to embark on this huge company at this time, extending its role and asking it to become bigger and possibly more dangerous. Insist that W.E.B. starts to perform, to get its house in order, to start providing value for money for Jersey and to turn around its terrible image that it has with this House and with the people of Jersey before we expand its functions.

Senator S.C. Ferguson:

Sir, can I ask for point of clarification? Would the Senator be able to tell us if the tourism building negotiations were done when he was a director of W.E.B.?

Senator J.L. Perchard:

No, I am not and of course the Senator ..

The Deputy Bailiff :

You were asked to clarify Senator, please carry on.

Senator J.L. Perchard:

Thank you. I am not able to clarify that but of course the Senator must understand that the negotiations between the Tourism Department over that building are not held with W.E.B., they are held with this developer who has a lease for 150 years.

Senator S.C. Ferguson:

Sir, it was not quite my clarification. Was the Senator..

The Deputy Bailiff :

You asked whether he was a director and he said he was not able to clarify that, Senator.

Senator S.C. Ferguson: All right.

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

Sir, if I could be of assistance, I know that we covered that on Shadow Scrutiny before the Senator was in the States so he would not have been a director.

Senator A.J.H. Maclean:

Sir, sorry, I just might be a little help on that matter, the Senator was referring to the building of tourism, which obviously is occupied under my department ..

The Deputy Bailiff :

Senator, you are going to speak in a moment. Do you want this to count as your speech?

Senator A.J.H. Maclean:

No, Sir, I was going to clarify the point.

The Deputy Bailiff :

If I may say so, we will come to you and you will be able to speak later on it, if it is a relevant point. The Deputy of St. Peter .

1. Deputy C.H. Egré of St. Peter :

I am pleased to follow a former director of W.E.B. This particular process has proved to be a very, very sad exercise. We, as a Scrutiny Panel, as has been rightly pointed out by the Chief Minister, have been looking at this particular proposition over a period of about 2½ years. During that period we saw the Minister himself pull back on the Jersey Enterprise Board.

We then had the proposition for the setting up of S.O.J.D.C. (States of Jersey Development Company). We reviewed that, it came to the States and it was decided to reference back for further information. We now hit what has turned out to be a very interesting timeline. The Chief Minister's office, and I use those words advisedly, went back and produced P.79 reissue. As a Scrutiny team we had been waiting for that P.79 reissue to come to the fore. It did, with a due debate date of 19th July 2010. At that particular point I was invited, as I have already mentioned before, by the Chief Minister to attend a meeting in his office which a member of the Scrutiny staff attended with me. At that particular meeting the first comment that was made by the Chief Minister was an apology for the delay because, as part of the original review, the Chief Minister's office decided to set up its own independent review of the role of W.E.B. through DTZ. We were obviously awaiting that DTZ report. That DTZ report was published to the officers within the Executive, both at Planning and elsewhere. It was not given to the Scrutiny team, as would have been expected. Eventually I did get a copy. At that particular meeting the Chief Minister did apologise for the delay, from January through to June: the cause was because of a dispute between DTZ and W.E.B. Now lots has been said by the directors of W.E.B. that there was no dispute. I was at that meeting and that was said. It was dutifully noted by my member of Scrutiny staff. Also at that meeting the Minister for Treasury and Resources was there, the Chief Executive was there and also another executive was there. At no time did anyone leap up and tell the Chief Minister: "Chief Minister, you got that wrong, there was not a problem." During that same meeting I pointed out to the Chief Minister that the P.79 reissue, in the actual provision itself, stated quite clearly that W.E.B. was to have a name change into S.O.J.D.C. This was totally contrary to the recommendation that we had put in our report, which was that there should be an absolute clear division between the change over from W.E.B. to S.O.J.D.C. It was underlined within that report, to make sure there was no doubt, there was that true division. That recommendation was accepted in its entirety by the Executive at that time. It is interesting to note, looking at the timeline that was given to us yesterday, that P.73 was set up on the 18th June 2010. There is the first anomaly because at that meeting, when I highlighted the fact of how the proposition was written, P.73 appeared the following day, within 24 hours, with that amendment having taken the element out where the proposition was stating that there was going to be a name change from W.E.B. to S.O.J.D.C. It was at that point, and not at 18th June 2010, that I informed the Chief Minister that we would be carrying out a review. As part of that review we requested that we were able to receive copies of the original DTZ report. I had discussions with the Chief Minister in this House, before we were sitting, on a couple of occasions and he assured me that he was going to attempt to make sure that we had available to the panel the original DTZ report. On a particular States sitting, which I recall very clearly, I had spoken to the Chief Minister in the morning requesting that we get a copy of this DTZ report and he said: "Yes", he realised it had not been done and he was going to try and get it actioned. It was to my amazement, when sitting in this chair, that I received an email on one of these dreaded mobile phones to tell me that a letter had been sent from the Chief Minister's Department to my Scrutiny officer, indicating that the DTZ report would not be available to us. Furthermore, I was astounded to note that within the letter there was a line which stated: "I have discussed this with the Chief Minister and the Chief Executive and we concur with the view." Now, that surprised me because I had had that discussion with the Chief Minister literally a matter of a couple of hours before. I left the Chamber and went up and got a hard copy and I then attempted to find the Chief Minister, which I did. I said: "Have you seen this?" and he indicated that he had and he was dealing with it. I then went back up to the Scrutiny office and briefed my Scrutiny officer accordingly and she said to me: "Well that is strange, Deputy , because I have just had a telephone call from the Chief Executive's office asking me not to send out that email regarding the DTZ report being released." Because apparently, from the telephone

conversation she had had with the Chief Minister's office, the word was "something has come up". What came up was that the Chief Minister apparently had not discussed it with the Deputy Chief

