States Minutes 22nd July 2003

THE STATES assembled on Tuesday, 22nd July 2003 at 9.30 a.m. under

the Presidency of the Deputy Bailiff , Michael Cameron St.  John Birt, Esquire.

His Excellency the Lieutenant Governor,

Air Chief Marshal Sir John Cheshire, K.B.E., C.B., was present

All members were present with the exception of –

S e nator Jean Amy Le  Maistre – out of the Island

S e nator Philip Francis Cyril Ozouf – out of the Island

F r ancis Herbert Amy, Connétable of Grouville – ill

J o hn Baudains Germain, Connétable of St.  Martin – out of the Island

G e offrey William Fisher, Connétable of St.  Lawrence – out of the Island

D a vid Leon Crespel, Deputy of Trinity – out of the Island

G e rard Clifford Lemmens Baudains, Deputy of St.  Clement – out of the Island L y ndon John Farnham , Deputy of St.  Saviour – out of the Island

Prayers

Subordinate legislation tabled

The following enactments were laid before the States, namely –

Police Procedures and Criminal Evidence (Preparatory Hearings) Rules 2003. R&O 60/2003. Education (Discretionary Grants) (Amendment No. 2) (Jersey) Order 2003. R&O 61/2003. Conservation of Wildlife (Amendment No. 2) (Jersey) Order 2003. R&O 62/2003.

Matters presented

The following matters were presented to the States –

Waterfront Enterprise Board Limited: dissolution (P.33/2003) – comments. P.33/2003. Presented by the Policy and Resources Committee. Com.

Waterfront Enterprise Board Limited: dissolution (P.33/2003) – comments. P.33/2003. Presented by the Finance and Economics Committee. Com.(2)

Machinery of Government: establishment of Scrutiny Panels and Public Accounts P.79/2003 Committee (P.79/2003) – amendments (P.79/2003  Amd.) – comments. Amd.Com.(2) Presented by the Privileges and Procedures Committee.

Machinery of Government: establishment of Scrutiny Panels and Public Accounts P.79/2003 Amd. Committee (P.79/2003) – second amendment (P.79/2003 Amd.(2)) – comments. (2)Com(2) Presented by the Privileges and Procedures Committee.

Waterfront Enterprise Board Limited: provision of information by the Policy and P.105/2003. Resources Committee (P.106/2003) – comments. Com. Presented by the Policy and Resources Committee.

Jersey Police Authority: review. R.C.35/2003. Presented by the Home Affairs Committee.

Severe Emotional and Behavioural Difficulties Review 2002: report. R.C.36/2003. Presented by the Education, Sport and Culture Committee.

Overseas Aid Committee: annual report 2002. Presented by the Overseas Aid Committee.

THE STATES ordered that the said reports be printed and distributed.

Matters lodged

The following matters were lodged "au Greffe" –

States Auditors: further extension of contract. P.113/2003. Presented by the Finance and Economics Committee.

3 Edward Place, The Parade, St.  Helier: purchase. P.114/2003. Presented by the Health and Social Services Committee.

Arrangement of public business for the present meeting

THE STATES acceded to a request of Senator Stuart Syvret that the proposition regarding the Waterfront Enterprise Board Limited: provision of information by the Policy and Resources Committee (P.106/2003 lodged "au Greffe" on 8th July 2003) be not considered at the present meeting.

THE STATES rejected a proposition of Senator Edward Philip Vibert that the proposition regarding La Collette Fuel Farm, St.  Helier: lease to Shell U.K. Limited and Esso Petroleum Company Limited (P.60/2003 lodged"au Greffe" by the Harbours and Airport Committee on 13th May 2003) be not considered at the present meeting.

Arrangement of public business for the next meeting on 9th September 2003

THE STATES rejected a proposition of Senator Frank Harris on Walker that the Resource Plan 2004, yet to be lodged, be considered on 9th September 2003, and taken as the first item of public business.

Members present voted as follows –

"Pour" (22) Senators

Walker , Kinnard, Le  Sueur, Lakeman, Routier, M.   Vibert . Connétable s

St.  Ouen, St.  Saviour, St.  Brelade, St.  John, Trinity . Deputies

Huet(H),  Le  Main(H),  Dubras(L),  Le  Hérissier(S),  Fox(H),  Bridge(H),  Bernstein(B),  Ferguson(B) St.  Mary, Ryan(H), Hilton(H).

"Contre" (22)

Senators

Syvret, Norman, Le  Claire, E.   Vibert . Connétable s

St.  Mary, St.  Peter, St.  Clement. Deputies

Duhamel(S), Breckon(S), St.  Martin, St.  John, Dorey(H), Troy (B), Voisin(L), Scott   Warr en(S), Marti (H), Southern (H), St.  Ouen, Taylor (C), Grouville , St. Peter, De Faye(H).

