States Meeting Transcript - 17th November 2011

STATES OF JERSEY

OFFICIAL REPORT

THURSDAY, 17th NOVEMBER 2011

APPOINTMENT OF MINISTERS, COMMITTEES AND PANELS....................6

1. The Chief Minister Designate's Nominations ............................................6

1.1 Senator I.J. Gorst (The Chief Minister designate): .......................................6

2. Minister for Treasury and Resources....................................................6

1. Senator B.I. Le Marquand:...............................................................7

1. Senator S.C. Ferguson:..................................................................9
2. Deputy J.A. Martin:......................................................................9
3. Deputy T.A. Vallois ofSt.Saviour:......................................................9
4. Deputy A.E. Pryke of Trinity :............................................................9
5. Connétable P.J. Rondel of St. John : ....................................................10
6. Senator F. du H. Le Gresley:............................................................10
7. Connétable J.M. Refault of St. Peter:...................................................10
8. Connétable D.J. Murphy of Grouville :..................................................10
9. Deputy G.P. Southern of St. Helier:....................................................11
10. Deputy R.J. Rondel of St. Helier:....................................................11
11. Senator P.M. Bailhache :.............................................................11
12. Deputy R.G. Le Hérissier of St. Saviour:............................................11
13. Deputy S. Power of St. Brelade:.....................................................12
14. Deputy K.C. Lewis of St. Saviour:..................................................12
15. Connétable J. Gallichan of St. Mary:................................................12
16. Connétable D.W. Mezbourian of St. Lawrence:......................................13
17. Deputy T.M. Pitman of St. Helier:...................................................13
18. Senator A.J.H. Maclean:.............................................................13
19. Deputy K.L. Moore of St. Peter:.....................................................13
20. Deputy S. Pitman of St. Helier : ......................................................14

2. Deputy J.A.N. Le Fondré of St. Lawrence : .............................................14

1. Deputy S.Power:.......................................................................16
2. Deputy R.G. Le Hérissier: ..............................................................17
3. The Connétable of St. John:............................................................17
4. Senator P.M. Bailhache : ................................................................18
5. The Connétable of St. Mary:............................................................18
6. Senator F. du H. Le Gresley:............................................................19
7. Deputy G.P. Southern :..................................................................19
8. Deputy S.Pitman:......................................................................20
9. The Deputy of Trinity :..................................................................20
10. Deputy T.M.Pitman:................................................................21
11. Deputy J.A. Martin: .................................................................21
12. The Connétable of St. Lawrence:....................................................21
13. The Deputy of Grouville : ............................................................22

3. Senator A. Breckon: ....................................................................22

1. Senator S.C. Ferguson:.................................................................24
2. Deputy S.Pitman:......................................................................24
3. Deputy G.P. Southern :..................................................................24
4. The Deputy of Grouville :...............................................................25
5. Deputy K.C. Lewis :....................................................................25
6. Senator F. du H. Le Gresley:............................................................25
7. Senator A.J.H. Maclean:................................................................25
8. The Deputy of Trinity :..................................................................26

9. Senator P.M. Bailhache : ................................................................26
10. Deputy S.Power:....................................................................26
11. The Connétable of St.Peter:.........................................................27
12. Deputy M. Tadier of St. Brelade:....................................................27
13. The Deputy of St. John:..............................................................27
14. The Connétable of St. Mary : ........................................................28
15. The Connétable of St. John : .........................................................28
16. Deputy R.G. Le Hérissier:...........................................................28
17. Deputy S. Pinel of St. Clement:......................................................28

4. Senator P.F.C. Ozouf :..................................................................29

1. Deputy M. Tadier :......................................................................31
2. The Deputy of St. John:................................................................31
3. Deputy K.C. Lewis :....................................................................31

4. Senator S.C. Ferguson:.................................................................32
5. Deputy T.M.Pitman:...................................................................32
6. Deputy G.P. Southern :..................................................................32
7. Deputy R.G. Le Hérissier: ..............................................................33
8. The Connétable of St. Mary:............................................................33
9. Deputy S.Power:.......................................................................33
10. The Connétable of St. Peter:.........................................................34
11. Senator L.J. Farnham : ...............................................................34
12. Deputy R.C. Duhamel of St. Saviour:................................................34
13. The Deputy of Grouville : ............................................................35
14. The Connétable of St. John : .........................................................35
15. The Connétable of St. Lawrence:....................................................35
16. Deputy R.G. Le Hérissier:...........................................................36

3. Minister for Social Security.............................................................37

LUNCHEON ADJOURNMENT PROPOSED..................................................39 LUNCHEON ADJOURNMENT................................................................39

1. Senator F. du H. Le Gresley:............................................................39

1. Deputy J.A. Martin:....................................................................41
2. Deputy S.Pitman:......................................................................41
3. Deputy R.G. Le Hérissier: ..............................................................42
4. The Connétable of St. Lawrence:.......................................................42
5. Senator S.C. Ferguson:.................................................................42
6. The Connétable of St. Mary:............................................................43
7. Deputy T.M.Pitman:...................................................................43
8. The Connétable of St. John:............................................................43
9. The Deputy of St. John:................................................................44
10. Senator P.F.C. Ozouf : ...............................................................44
11. Deputy R.C. Duhamel:..............................................................44

12. Deputy S.Power:....................................................................45
13. The Very Reverend R.F. Key, B.A., The Dean of Jersey: ............................45
14. Senator P.F.C. Ozouf : ...............................................................45
15. Deputy R.G. Le Hérissier:...........................................................45
16. Deputy S.Power:....................................................................45
17. Deputy R.C. Duhamel:..............................................................46
18. Senator P.F.C. Ozouf : ...............................................................46
19. Deputy J.M. Maçon of St. Saviour : ..................................................46
20. The Deputy of Trinity : ..............................................................46

2. Deputy E.J. Noel of St. Lawrence:......................................................46

1. Deputy T.M.Pitman:...................................................................48
2. Deputy R.G. Le Hérissier: ..............................................................48
3. Senator S.C. Ferguson:.................................................................49
4. Deputy S.Pitman:......................................................................49
5. Deputy J.H. Young of St. Brelade:......................................................49
6. Deputy R.C. Duhamel: .................................................................49
7. The Connétable of St. Lawrence:.......................................................50
8. Deputy S.Power:.......................................................................50
9. Senator P.F.C. Ozouf :..................................................................50
10. The Connétable of St. John : .........................................................50
11. Deputy T.A. Vallois:................................................................51
12. The Connétable of St. Lawrence:....................................................51
13. The Deputy of Grouville : ............................................................51
14. Deputy S.Power:....................................................................51
15. Deputy R.C. Duhamel:..............................................................51
16. Deputy R.G. Le Hérissier:...........................................................52
17. Senator P.F.C. Ozouf : ...............................................................52
18. Senator S.C. Ferguson:..............................................................52
19. Deputy S.Power:....................................................................52
20. Deputy J.A. Martin: .................................................................53
21. Senator S.C. Ferguson:..............................................................53
22. The Dean of Jersey:..................................................................53
23. The Connétable of St. Lawrence:....................................................53

3. Deputy G.P. Southern :..................................................................53

1. Deputy R.G. Le Hérissier: ..............................................................55
2. The Deputy of Grouville :...............................................................56
3. Deputy R.C. Duhamel: .................................................................56
4. Senator S.C. Ferguson:.................................................................56
5. Deputy S.Power:.......................................................................57
6. Senator P.M. Bailhache : ................................................................57
7. The Deputy of St. John:................................................................57
8. Senator P.F.C. Ozouf :..................................................................57
9. Deputy S.Pitman:......................................................................58