Executive who signed-off the letter saying that we were not to have it. You can imagine the concern that that rattled around within the Scrutiny Panel: "What is going on here?" Bearing in mind that both the Chief Minister and the Minister for Treasury and Resources have, on many occasions, said in this Assembly how important it was that the actual relationship that they had between the Corporate Scrutiny Panel and the Executive, it had been working very well up until this point. To cut the story short, eventually we did get a copy of the DTZ report, the original copy, and we were then able to compare it with the final copy. As the Chief Minister has always said, he respects the role of the Corporate Scrutiny Panel, and when we signed-off a confidentiality agreement we mean it. So the DTZ report was given to us in confidence. We have heard remarks made on the floor of this Assembly about perceived differences in the 2 reports. I have here - and it will not be available to everybody so trust me - a document which compares information from both the original report and second report. There are 30 differences in tone and content. Some of them are trivial, some are not but there were that many changes. We continued with our review. We spoke with the Chief Minister, we spoke with the Minister for Treasury and Resources, we spoke with Property Holdings and we spoke with the board of directors of W.E.B. I would just like to cover that last particular element because I know the Constable of St. Peter did mention it. The panel invited W.E.B. to come and speak to us and we invited the Managing Director and the Finance Director, I believe, as I recall. We then got a message from the Managing Director saying that he was going to come with the whole of the board. Now that is unusual. The invitation normally comes from the Scrutiny Panel, not the other way around. It was the Managing Director and the Acting Chairman of the board which we thought would cover both issues, the executive directors and the non-executive directors. I did invite another member of the board to attend. The idea that the board were not able to put their views across to the panel I find strange. I do not think you need a full board of non-executive directors to put forward the view of the board when their Acting Chairman is there. The issues continued. There were rumours and statements made about contracts and the inability to move W.E.B. and S.O.J.D.C. together because of complications with the contracts. There were 2 issues with contracts: one issue was to do with development contracts, which have already been talked about, the other one was quite clear to do with contracts of individual members of the executive directorship. Firstly, I must apologise for getting it wrong because we did ask for the contracts of the executive directors. I have now been informed, rightly so, that there is only one executive director because the Director of Finance, apparently, is not an executive director. I apologise for making that mistake and I certainly have not made that same mistake when dealing with Jersey Post, who have their financial director as an executive director, and I was surprised to note that there is only one executive director involved at W.E.B. The Assembly will be aware of the problems we had in getting those contracts. I was amazed yesterday to be told that we were going to have access to those contracts at 4.05 p.m. yesterday afternoon for the contract. I had a very open and frank discussion with the Managing Director of W.E.B. who turned up in this Assembly - in the rooms downstairs - and allowed me to go through his contract in detail. I have to say, that having read it, it left me in dismay; not by the fact that there was anything in that contract that was difficult to understand, not that there was anything there that came in the contract that surprised me but the fact that the Scrutiny Panel had had to wait for 6 weeks for information that we have just received and received yesterday. As a result of that, and let us make it absolutely clear, Scrutiny has not been able to do its job. It has left us in a position where, had

we been given that information 6 weeks ago we would have completed our report in full. Furthermore, we would have had the opportunity, which we do not have now, to put in any amendments which we may have felt were necessary. Let us make it absolutely clear at this stage, as was made clear by the previous director who spoke, this move is quite simply the move from W.E.B. into an expanded S.O.J.D.C. I have found it difficult that the Minister for Treasury and Resources has stood in this Assembly and said, almost, that the world is going to fall apart if this does not go through. Be reassured that the world will not fall apart. I concur and perhaps, given the opportunity, may still bring an amendment which would have suggested that we continue with W.E.B., that we set up a proper constituted board as robust as the Minister for Treasury and

Resources has suggested, so that should a move into a development company that is going to expand its role, that the actual operation is already set in place because it is very clear that any move in the setting up of S.O.J.D.C, that the current Managing Director of W.E.B. will be a party to that particular new S.O.J.D.C.

[10:15]

What we need to do, as Senator Perchard has said, is set up a robust W.E.B. with a new board of directors, selected and chosen and overseen by the Appointments Commission, so they can get on and do a job. A couple of the things that we have not been able to highlight, because we have not been able to put a report out for the reasons I have outlined, is that it would appear that W.E.B. has already gone out and increased its remit. We will know that they are already working on East of Albert, which was not in their remit. We already know that the Managing Director of W.E.B. was working on a working group for the development of areas around the airport and St. Peter. He sits on a working group chaired by the Deputy Chief Officer. I have to say that when I mentioned that during our Scrutiny process the Chief Minister seemed surprised that such a group existed. There have been issues that have gone on around this particular proposition which do not bear close scrutiny. The fact that we have been misled, the fact that I think on occasions the Chief Minister has been misled and quoted out of context, the fact that we have waited for 6 weeks for information that was made available to me yesterday at 4.05 p.m. and, as a consequence, have not allowed us to do our job, I cannot support in any way what we are about to do. I would ask Members of the Assembly to think about what I have said, to think about the concerns that have been voiced and to vote with their head. I am not saying we stop everything. I am saying if we are going to set a ship afloat we set it afloat as a full-running facility. My final recommendation would be, and I have not been able to make it, that we sort W.E.B. out before we start expanding its role because that is exactly what this proposition does. [Approbation]

Deputy M.R. Higgins of St.Helier:

Sir, can I seek clarification from the speaker? The speaker mentioned East of Albert and airport developments. There has been a lot of concern expressed to me that there are things going on in the Island here- talks going on - which we know nothing about. Could he please elaborate who is on these working parties, if he is aware of the people, because there is concern that former States Members are part of this?