There being an equality of votes the Deputy Bailiff , in accordance with convention, exercised his casting vote against the proposition.

THE STATES confirmed that the following matters lodged "au Greffe" would be considered at the next meeting on 9th September 2003 –

Social rented housing: policy on setting rents. P.29/2003. Lodged: 18th March 2003.

Deputy G.P. Southern of St. Helier.

Social rented housing: policy on setting rents (P.29/2003) – comments. P.29/2003. Presented: 29th April 2003. Com. Employment and Social Security Committee. (re-issue).

Social rented housing: policy on setting rents (P.29/2003) – comments. P.29/2003. Presented: 20th May 2003. Com.(2) Housing Committee.

Social rented housing: policy on setting rents (P.29/2003) – comments. P.29/2003. Presented: 20th May 2003. Com.(3) Finance and Economics Committee.

Draft Mental Health (Amendment) (Jersey) Law 200-. P.94/2003. Lodged: 1st July 2003.

Health and Social Services Committee.

Draft Public Library (Jersey) Regulations 200-. P.95/2003. Lodged: 8th July 2003.

Education, Sport and Culture Committee.

La Collette, St.  Helier: transfer of administration of roadway. P.96/2003. Lodged: 8th July 2003.

Environment and Public Services Committee.

Draft Agricultural Marketing (Amendment No.  7) (Jersey) Law 200-. P.107/2003. Lodged: 15th July 2003.

Economic Development Committee.

Draft Maincrop Potato Marketing Scheme (Revocation) (Jersey) Act 200-. P.108/2003.

Lodged: 15th July 2003.

Economic Development Committee.

Draft Fish Health (Amendment) (Jersey) Regulations 200-. P.111/2003. Lodged: 15th July 2003.

Economic Development Committee.

Bas du Mont Flats, Pier Road, St.  Helier: transfer of administration of land. P.112/2003. Lodged: 15th July 2003.

Environment and Public Services Committee.

Introduction of a PAYE taxation system – question and answer (Tape No. 837)

Senator  Edward  Philip   Vibert  asked  Senator  Terence  Augustine  Le  Sueur,  President  of  the  Finance  and Economics Committee, the following question –

" W  ould the President inform members whether the Committee intends to present to the Assembly its report and recommendations relative to the introduction of a Pay As You Earn' (PAYE) taxation system for Jersey, and if so, when it proposes to do so?"

The President of the Finance and Economics Committee replied as follows –

" A t this stage, the Committee will not be presenting a report on this matter to the Assembly. It has carefully considered  all  the  advantages  and  disadvantages  of  introducing  a  PAYE  system  of  tax  collection  for employees in Jersey and has decided that on balance a PAYE system based on the U.K. model would not be cost-effective in Jersey because of the significant staff and resource consequences for the Income Tax Office and for many employers, which appeared to outweigh any potential increased revenue.

I n the current climate of budget constraints, the Committee has decided that it would be quite inappropriate to

sanction the quite significant number of additional civil servants and additional expenditure that would be required at the Income Tax Office to administer such a system, unless there were compelling other reasons for doing so.

H  owever the issue is not concluded, and the Committee is examining the possibility of introducing a much

simpler and cost-effective tax deduction system for employees and a decision will be made later on this year as to whether or not to proceed with such a system. Additionally, my Committee has called for a report on the advantages and disadvantages of a possible combined collection process for both Income Tax and Social Security.

W  hen all these matters have been considered by the Committee, it may well view PAYE in a more favourable

light, and I shall report accordingly to members of the Assembly and the general public, with our final recommendations. Meanwhile I take the opportunity to thank publicly all those who contributed to our original consultation."

Publication of earnings of senior public servants – question and answer (Tape No. 837)

Senator Edward Philip Vibert asked Senator Frank Harris on Walker , President of the Policy and Resources Committee, the following question –

" W  ould the President inform members whether the Committee is prepared to publish annually the names of all public servants, including those of the judiciary, earning more than £50,000 per year and include in that list the salary, job title and a brief job description? If the answer is in the negative, would the President explain why not?"

The President of the Policy and Resources Committee replied as follows –

" T he Committee is indeed prepared to give members information on the salary levels of senior public servants, including those of the judiciary, and I am making a statement to this very effect today.

H  owever, the Committee is not prepared to disclose the personal salaries of individual officers. These are

negotiated on a personal basis and it is our belief that to do as requested would be to breach the individual contracts of employment we have with those officers. Therefore, we have decided to publish salaries in groupings, starting at £75,000 per annum. This will give members a good understanding of the salary levels paid to the senior officers, without breaching individual contracts.