10. The Connétable of St. Lawrence:....................................................58
11. Senator P.F. Routier:................................................................58
12. Deputy R.C. Duhamel:..............................................................58
13. Deputy J.H. Young: .................................................................59
14. Deputy S.Power:....................................................................59
15. The Dean of Jersey:..................................................................59

ADJOURNMENT................................................................................62

4. Minister for Housing....................................................................63

1. Deputy A.K.F. Green of St. Helier:.....................................................63

1. The Connétable of St. John:............................................................65
2. Deputy S.Pitman:......................................................................65
3. Deputy R.G. Le Hérissier: ..............................................................65
4. Senator L.J. Farnham :..................................................................66
5. Deputy S.Power:.......................................................................66
6. Deputy R.C. Duhamel: .................................................................66
7. Deputy G.P. Southern :..................................................................67
8. Deputy T.M.Pitman:...................................................................67
9. Deputy S.Power:.......................................................................67
10. Senator S.C. Ferguson:..............................................................67
11. Deputy T.M.Pitman:................................................................68
12. Deputy J.A. Martin: .................................................................68
13. Deputy R.C. Duhamel:..............................................................68
14. Deputy J.H. Young: .................................................................68
15. Senator L.J. Farnham : ...............................................................69
16. The Deputy of Grouville : ............................................................69
17. Deputy J.A. Martin: .................................................................69
18. Deputy G.P. Southern : ..............................................................70
19. The Deputy of Grouville : ............................................................70
20. Deputy T.M.Pitman:................................................................70

2. Deputy M. Tadier :......................................................................70

1. Senator P.F.C. Ozouf :..................................................................73
2. Deputy R.C. Duhamel: .................................................................73
3. Deputy R.G. Le Hérissier: ..............................................................73
4. Deputy J.H. Young:....................................................................74
5. Deputy R.C. Duhamel: .................................................................74
6. Deputy G.P. Southern :..................................................................74
7. The Deputy of Grouville :...............................................................75
8. Deputy T.M.Pitman:...................................................................75
9. Deputy S.Pitman:......................................................................75

10. Senator P.F.C. Ozouf : ...............................................................76
11. Deputy G.P. Southern : ..............................................................76
12. Deputy R.G. Le Hérissier:...........................................................76
13. Senator P.F.C. Ozouf : ...............................................................77
14. Deputy G.P. Southern : ..............................................................77
15. Senator P. Bailhache : ................................................................77

5. Minister for Education, Sport and Culture.............................................78

ARRANGEMENT OF PUBLIC BUSINESS....................................................79 Minister for Housing – result of ballot ........................................................80

1. The Deputy of St. John:................................................................80

1. Deputy G.P. Southern :..................................................................82
2. Deputy S.Pitman:......................................................................83
3. Senator L.J. Farnham :..................................................................83
4. Deputy R.G. Le Hérissier: ..............................................................83
5. Deputy J.A. Martin:....................................................................83
6. Deputy R.C. Duhamel: .................................................................84
7. Deputy M. Tadier :......................................................................84
8. The Deputy of St. Peter : ................................................................84
9. Deputy G.C. Baudains of St. Clement:..................................................85

10. Senator F. du H. Le Gresley:........................................................85
11. Deputy T.A. Vallois:................................................................85
12. Senator P.F.C. Ozouf : ...............................................................85
13. The Deputy of Grouville : ............................................................85
14. Senator P.F. Routier:................................................................86
15. Deputy G.P. Southern : ..............................................................86
16. Deputy J.A. Martin: .................................................................86
17. Senator L.J. Farnham : ...............................................................87
18. The Deputy of Grouville : ............................................................87

2. Deputy T.M.Pitman:...................................................................87

1. The Connétable of St. Mary:............................................................89
2. Deputy G.P. Southern :..................................................................89
3. Deputy R.G. Le Hérissier: ..............................................................90
4. Deputy R.C. Duhamel: .................................................................90
5. Deputy K.C. Lewis :....................................................................90
6. Deputy M. Tadier :......................................................................91
7. Senator F. du H. Le Gresley:............................................................91
8. Senator L.J. Farnham :..................................................................91
9. The Connétable of St. Lawrence:.......................................................91
10. The Connétable of Trinity :..........................................................92
11. Senator P.M. Bailhache :.............................................................92
12. Deputy J.A. Martin: .................................................................93
13. The Connétable of St. Mary : ........................................................93
14. Senator L.J. Farnham : ...............................................................93
15. Deputy G.P. Southern : ..............................................................94
16. The Deputy of Grouville : ............................................................94
17. Deputy M. Tadier :...................................................................94
18. Senator S.C. Ferguson:..............................................................95

3. Deputy J.G. Reed of St. Ouen:..........................................................95

1. Deputy S.Power:.......................................................................96
2. Deputy G.P. Southern :..................................................................97
3. The Connétable of St. Mary:............................................................97
4. Deputy R.G. Le Hérissier: ..............................................................97
5. Deputy M. Tadier :......................................................................97
6. Senator L.J. Farnham :..................................................................98
7. The Deputy of Grouville :...............................................................98
8. Deputy K.C. Lewis :....................................................................99
9. Deputy J.A. Martin:....................................................................99

10. Senator S.C. Ferguson:..............................................................99
11. Deputy S.Pitman:..................................................................100
12. Deputy R.C. Duhamel:.............................................................100
13. Senator P.F. Routier:...............................................................100
14. Deputy G.P. Southern : .............................................................100
15. Senator L.J. Farnham : ..............................................................101
16. Senator P.M. Bailhache :............................................................101

ADJOURNMENT..............................................................................103

[9:31]

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

APPOINTMENT OF MINISTERS, COMMITTEES AND PANELS

1. The Chief Minister Designate's Nominations

The Deputy Bailiff :

First of all, may I welcome on Members' behalf His Excellency, the Lieutenant Governor. [Approbation] I remind Members that the only business for this meeting is the selection of Ministers and the chairmen of committees and panels. Chief Minister, I understand you have a declaration which you would like to read out as to your proposed Ministerial nominations.

1.1 Senator I.J. Gorst (The Chief Minister designate):

Yes, if I may. I, like many Members, am aware that a lot of these posts are going to be contested today and so I welcome that, I welcome the debate about the issues and I hope that we can have a good challenge around the issues that face us and I hope that we will not allow it to become personal. Therefore, I would like to propose first, if I may, for the position of Minister for Treasury and Resources, Senator Le Marquand.

2. Minister for Treasury and Resources

The Deputy Bailiff :

Is that seconded? [Seconded] Are there any other nominations?

Deputy M.R. Higgins of St. Helier :

I would like to nominate Deputy John Le Fondré for the position.

The Deputy Bailiff :

Is that seconded? [Seconded]

Senator S.C. Ferguson:

I wonder if I could possibly make a suggestion. Part of the delay is perhaps due to the fact that everybody wants to speak last. Should we perhaps take lots on it?

The Deputy Bailiff :

Standing Order 117(6) is clear that candidates speak in the order in which they have been nominated but if there is an indefinite delay the chair will just move on. [Approbation] Are there any other nominations?

Deputy J.A. Martin of St. Helier :

I would like to nominate Senator Alan Breckon, thank you.

The Deputy Bailiff :

Is that seconded? [Seconded] Any other nominations?

Senator P.M. Bailhache :

I would like to nominate Senator Philip Ozouf .