The Deputy of St. Peter :

I would be trying to pluck names out of the air which would be inappropriate. I know that as far as the working group for the airport is concerned, that it is chaired by the Deputy Chief Executive and that the director of W.E.B. is on that particular working group. I do not have the full details of East of Albert.

2. Senator B.I. Le Marquand:

There is clearly dissatisfaction in relation to the current structures of W.E.B. Listening to previous speakers and the presentation earlier this week it seems to me that this arises in the following areas: firstly, there are issues in relation to directorship and particularly difficulties because of the involvement with States Members and the issues of conflict of interest that can arise between their role as directors of a company and their role as States Members. I think virtually all Members accept that that is an issue. Secondly, there are issues of oversight as to where there is effective political oversight in relation to the assent, the current proposition has the effect of giving greater powers to the Minister for Treasury and Resources with that regard. Thirdly, there are issues as to planning matters: the difficulties which have arisen when W.E.B. has sought to become almost a planning authority and tried to initiate the planning changes, which of course is the role of my colleague, to my right at the moment, Senator Cohen, and there is a need for clarification of that. Fourthly, there is the issue in relation to the ambit of the operation geographically: is it to be

confined to the Waterfront area and areas around that or to a wider issue? I accept that there are those who have concerns, particularly in relation to the fourth issue, they were set out clearly by Senator Perchard this morning, and I accept that those who do not want to see the ambit widen will probably vote against the proposition, that is perfectly logical. However, I think I would say this; we have to accept the fact that the States of Jersey is not good at running commercial enterprises. It is partly not good at that because it is risk-averse and if you are going to enter into the commercial world and seek to make profits you have to make decisions which may involve an element of risk. If you go in on a risk-averse basis you are certainly not going to do it very well. My experience of 20 years in the public sector is that the public sector is absolutely hopeless at trying to run anything of a commercial nature. Because of that issue we have to realise that if we are going to maximise our income, our profits, our capital gains from our land holdings then we are going to have to be prepared to hand over to experts in that field in order to do that on our behalf. That is my view. I accept that others may take a different view on the ambits question. There is also what I would call the secondary issue, but one which I think is in the minds of many Members of this Assembly, relating to the terms and conditions of the Managing Director and, in particular, the size of salary. The difficulty that the States of Jersey has in relation to such areas is that we seek to form companies. We seek to hand over, to distance ourselves, from such matters for commercial reasons but we will still be blamed if things go wrong. We will still be criticised in relation to issues like this. That creates for the current directors a difficult situation. I can see the tension which they have faced. I do not wish to be critical of them but because there is a tension, on the one hand, between commercial business issues, what is the going rate for the job and, on the other hand, political issues, is this politically acceptable to the people of Jersey that such high salaries are being paid? My own personal view, in relation to that, is that sufficient weight is not being given to the political in this case. I think it is politically naïve to have salaries at that sort of level, even in a subsidiary company but that is my personal view in relation to the matter. But as far as I can see, apart from the issue of widening of the ambit geographically of operations, most States Members appear to be content with the general new structure, i.e. the change of directorship issue, the change of oversight and the clarification of planning. Those who are, then we are faced with a situation as to how do we change from where we are to where we want to be? There are 2 ways in which this could be attempted. The first is by forming a new company, a new corporate entity with new purposes and organisational rules. The second is the method which has been selected here, and that is by changing the name of the existing company, changing the memorandum of association. The memorandum of association of a company defines what the company can do; what are its objects, what it can properly do and if it does anything outside that it is called ultra vires, it is beyond its powers and it should not do it. The articles of association are the rules which govern matters like directors, general meetings, et cetera; the general administration of the company. Both routes, the one chosen here or the one of forming a new completely separate entity, arrive at the same point. Different people have attempted analogies in relation to this route. I am going to attempt another one, which I think is more accurate. I am going to talk in terms of caterpillars which become chrysalises and then, subsequently, become - hopefully - butterflies. Some people may think this may become a moth of course but that is a matter of judgment. I think that is a very good analogy because you have this continuity of essence that may help Members of the Assembly to understand it. The reason why the second route has been selected rather than the first route is because of contractual issues. If the first route were chosen, i.e. a brand new body, it could have the same memorandum of articles as what people have now but a brand new body, then there would have to be a transfer of the effective oral contracts. There are 2 different words which are used in this

context. One is the word "assignment" and the other word ..

The Deputy Bailiff :

There is an interruption coming from behind you. Are you prepared to continue?

Senator B.E. Shenton:

It is just that the speaker is incorrect.

The Deputy Bailiff :

You will be able to speak later on, Senator Shenton, if you wish to.

Senator B.E. Shenton: I will educate him later.

Senator B.I. Le Marquand:

Am I being challenged here on law here, Sir, or ..

The Deputy Bailiff :

We are not going to make it a conversation, Senator, so please will you continue with your speech.