M y statement will also refer to the range of officers whose gross employment costs exceed £50,000 per

annum.

S a laries for the senior posts, excluding the judicial and legal posts, are determined by the Hay Job Evaluation

system. This system evaluates and scores posts in terms of three broad criteria – knowledge, problem solving and accountability. Posts are then listed in order of points scores and salaries determined. Through this process we are able to compare posts both internally and externally, both within and outside Jersey, thereby establishing realistic internal and external salary relativities. Job descriptions exist for those posts which are subject to Hay evaluation, and the Senator is welcome to request copies of job descriptions from the States Human Resources Department."

Amy's House, La Route de Ste. Catherine, St. Martin – question and answer (Tape No. 836)

The Deputy of St.  Martin asked Deputy Terence John Le  Main of St.  Helier, President of the Housing Committe the following question –

( a ) In the Committee's proposition Amy's House, La Route de Ste.  Catherine, St.  Martin: proposed sal

(P.68/2003), it was stated that Amy's House was subsequently advertised again and two offers in the sum of £275,000 were received. Will the President confirm that Amy's House was advertised for sale at £285,000 and, in fact, an offer to purchase the property at the asking price was made.

( b ) If his answer is in the affirmative, will the President give his reasons why that fact was not made known

in the report accompanying P.68/2003 and why the offer of £285,000 was not accepted?

The President of the Housing Committee invited the Deputy of St. Ouen, member of the Housing Committee, to reply and he replied as follows –

" ( a) Amy's House was advertised for sale at £285,000 by estate agents, Vibert and Bridle. Including the initial tender process, the property had been advertised for sale from 17th October 2002 until 29th January 2003. Two offers were received for the property both at a figure of £275,000, one subject to survey and one not. The matter was considered by the Housing Committee on 14th February 2003. Subject to States approval, the Committee agreed to proceed with the sale of Amy's House to Mr. and Mrs. J. Bracken for the sum of £275,000, with the offer not being subject to survey.

T h e H  ousing Department was first advised on Friday 18th July 2003, by estate agents, Vibert and Bridle

that indeed, on 24th February 2003, some ten days after the Housing Committee agreed to sell Amy's House for £275,000, the Estate Agents received a letter of interest from a member of the public to purchase the property at the asking price of £285,000.

( b ) Neither the Housing Department nor the Department of Property Services were made aware of this

interest by the estate agents responsible for marketing Amy's House. In any event, the letter of interest was received after a decision had been made by the Housing Committee to sell the property. With no knowledge of the letter of interest, it could not be alluded to in the subsequent report accompanying P.68/2003."

Engagement of the community in the political process – question and answer (Tape No. 837)

Senator Edward Philip Vibert asked Senator Frank Harris on Walker , President of the Policy and Resources Committee, the following question –

( a ) Would the President confirm that when speaking at the recent Commonwealth Parliamentary Association

Regional Conference held in Westminster and Cambridge, he told the Conference that Jersey was making a real effort to engage the community more closely in the political process'?

( b ) Would he inform members what this real effort' involves and how it is manifested?

( c ) Would he also inform members what proposals he has put to the States to develop this concept during his

years in the Assembly and when he will, for instance, inform members if he has made a submission to the Legislation Committee to improve our electoral Law?

( d ) Are members to regard his statement as implying that the States have, in past years, failed to develop a

culture of engagement'?"

The President of the Policy and Resources Committee replied as follows –

" ( a) I am grateful to Senator Vibert for drawing attention to my speech; it was on a subject about which I feel very strongly. I was honoured to be invited by the Commonwealth Parliamentary Association to address their recent conference on the topic of Engaging the Community in the Political Process'. It is true that in my speech I did say that Jersey is making a real effort to engage the community and we intend to develop a culture of engagement', in which the community can, and will, feel much more involved in the political process.' I explained that a gap has opened between the States and the public. This is an unhealthy picture for democracy. Over the coming years we must address this otherwise we will not be able to ensure the Island is governed with the assent and support of the public. Every CPA member who attended my presentation reported similar problems.

( b ) In my speech I set out a number of actions which Committees and members have taken to try to engage

the public better. These included amongst others –

p a n e ls o f in terested people with real and precise terms of reference;

n u m e ro u s public meetings to discuss and consult upon specific issues and policies;

e m  ai l a n d c omputer discussion groups to promote debate;

o n - li n e s u r geries giving the public the opportunity to question States members directly; a d v i so r y b odies that make a clear contribution to the political process.

( c ) In asking this question it is clear that the Senator has misunderstood the content and thrust of my speech.