The Deputy Bailiff :

Is that seconded?  [Seconded] Very well. Any other nominations? I will shortly ask the candidates to withdraw, other than the Chief Minister's nomination, and when that has happened each candidate will be asked to speak for 10 minutes. I will inform you now that the Greffier will ring a bell after 9 minutes and then ring a bell for a second time at the end of the 10-minute period. When the second bell is rung there is to be no extra time and the speaker must sit down. We then have a period of 20 minutes for questions. The questions and the answers must be concise. I will only allow each Member one question unless there is no one waiting to ask a question who has not already done so. A bell will be rung 2 minutes before the end of the period as a warning and a second bell will be rung to signal the end of the 20-minute period. Once again, there is no extra time, even if a question or an answer is incomplete. So now can I ask Deputy Le Fondré, Senator Breckon and Senator Ozouf to withdraw from the Chamber? I call on Senator Le Marquand to speak.

1. Senator B.I. Le Marquand:

I shall begin this morning by explaining my past experience and natural aptitudes which, combined together, make me a strong candidate for this post. At school my outstanding strength was in the area of mathematics. I have 2 A levels in pure and applied mathematics. Figures and statistics are, and always have been, a source of enjoyment and fascination to me. I could well have made a career in accountancy or statistics but in fact my chosen career was law where one of my best subjects was tax law. In 1977 I founded my own legal practice from scratch and there I gained considerable experience in Jersey property-related matters, specialising in conveyancing. In 1990 I became the Chief Clerk to the Courts, the Judicial Greffier and a chief officer in the public system. Because of my natural ability with figures, I personally produced the departmental budget figures. I also brought about a simplification and various changes to the stamp duty system. In 1999 I became the Island's Magistrate where I compiled my own statistical information on various aspects of the work. In 2008 I became the Minister for Home Affairs. I have worked in the public sector for 21 years, as well as having experience of private sector business. If the Assembly honours me this morning with this post, then I hope to follow in a distinguished line of lawyers who have made very good presidents of the Finance and Economics Committee, including Senators Ralph Vibert and Reg Jeune . I have for some years been closely following the world economic situation and continue to do so. I find the work at Treasury and Resources both exciting and interesting and genuinely believe that I can fulfil this role well. The comments which I am about to make need to be understood against the background of our generally strong economy with almost no debt. I also have great confidence in the business acumen and enterprise of the people of Jersey in terms of continuing to find a successful way forward, even in difficult times. We are very fortunate to have a fully-funded Social Security pension scheme and substantially funded public employees' P.E.C.R.S. (Public Employees Contributory Retirement Scheme) and teachers' T.S.F. (Teachers' Superannuation Fund) pensions. However, the challenges which the next Minister for Treasury and

Resources will face are substantial. There are short-term challenges in terms of eliminating the current annual deficit on the Consolidated Fund by 2014. However, there are also major long-term challenges. The draft long-term capital plan which spans 2012 to 2032 shows a capital funding gap of the order of £300 million, even if major policy changes are made in terms of new charges and a new way of funding public housing schemes. Without those changes it will be substantially more. Work has been done, and needs to be completed, on a long-term financial strategy. I have been very impressed by similar such work completed in New Zealand. Such a strategy will need to predict not only the effects upon public sector expenditure arising from such pressures as the ageing population, but also the effect of this and other factors upon public sector income, which is often overlooked, that with an ageing population there will be a drop in income levels and therefore in personal taxation. There has been recent publicity about the size of the deficit on the public employees' and teachers' pension schemes. My information from the Treasurer is that the current deficits on the pre-1987 schemes are of the order of £200 million but there is no guaranteed payment level and therefore no guaranteed liability on the post-1988 schemes. If appointed I shall urgently be looking at this issue and reporting back to this Assembly, and to the general public, as to what I have found. However, I am clear that Financial Reporting Standard 17, which was the basis of the comments of the P.A.C. (Public Accounts Committee), is not a good way of assessing any deficits. I am also clear that there will need to be a review of the way in which we are dealing with the repayment of the debt on the pre-1987 schemes. I believe that it is vital that States Members and the general public are made aware of the size and scope of all these major challenges so that we can plan wisely for the future of ourselves, our children and our grandchildren. If we are to avoid continuing down the path of recent years with ever-increasing taxes and other charges to the general public, then we are going to have to be both very cautious in relation to agreeing to additional expenditure - there will be some needs, most certainly, but we will need to be cautious - and we are going to have to embark upon a major public sector change programme.

[9:45]

Such a programme will look at the services which we provide, the way in which we provide them and whether we are getting value for money for the general public. It will look at the continuing viability of the public sector pension schemes and at the whole of the terms and conditions of public employees, including the incremental system and the Hay evaluation system. This will take between 5 and 10 years and will follow on from the work of the Comprehensive Spending Review. It must be done but it also must be done fairly and with proper negotiations and consultation with employees' groups. We owe that to our public employees. I turn now to some of the numerous key issues which will face the next Minister for Treasury and Resources. The taxation of non-financial service companies is an area which continues to cause great public concern. That is, in my view, partly because the reasons behind the Zero/Ten policy have not been fully explained to States Members and to the general public. We must first obtain from the European Finance Ministers' meeting later this year confirmation that following the repeal of the deemed distribution provisions the current policy is not harmful. After that we can review the position and see what can be achieved within the constraints of the code of conduct for business taxation. I will support the continued development of Treasury management and investment strategies to increase the return on investments, while not taking undue risks. I also support the current ethical strategy in terms of investments. I am particularly interested in developing the investment of funds, such as the Currency Fund, locally in creative ways which will assist in achieving other States goals. I am therefore generally supportive of the Gigabit Jersey project, although I would want to see the internal business case in detail before finally approving anything. I am also generally supportive of the use of this fund to assist with the financing of Housing capital projects. I believe that we have to be more creative in our use of our reserves and to turn them to good advantage in terms of our goals for social and other policies within the Island. I would like to explore with the management committee of the public employees' pension funds as to whether there is indeed scope for any similar investments of funds from those directions within Jersey. I support the maintenance of the 20 per cent flat rate for tax which has been a key part of fiscal strategy for so many years. I also support the work being undertaken by the Tax Policy Unit in a variety of areas, including the monitoring and evaluation of the new policy on 1(1)(k) residents. The maintenance of the international reputation of the Island is of very great importance to the successful continuation of our main industry, the finance industry. Although we also need to be maintaining other industries, the finance industry produces 40 per cent of G.V.A. (Gross Value Added) at the current figures and 3 years ago it was 48 per cent. Accordingly, I will strongly support the work of the Financial Services Commission in maintaining standards and the continuation of the process of signing tax information agreements and other moves towards us remaining compliant with international standards. I shall have to speed up so I deal very quickly with the other topics. The next topic I was going to deal with was the Property Holdings Department and the issue of the rationalisation of States office accommodation, which is incredibly important. The topic after that I was going to deal with was the way in which the Minister for Treasury and Resources should work. I am quite

clear he must work in collaboration with his colleagues and in particular with the Chief Minister. The next topic after that was procurement which is a very important issue within the Treasury. The next topic after that was the debate in September 2012 on the 3-year financial plan. We must get the level of expenditure right; neither too high nor too low. Finally, if appointed today, I very much look forward to working closely with the excellent Treasury staff and with my new colleagues on the Council of Ministers and particularly the new Chief Minister.

The Deputy Bailiff :

Thank you, Senator. The time is now open for questions. I call on Senator Ferguson.

1. Senator S.C. Ferguson:

The Auditor General mentioned recently the 2 mutually-exclusive policies we are following: low tax and increasing expenditure. How will the candidate approach this conundrum?