Senator B.I. Le Marquand:

I was about to try and explain the difference between an "assignment" and a "novation", which was a term that came up in the presentation and no doubt is in the documents. To help Members to understand the difference between an "assignment" and a "novation" the easiest way is to talk in terms of debt. If I owe a debt to Senator Ozouf , a financial debt, then in law he can transfer the benefit of that debt to any other person he wants. It does not require my consent; it is his asset, he can give it to somebody else. But if I owe a debt to Senator Ozouf and I want to, as it were, pass on the benefit of my debt or the burden of my debt to some other party, I cannot do it without his agreement. The reason is very simply because if I was very cunning I would find a gentleman of low financial means and get him to take it on from me, and then poor Mr. Ozouf might not be paid, and the debt doubles. I explain this to understand that difficulty arises because quite a number of the contracts, in relation to a company of this type, would involve financial obligations. If there was a development there would be an obligation to pay money at different stages. That means that you cannot simply pass the obligation to a third party because you have to have the consent and the agreement of the person to whom the obligation is owed. That is what is called a novation, it requires agreement. In practice, therefore, if that route were followed there would be an enormous amount of legal work; with lawyers, no doubt, earning quite reasonable sums of money or perhaps excessive sums of money, some people might think. In relation to that, a great deal of work, a great deal of effort, a great deal of energy in this I am explaining, I hope simply so people have understood, why it is far preferable to do it by the caterpillar to chrysalis to hopefully butterfly route rather than by the other route. Any suggestion of forming a totally new body runs into all the difficulties which I have talked about. If Members are agreed that we should arrive with the changes of directorship, with the oversight issue improved, with the clarification of planning dealt with and are not against the increase of the ambit geographically then this is the best way. That is the best way to arrive at where we want to be. In relation to the issue of salaries of employees, I would merely say this in passing, that this proposal gives greater control because it gives to the Minister for Treasury and Resources an issue of responsibility in relation to that which he does not have at this time and therefore, if there is a political need for input, that becomes the responsibility of that Minister. Finally, I want to warn Members, and I suspect I will be doing this in the later debate this week, against what I call "a council of perfection". Sometimes we have a situation in which we are seeking to move from one position to another and there are Members who will vote against the change simply because there is some slight detail that they would have liked to have

done differently. That means that we do not vote at all, it may come up, as I say, in a later debate. I warn Members against that. Here, quite clearly, we are moving towards something which is much better than what we have in a number of different areas and therefore, apart from the issue of the increase geographically of the ambit, which I understand people will vote against on that ground, I would urge Members not to vote against simply because of not quite agreeing entirely with some little detail. I shall be supporting this proposition.

3. Connétable K.P. Vibert of St. Ouen :

Yesterday evening when the Assembly adjourned I was challenged by Deputy Higgins and asked whether I was aware that supporting this proposition would mean that a group of people would come into St. Ouen and build on publicly-owned property in my Parish, even on Plémont. I rebuffed what he said but overnight I have been considerably troubled by what he said. Not troubled by the veiled threat but troubled that any Member of this House should, having had in their hand a proposition since 7th June, come here with such ignorance of what was being proposed. What is being proposed is setting up a new company to replace W.E.B.; a new company with wider powers, but that company, in the same way as W.E.B., and in exactly the same way as any private developer, will be obliged to go with the terms of the Planning Law. I would have thought that the Member who challenged me yesterday evening would have heard the words of the Minister for Planning and Environment yesterday where he said that the Minister for Planning and Environment and the Planning Department have to be totally separate from this so there is no chance of this company coming into St. Ouen and building on public land any more than there is a private developer.  [Aside]  I am glad the Deputy of St. Ouen agrees with me.  [Laughter]  This proposition attempts to strengthen what we have at the moment and the majority of Members have pointed out that W.E.B. as it was set up does have certain weaknesses in its set up, and I do not disagree with some of the points that Senator Perchard made, but I think that we would be failing the public of this Island if we did not make an attempt to strengthen that system. That we, in this proposition, would be giving it the ability to widen its remit into the Parish of St. Ouen, if necessary, I have no problem with, because at the end of the day the Planning Department is the department which decides where and when a developer develops anywhere in the Island. The advantages of this new company is that there is a possibility that at the end of the day when land is developed that the public of the Island will be able to receive the benefits which would have fallen into the hands of a developer, and I think that is what we need to be looking at. I will support this

proposition. I have no fears about them coming to build in St. Ouen .

4. Senator A.J.H. Maclean

I do not think I suggested I was going to speak, apart from my earlier intervention but I am more than happy to say a few words. [Laughter] I am not quite ..

The Deputy Bailiff :

You should not wink at me then, Senator. [Laughter] [Approbation]

Senator A.J.H. Maclean:

I think it was more a glare, Sir, after you slapped me down earlier on. Clearly our body language is not working. [Laughter] I think at this point it is probably better if I sat down but I .. [Laughter] Sir, not wishing as I know you are very keen to encourage Members to be as short and succinct as possible, I will make just a few remarks. It is perhaps not surprising to Members that I am supporting this particular proposition. I think it is right that we take the decision now to move forwards. I think it was Senator Perchard when he was speaking earlier this morning who was raising the point about both internally within Members of this Assembly and externally the public, there has been a distinct lack of trust, perhaps appreciation or understanding of W.E.B. since they were set up, what they have achieved; and what they perhaps have not achieved in some people's views. There is clearly a problem here and, I think without doubt, although as Senator Perchard pointed out it may appear at face value that there is little that is seeking to be changed with the new S.O.J.D.C., in fact the reality is it sets the foundation and the benchmark to allow us to move forward with a structure that can be more effective in the future for looking after and ensuring we get better value of the assets that the States owns, and I think that is important. It is a time without doubt, in my view, to draw a line under where we have been and ensure that moving forwards we have a much more effective structure to deal with. There have been a number of points raised,

some of which perhaps were not wholly accurate. Indeed, I was seeking earlier on to clarify a point with regard to Senator Perchard. He was making comments about the failures - I think in his mind - of the way in which W.E.B. interacted with developers for the benefit or not, as he was trying to suggest, the States and the public and in relation in particular to the tourism building which he mentioned. He was suggesting that was not a good arrangement and not a good deal. In fact, it is quite the contrary. The tourism building is a fine building for the occupation of the Tourism Department. I should point out that from a financial point of view that particular lease is preferential. It is a discounted arrangement of which both Economic Development and the States of Jersey are the beneficiaries until 2014. As part of future conditions, my department are looking at other alternatives beyond that so that we can drive greater efficiencies but, at the current position, certainly that has been a very preferential arrangement for both the Tourism Department and, indeed, the public purse. I would encourage Members to consider the overall picture when deciding how they are going to vote. Once the new S.O.J.D.C. is put in place, should Members support the proposition today, that will allow us with that structure to ensure the proper governance moving forwards and the fact that the States assets are properly and appropriately managed. I have nothing more to add other than to encourage Members to take the leap of faith that I believe will, as others do, lead to a much better and more effective development opportunity and structure for the States.

5. Deputy S. Power of St. Brelade :

I will be as brief as the Minister for Economic Development. I think what we have seen in W.E.B. and the development of W.E.B. over the last period of time has been a template for property development on the Island, and that template needs to be adjusted and needs to be changed because it does not fit what we need it to do right now. When I read some of the paperwork and some of the emails that have been flying around and some of the correspondence that has been flying around, not just on this but on other aspects of States decision-making, I say to myself for a small place, my goodness, do we make things complicated from time-to-time. I sometimes wish that we would just get on and make these decisions without the pain threshold that we seem to go through in this Assembly every time there is a major decision to be made. Some of the decisions that have been made in this Assembly have not been good ones and some of the decisions that have been made in this Assembly have been excellent ones. We could rehearse all the arguments about Fort Regent. We could rehearse all the arguments about the Aquasplash. We could rehearse all the arguments about the elevation and design treatment of the Radisson but those were decisions that were made 10, 12 years ago, 15 years ago, and we have got to come on and recover from where we right now. I firmly am of the opinion that the template for S.O.J.D.C. will work. I am firmly of the opinion that we have got to have continuity between the commercial activity, transactions, leases and everything else that W.E.B. entered into. You cannot suddenly, from a legal point of view, park the hundreds of legal agreements that are in place into some cul-de-sac of a company and start with a squeaky new company. It simply cannot happen so we need to be robust here commercially and I think S.O.J.D.C. can do that. My view is that the template for S.O.J.D.C. is a good one, the template for S.O.J.D.C. is achievable and I just think we should get on and do it.

6. Deputy R.C. Duhamel of St. Saviour :

Just a brief point. Quite frequently when this House makes decisions we do not carry them through and I think one of the things that will flow out of a positive decision to endorse the setting up of a new development company is there will be a clarification of the importance of the Planning Department in bringing forward for consideration master plans, strategic development master plans, regeneration zones and, indeed, a coherent forward planning structure but these things do not come cheap. They have to be budgeted for, so I would ask Members in considering when they do decide to vote or not for this particular proposal to bear in mind that at the moment there are not any earmarked monies for the extra work that will have to be undertaken in order to allow the Planning Department to do this important work.

7. Senator T.J. Le Main:

Probably the 2 speeches that I felt that struck me the most during this debate has been certainly from the Connétable of St. Peter on my left and a very short while ago from Connétable Vibert . I felt that they put really in perspective the issues that we are debating today. I also believe that this transition is so urgently needed at this time. We need this new company now. In my view, Property Holdings has been useless now and in the past. Probably, and I am not attacking the staff at all or people involved with it, it is just not the right structure to be able to drive forward some of the issues we need to do. Look at Lesquende, sitting there where we have urgent need for lifetime homes, homes for elderly people; sitting there for years and years and still no action. That land obviously should have been passed over or transferred to the Housing Department, in my view, but that is another thing. Yes, land like Lesquende, the Ladies College, prime development sites have been sitting around, well, just doing nothing. Absolute scandal. I have great faith in the new management set up of W.E.B. and I believe that now that they have, as I say, from the old style under the current leadership at W.E.B., I believe that this can be transferred to the new property company. Well, Senator Perchard was querying and asking why. I will reiterate that I believe that this W.E.B., under the current management and under the current directors, has raised its profile and credibility beyond all doubt. We need a company that is being proposed so that at long last it can be run in a proper commercial manner without the continued interference of the 53 experts we have in this Assembly.