Senator B.I. Le Marquand:

I think I have given the answer to that already in terms of the issue of us needing to have a fundamental change in the way in which we do business. Frankly, the current position as outlined by the Senator will not otherwise be expendable. We have to find better ways of delivering services and keeping our costs down.

2. Deputy J.A. Martin:

I re-read the Senator's speech when he stood for Minister for Home Affairs and he pointed out a lot of problems they had. Can the Senator convince me that he dealt with all these problems at Home Affairs and why would I have faith? He has given me a lot of promises again as to what he thinks he can do at Treasury. I need to be convinced why he has jumped ship from Home Affairs to Treasury and that he will deliver anything he has just promised, because I cannot see much he really did deliver in the last 3 years and I would like to know why he is jumping ship.

Senator B.I. Le Marquand:

In fact, I am not jumping ship; I am of the opinion that things are now going so well at Home Affairs that indeed the major issues and problems have been solved. I have lodged in the last week the law in relation to the police authority, which was a major piece of work. I have taken successfully through the States a major piece of legislation in terms of repatriation of prisoners which should have the effect of reducing numbers. The whole ethos and morale of the police force and the way in which it is operating has been transformed in a very short period of time. I can say honestly that each of the sections of Home Affairs is well led. We have good chief officers, good management teams in each area, and I have every confidence for the future. It is because of that that I feel I can aspire to another role because things are frankly going so well.

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

Could the candidate state his views on the current personal tax structure and what his vision would be for a long-term tax strategy?

Senator B.I. Le Marquand:

That covers so many different issues; that covers a full range. There is a need for review of issues, particularly a need to review the issues of how the 27 per cent rate is working; that needs to be looked at. In general, I think the personal structure is fine. I would hope, as finances allowed, to be able to make provision within amendments for giving more back, if we can, to middle-Jersey who certainly have been hit very hard by the current situation.

4. Deputy A.E. Pryke of Trinity :

As we know the health service will need significant investment in the future, be it a new hospital which costs £300 million, or refurbishment of the present one, but also in services. How does the candidate plan to raise the funds that will be required?

Senator B.I. Le Marquand:

This is exactly the problem which I have highlighted in the capital expenditure long-term forecast over the next 20 years. The substantial part of the £300 million is an estimate of the £300 million for the hospital itself and that is a problem which is going to have to be solved. I do not at this moment in time have a solution to that; I am not going to pretend that I do. What we have to do is make everybody aware of the problem and then we are going to have to work through finding solutions but I have no magic wand.

5. Connétable P.J. Rondel of St. John :

Given if you are successful in your bid to become the Minister for Treasury and Resources, would you give an undertaking to all of our commercial tenants that you will review the recent decision by Property Holdings - which comes under your remit - to look again at the proposed 50 per cent increase in their rentals as of January 2012, given that they only have a week in which to sign up to it or their leases are terminated?

Senator B.I. Le Marquand:

I think in principle that we should be moving towards commercial rentals in relation to tenants of publicly-owned bodies. There is no question about that. But if you are suddenly springing massive increases on individuals in the way suggested by the Connétable of St. John, that causes tremendous problems. It seems to me there ought to be more sensitivity in dealing with such matters.

6. Senator F. du H. Le Gresley:

The candidate has continuously voted for G.S.T. (Goods and Services Tax) exemptions. Would he bring a proposition to change the current system?

Senator B.I. Le Marquand:

I have dealt with that in reality in my speech when I made it clear that I would not bring propositions for changes in tax structures without the approval of the majority of the Council of Ministers. It seems to be that it is very important that the Minister for Treasury and Resources operates in accordance with the policy, not of his own views, but also of his colleagues.

7. Connétable J.M. Refault of St. Peter :

As the Minister for Treasury and Resources is the States' nominated shareholder for the States of Jersey Development Company, would the Senator please share his views with us on the development of the Esplanade Square?

Senator B.I. Le Marquand:

My view is that it is going to have to be looked at again. The financial position has very clearly changed since the initial plans. I can see scope for individual developments of office blocks as and when they might be required, but the whole grandiose scheme, I am afraid, is just not going to happen in the originally intended form. My view is that it needs to be looked at again.

8. Connétable D.J. Murphy of Grouville :

The proposal is at the moment that £40 million should be provided to assist telecoms with their new fibre optic cable systems. Would it be the Senator's intention to continue with this or would he not be very keen on it?

Senator B.I. Le Marquand:

As I think I said in my speech, I am generally supportive of the scheme. This seems to be our best option, frankly, in terms of high value and low footprint diversification. The methodology chosen by which there would be a loan from, as it were, one States fund to a States-owned body does seem to be suitable but I have not seen a detailed business case. I would want to see that first.

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

Would the candidate give us his take on the current interaction between minimum wage income support and income tax thresholds?

Senator B.I. Le Marquand:

Clearly, with the minimum wage being set at the level it is, people are not in normal hours going to be earning sufficient not to also need assistance in relation to that. But this is a very complicated issue because of the problems of particular industries which repeatedly say that they could not function effectively with higher levels. The States has chosen to take advice in relation to the level of the minimum wage from an outside body and I approve of that approach. I support the current approach. I am afraid I cannot immediately see the connection between the other things but I can see the connection between the first 2.

10. Deputy R.J. Rondel of St. Helier :

My question has in fact been partly asked by Senator Le Gresley but just for the experience I will ask what I have written down if that is all right. [Laughter] No one likes to pay income tax or social security contributions but the majority understand that they are means of raising money and accept they have to contribute. What, in my view, the majority do not accept is the fact we have to pay a 5 per cent tax on a basic commodity such as food in a moral tax that has led to a hugely bitter feeling against the previous Assembly in part.

The Deputy Bailiff :

Can you bring it to a question, please?

Deputy R.J. Rondel:

What, if anything, would the candidate propose to do about the present 5 per cent tax on food? Thank you.

Senator B.I. Le Marquand:

I share the view of Deputy Rondel that the majority public view is in favour of food exemptions and exemptions on fuel and so on, but I think I have already answered the question that my view is it is not a matter for one Minister alone; it is a matter for the Council of Ministers; set policy and then bring proposals to the States.

[10:00]

11. Senator P.M. Bailhache :

Would the candidate confirm that he has read the recent report of the Corporate Services Scrutiny Panel on C.S.R. (Comprehensive Spending Review) and would he explain his vision for the future of the public service?

Senator B.I. Le Marquand:

Yes, I can confirm that I have read that and enjoyed it very much, in particular some of the appendices [Laughter] to it which were written by outside experts. I think I have to a degree set out my vision in terms of the need for fundamental review and fundamental change. But the reason why I am so keen on that is, frankly, very simply this: that I am keen to improve if we can our levels of public services, particularly our level of social services. It is that desire on my part which is the motivation to ensure that the public sector is made increasingly efficient so we can deliver more, or at least continue to deliver the same, without getting into a cycle of ever-increasing taxes.

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

The candidate made much play of his numeracy and statistical skills, I wonder if the candidate could outline what he considers to be the other skills required to the job and could he rate himself on a scale of one to 10, 10 being most excellent. [Laughter]

Senator B.I. Le Marquand:

The trouble I have with the last part of that is I always tend to underrate myself [Laughter] so I am likely to give myself a 7. [Interruption] I would like to give myself a 7 where others would give me a 9. I think that it is very important that the Minister for Treasury and Resources works collaboratively. It is extremely important that he work co-operatively with the Chief Minister because if the 2 are not working in tandem at the heart of the Council of Ministers, we are going to have chaos. Absolutely fundamental; that is the number 1 issue. But I think the range of skills required are those which I hope I possess. Apart from the arithmetical stuff, the ability to analyse things, the eye for detail, which I am afraid sometimes irritates Members in the Assembly when I will pick on some picky point, but that is a very good characteristic, I think, in a Minister for Treasury and Resources. There will also inevitably to a degree be some sort of international role, although I believe that that lies fundamentally with the Chief Minister and with the Minister for E.D. (Economic Development). The range covered by the current Minister for Treasury and Resources, as indeed Sir Philip himself said, was far too wide and I am certainly not going to be trying to be "all jobs for all men".

13. Deputy S. Power of St. Brelade :

How would the candidate propose to work with his colleagues in Environment and Housing in accelerating the provision of affordable housing in the eligibility gateway of between £250,000 and £300,000? Does he feel that the Treasury Department should get back into a States Loan scheme?

Senator B.I. Le Marquand:

I think there certainly is a case looking at a States Loan type scheme. I was around in the 1970s, a conveyancing clerk as an advocate, when that was in its heyday. It basically was phased-out because cheap money became available and it was not necessary. But as I highlighted in a speech recently, we have now gone back into a situation in which the level of deposits being required is much higher and therefore people are struggling to get on the ladder at all. So I think that is certainly a matter that will need to be reviewed but there may well be other options as well.

Deputy S. Power:

The candidate did not answer the question. I asked about his eligibility in gateway and about his relationship ..

The Deputy Bailiff :

You will be able to express that later on if you wish through the vote. Deputy Lewis .

14. Deputy K.C. Lewis of St. Saviour :

A question that bridges the old Ministry and possibly the new; as we are in need of a new police headquarters, where would the candidate site this and how would it be funded?

Senator B.I. Le Marquand:

I have of course been on the working party that has been working on this which has come to the conclusion that the site on the open area of the car park in Green Street is a suitable site. I agree that that is so and the funding has already been voted by the States of Jersey within its financial planning.

15. Connétable J. Gallichan of St. Mary :

It goes with the territory that the successful candidate will need to make many difficult decisions which will not necessarily be popular with the public. Does the candidate agree with me that in the past the reasons behind the decisions have not always been adequately communicated to the general public and what steps will he take to ensure that he can carry the public with him in future?

Senator B.I. Le Marquand:

I think it is terrifically important to put out more information to the public. I have commented that I do not think there has been sufficient information going out as to the reasons behind things in this particular area. One of the abilities which I think I have is the ability to take quite complex things and to explain them relatively simply. Some people think I have the gift in the reverse order as well [Laughter] but I do believe I have that when I focus my mind on it. I hope to be more successful in communicating the issues but the key starting point is we must know where we are in terms of long-term planning. Absolutely fundamental.

16. Connétable D.W. Mezbourian of St. Lawrence :

I do not think I heard the candidate address this during his speech, but what are his views on the States of Jersey borrowing money?

Senator B.I. Le Marquand:

I am generally against it unless it can be done in the context where there is a clear income stream which is going to pay back the thing. I favour, as I have said, trying to utilise our existing pots of money in terms of funds more creatively first before we would consider that.

17. Deputy T.M. Pitman of St. Helier :

If the Senator is elected, will he have a more open-minded approach to a possible use of the Rainy Day' fund as in perhaps kick-starting necessary projects like the access to Fort Regent?

Senator B.I. Le Marquand:

I think it is important to maintain the size of the current Strategic Reserve; I think that is very important. We have an economy which is very much focused in one particular industry - the finance industry - although that itself is diverse. We must have provision if there is a major downturn in that area. But as I said already, I am looking to find other means within the States resources of funding necessary things but that has to be in a way that is self-financing.

18. Senator A.J.H. Maclean:

I am sure that a future Minister for Economic Development would have been very pleased to hear that the candidate suggested he would be more creative in the use of reserves. What I would like to know from the candidate is how confident he is that the C.S.R. target of £65 million will be achieved and, if not, what he would seek to do to address the matter?

Senator B.I. Le Marquand:

There is a shortfall clearly in the current planning which is substantially because of the decision of the States of Jersey in relation to some of the proposals of the Minister for Education, Sport and Culture. There is no doubt that there is a shortfall. There are no current plans to fill that shortfall and that will have to be a decision of the next Council of Ministers. The fundamental intention behind the programme was of course to reach a balanced budget by 2014 but this will not just be a decision for me; it will be for the whole Council of Ministers.

19. Deputy K.L. Moore of St. Peter :

The candidate mentioned his concerns of the European Union Finance Ministers' view of our deemed distribution system. What does the candidate propose to do if those Ministers decide against our current system as it stands?

Senator B.I. Le Marquand:

I had slight difficulty hearing the Deputy but I think that was a question: do I have a Plan B if Ecofin turn down the current Zero/Ten? At this moment in time, no I do not, and I do not think anybody has. That would be a very serious situation and we would have to completely review our policies. There are other potential ways forward but those would have to be carefully evaluated.

20. Deputy S. Pitman of St. Helier :

Recently the President of the Chamber of Commerce commented on the BBC Radio Jersey and he asked that G.S.T. is not raised again as its effect ..

The Deputy Bailiff :

Very well, I now ask Senator Le Marquand to go with the Assistant Greffier who will accompany him to a room in the building where he will not meet the other 3 candidates. The Greffe staff is scattered in protective mode all over the building and I will ask that Deputy Le Fondré be invited into the Assembly.

Deputy C.F. Labey of Grouville :

While we are waiting, might I ask for a list in which order the Chief Minister is going to propose the Ministers?

The Deputy Bailiff :

Yes, indeed, Deputy . It should be on Members' desks but when I opened the proceedings this morning I did ask the Chief Minister designate if he would read the declaration. Perhaps while we are waiting for Deputy Le Fondré to come, if he wishes to do so (it should be on Members' desks) that the declaration be made. It is not?

Senator I.J. Gorst :

Sorry, Sir, I do not seem to have that with me. I am quite willing, however, to inform Members that the order that I put forward to the Greffier on Wednesday morning is the order that I intend to take them at this point. Firstly, as is now underway, Treasury and Resources; secondly, Social Security; thirdly, Housing; fourthly, Education Sport and Culture; fifthly, Economic Development; sixthly, Home Affairs; seventh, Planning and Environment, eighth, Health and Social Services and, ninth, Transport and Technical Services. However, I should, as Members know, reserve the right to change those in the course of the day should that become necessary, but I will keep Members informed.

The Deputy Bailiff :

So that I know what you are doing, can I please have my note back? [Laughter] Very well, Greffier, start the clock. Deputy Le Fondré.

2. Deputy J.A.N. Le Fondré of St. Lawrence :

Can we start the clock when I start speaking please, Sir, if possible. I look around me today and I remember feelings I had 6 years ago. It is worrying to think it was that long ago I was first sitting in this seat. It was very much a mixture of pride and enthusiasm and honour but also trepidation in having so swiftly to appoint the team that would guide the Island through the next 3 years. What did I really know about each of the Ministerial candidates, their relevant skills and their experience? How could we see beyond the rhetoric and the presentation, the P.R. (public relations) if you like, to the skills and the substance of the individual? Let me start by telling you what my professional background is. I am a chartered accountant - that may be good or bad. I qualified with Ernst and Young and worked for them in Jersey and then in Luxembourg before moving back to the local Jersey practice in 1997. Together with the new Chief Minister Designate, Deputy Noel and Deputy Young I am, I believe, one of only 4 qualified accountants in this Assembly. My client experience has included small local businesses, international banks, computer audit of parts of the States of Jersey oddly enough, trust companies, forensic accounting, as well as dealing with high value clients.