[10:45]

I have never heard in all my life every time that something comes up about planning issues, how many experts we have got in these areas. The time is right. Only last evening I had a lift with the Connétable of Grouville back home and a couple were walking, who live not far from me, and we gave them a lift and they both work for this major bank and the lady was telling us that, in fact, how desperate they were trying to restructure and reorganise the organisation for which she works because of the numerous places and offices they have scattered around the town. We have at this time a huge opportunity to get this company on its feet and to allow it to get on with some of the huge opportunities that are currently before us. We have opportunities now in a recessionary period where we have a demand for development for high quality office blocks. We have an opportunity now to realise very keen pricing. Profits will remain with the States for the public of the Island. It will with this company drive forward developments that have been sitting around, as I say, for ages and nothing is happening, and provide much needed construction work for the construction industry. I think as I say, I do not intend to repeat what has been said by the 2 learned Connétable s, but I think the Members should take the very good advice that they have been offering Members this morning. I certainly will be taking-on their advice and I will be supporting the proposition today because if we do not we are just going to be in a stalemate. We are just going to be not able to restructure our business in any form or fashion, so I believe it is important that we give this new administration, recent administration in W.E.B., who have produced quite considerable States funding over the years from their developments, delivered considerable public assets and is now worth a considerable amount on their balance sheet. I cannot wait to see, as I say, this new property company take the bull by the horns and get into some of the developments that can produce real benefits for the public of Jersey.

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

I will not be too long either but I will agree with Senator Le Main, changes are needed and I do not think any of us dispute that, I think, it is how we get there that is very important. I think that is what this debate is all about because I think that the best speech by far today - and there have been some good speeches - has come from the Deputy of St. Peter. I think it is one of the best speeches ever made in the House. It is a shame he is not here to hear my commendations to him but it really was very good because he spelt-out really where we are now and how we should be doing things and if Scrutiny is to have any purpose at all, and I would urge those Members who have never been

on Scrutiny for the purpose of Scrutiny is to scrutinise and we have a deal in this House. The deal was that we would have the Executive and the Scrutiny would scrutinise what the Executive was doing, and what we have heard this morning from the Deputy of St. Peter is they have not finished the job. He himself has said it may well need amendments to what we are proposing. Now if we are to have any standing at all as a House what we have got to do is to listen to what the Deputy of St. Peter has to say and has said and, in fact, if indeed .. I cannot see it being more than a month, we have been told from the end of November we could come back here with a proposition, I would feel much happier in my own heart. I would say it has not been a very good week for the Executive. If one reads the Napier Report we will see there the number of mistakes made by the Executive where unfortunately the executives have been found wanting and yet we have the same Executive here saying: "Trust me folks, we are going to get there. Trust me." We have had an interim report today produced  by the Corporate Services Sub-Committee made up of Senator Ferguson, the Deputy of St. Peter and Deputy De Sousa. If those 3 people cannot be trusted to finish the job I think it is a poor show on this House. I would remind Members that there were 24 people who voted for the debate not to go forward, 24 wanted to. If we keep to where we were and maybe Deputy Lewis who is out of the Chamber now will remain out of the Chamber so he is not present, we will stay where we are. The status quo will remain. We can come back to the House within a month or just maybe inside 2 months with a proper report from Corporate Services, we can then move forward. I want to support changes at W.E.B. but I would be far happier if I knew that I had the confidence and support of the Corporate Services Sub-Committee, a panel which was put in there by the States to do a job. Let them finish their job.

9. Senator B.E. Shenton:

I think as Members are aware I have not been a big fan of W.E.B. over the years. In fact, if they ever appeared on room 101 it would probably be one of my subjects. I have got a number of points to make. The C. & A.G. (Comptroller and Auditor General) recommended that we remove the States directors from W.E.B., and this is something that is happening and is something that I agree with and I think this debate has borne out the type of conflict of interest that directors of W.E.B. have. All 3, I believe, have spoken in this debate and all 3 have spoken, I believe, as directors of W.E.B. When they are in the Assembly they are elected to represent their Parishes and they are not elected to speak as directors of W.E.B. within the Assembly. I would, therefore, ask that given that they do appear to be in the Assembly as W.E.B. directors today that they abstain from voting because they do not have a vote as a W.E.B. director in the Assembly. This proposition or this move is going to put substantial risk on to the people of Jersey. Substantial risk because the new company will become a property developer, and the residents of Ireland at the moment are bailing- out property developers 10 a penny because these are people that they thought it was so easy to make money out of property development. But, from the point of view of the directors of the new company, this is quite a brilliant concept because I am from an investment banking or investment background and the great thing about being a dealer or speculator for an investment bank is that you are using someone else's capital. You are not putting your own capital at risk in any way, shape or form. If you get it right you will get a nice fat bonus and if you get it wrong the people of Jersey will, in effect, pick up the pieces going forward. The DTZ report on page 13 states that the new company may retain all the development risk itself, and it has certainly been mooted that they will become developers simply because the developers are not out there, and unless you are quite naïve you would also think that there are banks queuing up for new buildings out there. That is not the case; there are empty sites there at the moment that are not being developed. Page 216 of the DTZ report says that the States of Jersey Development Company will retain more risk than is typical in the U.K. so not only are we setting up a structure with risk, we are setting up a structure with more risk than would be typical for a similar sort of structure in the U.K. The people that have got the Waterfront so wrong, we are going to give them the keys to the casino and an open cheque book and then we will pick up the pieces at a later date. Page 230, and this is probably the key part because this is where it mentions the States of Jersey: "Clearly, the States of Jersey will need to be