[10:15]

In my view, it is critical that the Minister for Treasury and Resources is someone with a professional and qualified financial background. I know from my experience in Treasury that many of the issues facing the Minister are technical and a clear understanding of those matters is essential. You need someone who can recognise what good looks like when it comes to financial matters. Most people will agree that we have very challenging times ahead, not least because of the volatile situation in the worldwide economy. International pressure, the issues surrounding the fulfilment industry, the huge problems concerning States infrastructure, including the hospital, pensions and how we deal with our ageing population. Facing these and other challenges will need very careful, calm and reasoned decision-making. It is true that we enjoy a healthy level of financial reserves, however given the legacy issues of decades of failing to maintain our infrastructure and the need to rebuild some of the reserves that we have already used we must continue to plan for tougher times ahead. What are the functions of and what should Members require from a Minister for Treasury and Resources? Some are obviously defined under law to ensure that the public finances of this Island are regulated, controlled and supervised. It is about assessing financial viability, facilitating projects, which have economic, social or financial benefit. It is being clear about future cost implications. Investments, budgets and public expenditure are all part of the remit and the Minister for Treasury and Resources must be prepared to work as part of a team with fellow Ministers and States Members. But I would also echo the words of Senator Bailhache last Monday, the role of the Minister for Treasury and Resources has to be a lot more focused for the next 3 years. All of these duties clearly require someone who is respectful of the authority of this Assembly and who is also respected by this Assembly. Personal integrity is of fundamental importance, as is the ability to look to the medium and long term in making decisions. I am not a person who entertains short-term political fixes. I believe the challenges that we face are too important for that type of approach. I have spent 5 years in Treasury as an Assistant Minister. Indeed I was sometimes also referred to as the "Minister for Property", having had the full delegated authority for all property matters. In that role I made more decisions than some Ministers. As Assistant Minister I was also involved in the post-implementation of Zero/Ten, most particularly of aspects of G.S.T. and also directly with the production of 4 budgets. I know the teams involved and I believe I have a very good and trusting working relationship with them. As a brief example of my approach, substance and delivery if you like, is the new dairy at Howard Davis Farm. Under my direction I brought forward to this Assembly 3 changes to the law, which amended the existing covenant. This allowed the new dairy to be constructed, Acorn Industries and the Jersey Society for the Prevention of Cruelty to Animals (J.S.P.C.A.) to have new facilities and, as well, the creation of a living trust which serves the original intentions of one of Jersey's most generous benefactors, T.B. Davis. That may sound very straightforward but that project required 3 years very careful negotiations with many disparate parties, particularly descendents of T.B. Davis, both here and in Cape Town. It required some parties to radically change their stance but all of them came on board, and its success was a very significant step in securing the viability of the dairy and therefore of our precious dairy industry. During my time at J.P.H. (Jersey Property Holdings) we achieved many successes, most of which passed under the radar. We delivered £400,000 worth of annual savings just in the re-tendering of maintenance contracts and £11-12million in property disposals, which is a figure that was bang on target. To give some wider examples, I brought - which is always a slightly embarrassing expression - the so-called "Le Fondré proposals" to this Assembly back in 2008. We used our existing systems to distribute monies and target them appropriately rather than to clock-up, in my view, greater bureaucratic costs by exempting food from G.S.T. That was supported by 34 votes to 6. As chairman of the Legislation Advisory Panel we unlocked the 10-year block that was discriminating against illegitimate children as regards

inheritance law, and the reason that all of us this year were elected on a single day was because of my proposition back in 2009 to have all elections in any one year on the same day. That was the foundation and it was supported 47 votes to nil. I believe I have demonstrated in a whole wide range of areas that I can unravel complex situations and take them forward. On other occasions I have proposed - I will call them creative I suppose - simple solutions, and that does require a careful mix of financial, political, personal, and technical skills at times. What is the overall direction that you could expect if I become Minister for Treasury and Resources? In the past 3 years we have again put up taxes and the public will, in my view, rightly require that we are robust in ensuring that services are delivered with greater efficiency. I believe we, on this Island, are well past the point whereby our financial future can be secured through annual rounds of budget cuts. I am talking about true business transformation. That is my passion and, yes, even accountants can be passionate at times, and that is the approach which I will pursue as Minister for Treasury and Resources. Root and branch reform is required to deliver more for less cost' through taking a truly fresh approach as to how we do things in the public sector, and that is looking at what we do, how we do it and could we do it differently. It is about challenging and changing the silo mentality which currently separates departments, and that was what was held out to us some 2½ years ago as part of the C.S.R. process. It is by far the best way of achieving sustainable, structural savings, but it simply has not happened other than as an exception, and that needs to be delivered. There are organisations both here and away from this Island who have significant experience of this and who are achieving impressive results, and I visited a leading benchmark organisation in the U.K. (United Kingdom) last year and I strongly believe that that is the way forward for Jersey. The people I met would be delighted to come here and share their experiences. They have embedded politicians at the heart of the process rather than just looking at the top down. That is something I really want to see here. I believe I have the necessary skills and knowledge for this role. I am a qualified chartered accountant with real practical experience, both here and abroad. I can draw my 5 years in Treasury and J.P.H. and in my time in the Chief Minister's Department. I have made tough decisions and I have been prepared at times to stick my head above the parapet where circumstances have demanded. I have demonstrated, I believe, that I act with honesty and integrity and I do have experience of working with and pulling teams together. Even under extreme pressure my approach is one of careful, calm and reasoned deliberation, independent thinking and a

determination to get things right. Leadership is about having the moral fibre to do the right thing. It is about resisting pressure to do the wrong thing and it is about recognising that if you make a mistake admit it, and bring in the correct remedy. I hope I have given new and returning Members a better insight of who I am, I suppose possibly to paraphrase the Dean on Monday, and I believe I demonstrated why I believe I have the personal, professional and technical capabilities to offer a fresh and open approach to the role of Minister for Treasury and Resources. I hope Members will consider me when they are voting.

The Deputy Bailiff :

For the benefit of members of the public in the gallery who saw Senator Ferguson passing £10 to the Greffier, this is not customary practice but [Laughter] reflects that a fine is imposed for her telephone going off. Question time for Deputy Le Fondré now opens. I call on Deputy Power.

1. Deputy S. Power:

How would the candidate propose to work with the Minister for Environment and the Minister for Housing in accelerating the provision of affordable housing using the £250,000 to £300,000 gateway and does he believe the States should bring back a States Loan scheme?

Deputy J.A.N. Le Fondré:

To answer the last part of the question first, I would be I think in principle very supportive of bringing something like the States Loan Scheme back. I suspect it would have to be revitalised into modern times. This is always caveated .. any question on Treasury has to be caveated by how the money works. But as a principle I always liked the idea of the old States Loan Scheme and I think it would be a good idea to bring it back in some shape or form. In terms of the gateway or perhaps how one works with Environment and Housing in terms of affordable housing - let us put it that way round rather than getting into the gateway principle - as Deputy Power knows both he and I were quite concerned about the H3 policy when it was originally generated in the Island Plan and indeed a number of us, including myself, brought amendments to that and in fact I will say mine was probably the closest to being accepted by the Minister for Planning and Environment. Where we are now? We have a working party on that policy that is part of the whole principle of obtaining money in some shape or form to deliver part of affordable housing going forward. We are working and I think the Deputy knows part of my style, it is about working and working groups and bringing people together.