satisfied that it is aware of the risks that the States of Jersey Development Company will bear." Has this been made clear in the proposition? Has this been made clear in the speech of the Chief Minister or the speeches of the Council of Ministers? We are, as an Assembly, taking on an enormous risk by giving these powers to the States of Jersey Development Company, and they will go back to the proposition and they will go back to that statement that the States of Jersey must be aware of the risk they are taking on in the future if anything goes wrong and if it is passed today. Senator Le Marquand spoke about the problems with novation if the W.E.B. were to be liquidated. But I see this as slightly a red herring because if you were taking over another property company you would not normally liquidate it. You would normally retain the leases in the name of that company and it would simply become a wholly-owned subsidiary of the new company. There are no problems with novation or transfer of leases. The whole thing would be quite seamless so why has the Council of Ministers suddenly led us up this little alley which does not really exist? There would be nothing to stop us setting up a new company with a proper structure and a proper board and for that company just to acquire the shareholding of W.E.B. and the assets that lie within that company. In my view, within this proposition, there is - and this is just my view - a lack of openness about what we are doing today. I am deeply disappointed that it was not referred back to Scrutiny so that they could finish the job because certainly I would have some input into the Scrutiny, having heard some of the speeches which, in my opinion, were slightly light of the true facts. I do not believe that there is the demand out there at the moment. The reason the States of Jersey want to become a property developer is because no one else in this environment is willing to take the risk. It is our money that they are playing with and our assets. If private enterprises and private equity are not willing to invest at this time why should we put the burden on the people of Jersey? None of us are particularly happy with what has gone up there. The majority of people I speak to do not want an underpass. They do not want the soul ripped out of St. Helier . They do not want to live for the next 10 years as a building site. I wandered around the new Dandara development the other day. My wife and I refer to it as Little Torremolinos, because that is what it is. It is just low quality, high density, money in your pocket, let us make it (a) to (j), get the (j)s in there, get the people in for the finance industry. This has got nothing to do with Jersey. It has nothing to do with the people of Jersey. Ultimately, my wife and I are the ones that are going to be taking the risk to make all this happen. So as an investment in the sort of words of Dragon's Den,

we are not delivering, it is too risky and it is not going to deliver and on that basis I am out.

10. Deputy D.J. De Sousa of St. Helier :

I am very happy to follow the last speaker. That was one of the best I have heard him make. Members will be pleased to know that I had prepared quite a long speech, which is very unusual for me, but I will not inflict that on Members because there is no need to because almost everything I want to say has been said.

[11:00]

We have been told by several speakers: "Trust me. We will get there in the end." This House has been asked to do that many, many times. Can I just say, you would not shut the gate after the horse has bolted. Scrutiny is about looking at the evidence and then coming back with recommendations on policy that is brought forward by Ministers. I have been involved in this since P.79. Not as long as every Member. The Chief Minister in his response to our Scrutiny report on P.79 said that the Scrutiny Panel provides useful advice to improve proposals for the S.O.J.D.C. In his opening executive summary on the response to our interim report, the Chief Minister also says: "I believe the involvement of the Corporate Services Scrutiny Panel has been of benefit to the development of the proposition." My Chairman spoke at length this morning on the way that Scrutiny has been hampered in doing this review so that this debate could have been fully informed on a Scrutiny report that would have been brought forward. I will not go over the facts of the hiccups that we had in trying to complete this report but he made a good point, our Chairman. If we had have been able to complete our report we possibly would have brought an amendment, quite an important amendment, to this proposition that we are being asked to debate now. Because we were not able to do our job properly, I would implore that Members reject this proposition. Let Scrutiny complete its work and possibly make an amendment to a new proposition that could come forward. Please, as my Chairman said, use your heads when you vote on this one and please reject the proposition.

11. Senator P.F.C. Ozouf :

I have lived with the current W.E.B. structure for most of the time I have been in this Assembly. I sat on the Policy and Resources Committee and sat to the extent that it was possible to regard that relationship as an oversight and governance arrangement for a period, I sat as a director. I then stood down and I was then the Planning President after Deputy Dubras resigned. As Planning, I think the best decision that I was part of was to stop the monstrosity that was going to be built on what is now known as Esplanade Square and that turning point was the start of the turning point of the architectural improvement plan, which the current Minister has continued. I understand many Members concerns about what has gone on with W.E.B. and Members are right to be critical about past decisions made by all sorts of individuals. They are right to say .. I am exasperated to see the swimming pool at Fort Regent, 11 years on from the decisions made prior to even when Deputy Martin was in this Assembly, still standing there and all of the criticism, understandable criticism, about the cinema complex and the others. Many of those decisions were taken before 1999 and, in fact, if one thinks back, in my view, many of those poor decisions in terms of architecture, in terms of what was proposed, was because of the complete lack of clarity and the absence of a proper documented segregation of duties which separate out the responsibilities for W.E.B. The company board, the governance arrangements, the reporting arrangements; I am afraid I do not agree that it is possible to simply change the current W.E.B. to where Members want and where the public of the Island want. This proposition clarifies and it puts in the right place the responsibilities and the reporting arrangements. Some Members have said this puts more power in the hands of the Treasury. Well, in some ways you could say it is power. I would prefer to say, and I certainly do not seek more jobs for the Treasury, I would say that it puts appropriate accountability. S.O.J.D.C. is fundamentally different from W.E.B. and that is why Members .. I think there are a number of stand-alone reasons why Members should be supporting this proposition, but one of the fundamental stand-alone reasons is the clarity and segregation of the accountability of the