2. Deputy R.G. Le Hérissier:

The candidate read out a list of commendable projects in which he was involved. Could he tell the House where he feels he has made mistakes and what has he learned from those mistakes?

Deputy J.A.N. Le Fondré:

That is quite an interesting question; where have I made mistakes? I think part of the frustration I have felt is that we have had projects we wanted to bring forward and for whatever reason they have been delayed from outside the department - let us put it that way round - and so from that perspective that is one of the reasons that I was very keen to put my name forward for Minister for Treasury and Resources this time round, because I want to be in the position of if there are barriers being put in place to try and overcome them. In terms of how to deal with mistakes some of them we know, sometimes we started off from a different perspective. We have recognised that. I believe we have spoken to people and brought people in. It is about recognising them and amending things if they need amending.

3. The Connétable of St. John :

Given the candidate has experience with Jersey Property Holdings, in recent weeks the commercial tenants of the States have been forwarded correspondence that they are going to have a 50 per cent rent increase, and they have to reply to that correspondence to the department within 7 days, either accepting or otherwise. If elected, would the candidate review the decision that has been made and put a structured system in place so we do not have these huge increases at a time when the Island is in difficulty and require these businesses to operate sensibly and not for the Island to be doing this type of scenario?

Deputy J.A.N. Le Fondré:

Is it possible to seek a point of clarification from the questioner at all? I just wondered if the questioner could clarify when he says "commercial tenants" is this across the board or in one particular spectrum?

The Connétable of St. John :

These are tenants which are currently within Harbours and they are told that Property Holdings ..

The Deputy Bailiff : Harbours will do, Deputy .

Deputy J.A.N. Le Fondré:

I am quite surprised at a 50 per cent increase and that is why, in my time certainly when we were looking at rents, and looking at the rent per square foot, including the Harbours areas, I know there was a push to try and get people on to a consistent level and at my time there my understanding was that they were broadly speaking there. So there must be a circumstance that I am unaware of, so certainly absolutely no problem in an undertaking to review it and I do take the point, I would not wish to commit without knowing the information. Obviously if there is a problem there and one needs to look at it, if there is justification for it; for example, perhaps somebody might have been getting a peppercorn rent for a long time, there have been negotiations, and finally they resolve them. If not it would seem to make sense to have some form of staggered system coming through but obviously it very much depends on the circumstances.

4. Senator P.M. Bailhache :

Would the candidate confirm that he has read the recent Corporate Services Scrutiny Panel report on C.S.R. and would he explain his vision for the future of the public service?

Deputy J.A.N. Le Fondré:

I definitely did read the C.S.R. report because, if the Senator realises, my name is on the back of it as part of the committee, as vice-chairman of the Corporate Services Scrutiny Panel. [Laughter] The vision is .. we do have a decision to make. Interestingly enough, there was a very interesting speech given by the Comptroller and Auditor General about the conflicts we had between .. that does happen.

[10:30]

The Comptroller and Auditor General can give a decent speech at times. It is about the conflict we have between a low tax jurisdiction and potentially increasing our expenditure all the time and delivery of public services. That is why we are seeing the problems we are having. Expenditure is going up, revenue is crossing over. In terms of the vision, my preference is very much to see and this is why we are talking about the business transformation. Business transformation is not just about reviewing terms and conditions. It is not just about salami-slicing 10 per cent off the budget all the time or 2 per cent, or whatever it is. It is about looking very closely at how you provide the services. It is saying: "Can we do things in a different way?" That is not necessarily about cutting the service and some of it is if you get it right you can put more money into the actual delivery at the customer end of the service. There are a lot of thought processes about that. It is about.. I will not even go into the hearings we have had with John Seddon and all that type of stuff. My preference is to make sure that the public themselves believe that we have done that root and branch review, that we are providing the services that they want us to provide, and we are dealing with it in as efficient way as possible. If we can demonstrate that and then there is still the justifiable demand for further services then that is a different issue. My stance is I think we need to do that first piece of work. That is what was held out as part of the C.S.R. process at the beginning and has not happened properly yet.

5. The Connétable of St. Mary :

The candidate expressed the view that he felt he had the leadership skills, the moral fibre to do the right thing. He will appreciate that this is not always popular with the public. Does he agree with me that in the past the reasons for difficult decisions have not been well communicated to the general public and what steps will he take to ensure that in future he is able to take the public with him on these big decisions wherever possible?

Deputy J.A.N. Le Fondré:

I did not quite hear the very middle bit of that. Would I agree with the Connétable that ..?

The Connétable of St. Mary :

That in the past the reasonings behind difficult decisions has not always been adequately communicated to the general public.

Deputy J.A.N. Le Fondré:

I think if that is in terms of decisions I have been involved in or wider decisions within Treasury because in the wider decisions within Treasury I think there have been times that I have felt that communication should be a lot better. That is why I would hope when certain projects have been involved and Members would certainly appreciate that we start at the bottom in terms of we have started speaking to the Ministers to say this is what we want to do, we then started pulling in the Assistant Ministers, we then started pulling in the Scrutiny members and to expand it out. The intention would have been then to make sure there is a proper communication programme in place before going out to the public before we started doing things, and that is certainly I agree entirely. Communication is key. If you look at Canada, when they looked at the expenditure stuff, the whole point was getting the public on board and understanding the message first. Absolutely important.

6. Senator F. du H. Le Gresley:

What is the candidate's opinion on the role of the States of Jersey Development Company in developing publicly-owned assets?

Deputy J.A.N. Le Fondré:

There are a number of issues on the S.o.J.D.C. (States of Jersey Development Company) in terms of the principles, i.e. the principles of having an arm's length development company for which we receive the profits of the development. I think that is fine. In terms of what I think is key within that lot, my understanding that the way this was always held out to Members is that we would take a project, a development site; we as the States or the Planning Department or the Regeneration Steering Group will define what was going to happen on that project to the extent that ultimately you would be going to S.o.J.D.C. with probably a site for planning permission with the specifications with the delivery contract, therefore you are then in a position to say: "Here you go, go away and do it." That is where I think there is clarity and you are then able to hold S.o.J.D.C. to account in terms of delivery because within S.o.J.D.C. - certainly I am not too sure where it is going to go forward - my understanding is that bonuses and things like that were based on the profits of that company. So it is very clear we need to see performance in that and so you need transparency and arm's length that is effectively treating it as if you have got another developer, you just have to own them. You have got to make sure you deal with them properly. In terms of using S.o.J.D.C. as the principles, absolutely happy with it, but I want to make sure there is absolute transparency and accountability, if you like - terrible jargon - between us and that entity.

7. Deputy G.P. Southern :

I would prefer a short answer, rather than a long one. How does the candidate propose to fund the capital spend on such issues as the hospital and housing infrastructure over the next few years?

Deputy J.A.N. Le Fondré:

There is a short answer and a long answer. Just to give an idea, the big decision on the hospital is do you build new or do you refurbish. The numbers are in the order of £200 million to £300 million. The housing transformation programme: my understanding is they are looking in the order of £200 million; something along those lines. So you are talking very, very big numbers. In terms of what I can say, if you are looking at the other infrastructure matters - I hope that is the Attorney General going to be paying a fine - in terms of looking of at some of the infrastructure numbers there is ..

Deputy G.P. Southern :

The question is how do you fund it?

Deputy J.A.N. Le Fondré:

I am just getting to that. In terms of the lesser infrastructure problems within the wider estate you can do it by shrinking the estate and you can use the funds that come out of disposal to put back into the estate. In terms of the big numbers, I think you are looking at there having to be some form of separate financing package.

Senator S.C. Ferguson:

The question has already been answered, Sir.

8. Deputy S. Pitman:

Recently the president of the Chamber Commerce commented on BBC Radio Jersey asking it that G.S.T. is not raised again as its affect on itself and its effect on inflation - which was 1.3 per cent, latest figures - has pushed small businesses more overboard. What are the Deputy 's views on this? The Deputy has disagreed in the past with the rise of 5 per cent G.S.T. ..

The Deputy Bailiff :

One question, Deputy , thank you.

Deputy S. Pitman:

How will he tackle inflation?

Deputy J.A.N. Le Fondré:

I did not quite catch the last part of that.

The Deputy Bailiff :

Can I say to Members, there is one question per Member please. You can have another question later on.

Deputy J.A.N. Le Fondré:

In which case, shall I deal with the ..

The Deputy Bailiff :

You can deal with the first question.

Deputy J.A.N. Le Fondré:

It is known that I did not support the timing of the increase in G.S.T. and fundamentally my position was I felt we needed to be demonstrating the savings first. That was a democratic decision by the Assembly and I think we have all moved on. In terms of future increases in G.S.T., my stance is I would not wish to see any substantial increases or any new taxes in the foreseeable future. The only caveat I would say is obviously the impact of the H3 land development tax/property tax area will also need to be looked at. I do not think I answered the question properly.

9. The Deputy of Trinity :

Part of the question has been answered about the new hospital or refurbishment, but also will need significant investment in actual services as we go forward to 2014. How will the candidate plan to raise the funds necessary?

Deputy J.A.N. Le Fondré:

I am assuming at that point that the question is in relation to significant revenue increases in the budget rather than capital problems. My understanding is that Health was getting a real term increase in its budget but obviously it had then to take account of the C.S.R. Again, I think initially wherever we go, we have to go and look at the services we provide in terms of can we provide it in a different way. Obviously there is a lot of talk about - I do not like the terminology the "third sector" - the third sector in charity and family nursing and all that type of stuff. I am not a health expert in any shape or form. I am a numbers person. We know, for example, that there are areas in Health that Health do not need to do, and the Minister will know, for example, that the Health does not need to operate nursing accommodation itself. For example, as a piece of work that my department did it would be possibly a £1 million benefit a year on revenue, which would assist. I suspect that is a drop in the ocean. We need to look at those areas first. Then I suspect, to be honest, we are going to be in the position we were in in Education, for the previous decade, where we have injected money into that.

10. Deputy T.M. Pitman:

Since the Deputy was ejected from the Executive and came back to the light, so to speak, he surely noticed that the previous incumbent at Treasury appeared to approach the House as if it was an afterthought - the £100 note fiasco being a good example. What assurances can the Deputy give that if elected he will adopt a different approach that might take more Members and the public with him?

Deputy J.A.N. Le Fondré:

I would hope my track record. In fact I think if the Deputy speaks to the Deputy next door to him on his right, that she would hopefully confirm that when we have had significant projects we have involved as many people as possible; and that is certainly my case in terms of communication and working on things.

11. Deputy J.A. Martin:

I am sorry to disappoint the Deputy . My question is, when he was - probably too strong a word to use "shafted" - but dismissed then from his post by the present Minister for Treasury and Resources, why did he not bring a vote of no confidence so we could have all had the discussion, the transparency and the leadership that this candidate is promising on the floor of this House over the Lime Grove House fiasco? Why did he not do it then and why has he promised he can do it in the future?

Deputy J.A.N. Le Fondré:

There are 2 things about the timing of that. Number one, the Lime Grove House fiasco as referred to; the project only collapsed in August and I was very keen on that project. It would have delivered £1 million savings a year, it would have avoided about £8 million in capital spend over the next 10 years and it would have been the first stage of the delivery of the office strategy. To say I was disappointed to see it fail at that stage is putting it as an understatement. There was a lot of time - about 2 years of work - that went into that project, at least, and many months of departmental time, officer time and political time. The point was, at that point, in January, when I was no longer there, I wanted to see that project succeed and I did not want to endanger it. Is that the end of the question or is that ..

The Deputy Bailiff :

No, you have 2 minutes more, so be precise.

Deputy J.A.N. Le Fondré:

That was not the time, and it was about the style and the substance and all that type of thing. I try not to do personal things at all. It is all about facts and matters, and there is always a judgment call there as well. What I would say is that the matter is under review by the Comptroller and Auditor General. I think really we have to see what the outcome of that review is and that is why I do not particularly want to be drawn on it too much at this stage.

12. The Connétable of St. Lawrence :

In his opening remarks the candidate said: "We must plan for tougher times ahead." What is his plan and how would he deliver it, in 30 seconds?

Deputy J.A.N. Le Fondré:

It cannot be delivered in 30 seconds. The point is it goes back to this whole thing about business transformation. We have done the short-term fixes, if you like - it has been hard - of producing the roughly £65 million off, but we have been here before. If you go back to the original undertakings in 2005 about the savings that were going to be made, when we looked at them they had either been spent or some of the savings were not.. They were increases in income. So that is what I am saying. It is going to take slightly longer. You need to dig down and you need to look at the services we provide. That has to be the starting point. If you do that you come out lean at some point. Doing that process will set us up properly for going forward.

13. The Deputy of Grouville :

Very, very quickly then. The candidate has highlighted that there are services that Government ought not to be involved with. How will he go about making these changes and when?

Deputy J.A.N. Le Fondré: It is about being able to ..

The Deputy Bailiff :

Deputy Le Fondré, can I ask you please to go with the Assistant Greffier who will escort you to another part of the building and the Greffier will ask Senator Breckon to be brought to the Chamber. The usher is currently circulating the Chief Minister's Designate's declaration made yesterday which sets out the proposed order of nominations for 9 Ministerial offices, although as he has mentioned earlier, he has the ability to vary that list during the appointments process if any of his candidates are not selected. Attorney General, to fill in the time while Senator Breckon is coming here, I think I noted that your telephone went off.

[10:45]

Mr. T.J. Le Cocq Q.C., H.M. Attorney General:

No, Sir, in fact it was the States of Jersey official computer that pinged, but nonetheless it is appropriate I accept full responsibility for it and I have already discharged the financial obligation.

The Deputy Bailiff :

With any luck, it may go off again and [Laughter] charity will benefit as a result. Senator Breckon, have you had a chance to catch your breath? You are ready to go, then I call on you to address the Assembly.

3. Senator A. Breckon:

Just for the benefit of the House, I did send out a paper to Members a couple of days ago. I will refer to that, albeit briefly. But I want to begin by looking at the bigger picture. By the bigger picture I do not mean the offices that are proposed on the Waterfront. But to say the least, I think the world is experiencing some financial turbulence and this is due to no fault of ours really. It is due to toxic loans, bank bail outs, sovereign debt and more recently problems in the Eurozone. Of course Jersey will, and indeed has, felt the effect of many of these things but I believe we need to be positive and we have already done that. We have some reserves and we have taken action. I say we have taken action because in 2002 Jersey agreed to commit to co-operation regarding sharing of tax information with the Organisation for Economic Co-operation and Development, the O.E. C.D ., and that has been a benefit and has led to the signing more recently of quite a few tax exchange agreements. But I think we also need to keep doing positive things because we have shown a degree of co-operation and transparency. We have increased Jersey's standing as an international finance centre and we have developed, and we are developing, our own personality internationally, and I think that needs to be built upon. Having said that, we need to be aware that others are still envious of our position. They are looking at what we do on the one hand, and on the other they are seeking to copy what is best. They are also seeking to attack and the recent news about the low