company. In fact, under the new arrangements many Members have spoken about the geographical remit of the company. Well, that is only in theory a remit of the company. Any of the projects that the Board will in future undertake will be subject to specific land transfers. If there is a I am not sure where it exists in St. Ouen or Grouville or, dare I say, Trinity or even St. Peter. If there is going to be a project that S.O.J.D.C. will undertake it will go through a transfer under the protocol which is in this proposition, which I hope Members have read. So the expansion of the geographical remit is conditional upon the Asset Transfer Protocol and Members' ability to deal with a transfer of land under Standing Order 168, which they can strike down and they will know before any transaction is carried out. As far as the responsibilities are concerned, in fact I would characterise S.O.J.D.C. as limiting, as being far more of a limiting role than W.E.B. because it will be upon a project-by-project basis and the policy that was completely opaque, unclear in the original W.E.B. I think W.E.B. was set up almost as a sort of a Docklands Agency, 1980s model, which had planning powers or they thought they had planning powers. The Minister for Planning and Environment is absolutely correct when he said that W.E.B. should never have been involved in master planning, anything to do with the Waterfront. It was a completely confused unclear responsibility. We started it in the old Planning Committee by putting Planning in the master planning role and the Minister has carried on and I think has done a very good job and he has been tenacious and he has guarded his responsibilities absolutely to himself at Planning and this proposition further puts on a written basis those arrangements. The policy remit which I think the Board of W.E.B. and I sat on the Board of W.E.B. and there was not clarity. The policy remit for S.O.J.D.C. sits in the Regeneration Steering Group. It limits the role of the company in a way that

the current arrangement does not. I believe, as I have said, there are a number of stand-alone reasons why S.O.J.D.C. is far better and far tighter in terms of its remit but there is - and Members would expect me to say this - one almost overriding reason why Members, I think, I hope, have the confidence to support this and that is the responsibilities that will be put within the Treasury. The Treasury is used to dealing with owned entities; it has done so before. The former Minister for Treasury and Resources put in place new arrangements for Jersey Telecom and Jersey Post which sets out the responsibilities of the shareholder and the States. I have sought to strengthen those arrangements by commissioning the Deloitte review on States-owned assets. I am just going to spend a moment or 2 just explaining to Members what the Treasury does in relation to a shareholding role because I think that it is absolutely fundamental. The Treasury communicates and explains the objectives that the shareholder has. We do communicate and discuss a dividend policy. We do set out the framework for the engagement with the Board, with clear documented arrangements of no surprises policy, signing-off on business plans, et cetera, quite apart from the responsibility of having to sign-off on significant transactions that are sometimes contained in a business plan. To deal with Senator Shenton's question about risk, risk will only be taken on by the company if it is approved and if it is approved by the specific decisions that we take on a case-by- case basis within the company. The company will be very limited in terms of what it can do. It will be told to get on with projects but within boundaries which will have to be signed-off. It may have been almost a surprise to the company that the Treasury does sign-off at the A.G.M. (Annual General Meeting) the remuneration of directors. Senator Ferguson asked yesterday whether or not I had used that nuclear option. Well, some of the issues concerning that matter almost do not happen because there is the threat of a veto and the threat of a veto avoids decisions that you might otherwise think that you could get away with. But lest there be any doubt, I can confirm that the Treasury under my watch has rejected remuneration packages for entities, and that came as somewhat of a surprise. I am not going to go into the details of it but I am happy to brief the Corporate Affairs Scrutiny Panel. They are aware of the reasons, and perhaps that is why Senator Ferguson asked me the question because I think she understands the circumstance in which that happens, but the Treasury does have a proper oversight in terms of remuneration. I can say to Members that this is not just the Minister for Treasury and Resources making it up as he goes along. Upon advice from within the Treasury we will make decisions that are appropriate in terms of the remuneration and I agree with Senator Le Marquand, this is not a stand-alone private entity in the private sector. This is a publicly-owned corporation and that does have different, I think, methodologies and thoughts about remuneration. You do obviously need the right people and they do need to be incentivised, but this is a publicly-owned corporation. I have absolutely no problem with using those responsibilities at signing-off at an A.G.M. If this is passed, I will look at the dividend policy. One of the absolutely legitimate criticisms that has been levied against W.E.B. and the current arrangements is W.E.B. were given land at zero cost or at a very low cost. It is, therefore, impossible to judge what W.E.B. has done in uplift value. If you do not transfer the property at the market price, which you would get with a willing seller, you then cannot judge the company on what they do in lifting that market value. That is why some of the issues that Members are absolutely right to be concerned about, and they are right to be sceptical about how much W.E.B. has done, is because it is not clarified and it is not clear. I will look at the capital structuring and I will look at the dividend policy within W.E.B. and if it is upon advice the judgment of the Treasury that W.E.B. should be capitalised in a different way and a special dividend taken out or whatever in relation to strengthening and clarifying the situation that this is a development-by-development agency, then I will do so. I know there is some criticism, and I do not share all of Senator Le Marquand's views on Property Holdings. There does need to be a clear segregation of duties between Property Holdings which holds assets as a landowner and S.O.J.D.C. who acts as the developer. Not a developer in terms of taking the risk and borrowing money in order to carry out the development, but the development agency that will partner with other developers and, yes, I do think that there have been opportunities that have been lost because W.E.B. has maybe passed over all the assets to another entity in order to do it. I want to see