My speech was not about what I have done, or intend to do. I was speaking as a representative of the Island and my speech was related to what the States of Jersey have done and intends to do. I have not put any proposals to the States, or the Legislation Committee on this concept, nor do I have any intention of doing so. I believe that the measures taken by that Committee, and to which I referred in my speech, have already significantly improved the Electoral Law.

M e m  b ers will recall that at the briefing in May I outlined the process for developing the States Strategic Plan. This will include a proper process of public engagement during the autumn and beyond. We have

all accepted the need to develop a real sense of direction for the whole of the States and really involving the public in setting this direction is a very clear commitment to listening and responding to them.

Members will also recall that when I was President of Finance and Economics we launched the largest series of

public consultation processes inviting everyone to have their say on our future fiscal strategy. In terms of electoral turnout I can do no better than reiterate my speech.

W  e   a r e m oving the principal elections from the autumn to the spring in the hope that better weather will encourage voters to turn out at the poll stations we have extended polling station opening hours we have introduced much easier more widely available postal voting and we are making strenuous efforts to improve our voter registration procedures.'

( d ) I do believe that the States generally have not engaged with the public to the extent they should and, as I

said at the outset, a gap has opened up between the States and the public which is not healthy for democracy. I believe we must take firm action to try to close that gap and the Policy and Resources Committee is committed to taking a lead in this respect."

Appointment of a press officer – questions and answer (Tape No.837)

Senator Edward Philip Vibert asked Senator Terence Augustine Le Sueur, President of the Finance and Economics Committee, the following question –

" 1 . Would the President advise members whether the Committee has recently appointed a press officer? If the answer is in the affirmative, would the President advise the Assembly –

( a ) w hether this post was advertised, and if so, where it was advertised and how many candidates

applied?

( b )  w ho made the appointment?

( c )  o f the terms and conditions of the post?

 2  .  W  ould the President inform members whether the Committee was advised of and considered any

potential conflicts of interest that could arise in this appointment, given the professional background of the press officer appointed?"

The President of the Finance and Economics Committee replied as follows –

" I can advise members that the Finance and Economics Committee has not recently appointed a press officer. Question 1 parts (a), (b) and (c) and question 2 are therefore not appropriate.

H  owever, I would advise members that the Finance and Economics Committee does use the services of a

public relations firm in relation to communicating to the public its tax and spending policies, its Fiscal Strategy, and related matters.

W  hilst I regularly speak for the Committee in terms of press releases and answers to routine questions, (and

could thus be deemed its press officer'), and will continue to do so, I am not a communications expert. The Committee requires specialist advice on the best way in which to make what are very complex issues regarding the Island's tax and spending challenges more easily understood by the wider public.

T h ese fiscal issues, which are also inter-connected with the Fundamental Spending Review and the States

Strategic Plan, are of crucial importance to the future of the Island and need to be explained carefully and clearly to the public.

I t is for these reasons that the Committee has appointed, for a trial period ending in December 2003, a firm of

communications specialists.

T h e public relations firm used by the Committee was appointed following a competitive tendering process

and consideration of several submissions. The terms of its contract are necessarily confidential to the parties

concerned, particularly as there could be further competitive tendering should the requirement extend into 2004.

T h e Committee does not consider that the employment of this firm of communications advisers represents

any conflict of interest for the party concerned. The support has been conducted professionally and with integrity, and will I hope continue to be so."

12 mile fishing licence scheme by the Guernsey authorities – question and answer (Tape No. 836)

The Deputy of St. John asked Deputy Francis Gerald Voisin of St. Lawrence, President of the Economi Development Committee, the following question –

" I s the President aware of the negotiations taking place between the U.K. Government and the States of Guernsey regarding the proposed 12 mile fishing licence scheme being proposed by the Guernsey authorities, and which may penalise Jersey fishermen as the scheme will require a licence to fish in that area where currently a licence to fish is not required, and if so, would he give details of those involved in the negotiations?"

The President of the Economic Development Committee replied as follows –

" I am aware that the Bailiwick of Guernsey have kept the U.K. authorities informed of their intentions with regard to their planned licensing scheme in the waters around Guernsey while negotiating a Guernsey–U.K. Management Agreement. Those currently involved in negotiations with Guernsey are –

D e p u ty F.G. Voisin

D e p u ty M.A. Taylor

H . M . Attorney General W.J. Bailhache QC R .W  . Whitehead, Principal Legal Adviser S . B o ssy, Sea Fisheries Adviser

M . S m ith, Senior Fisheries Inspector."

12 mile fishing licence scheme by the Guernsey authorities – question and answer (Tape No. 837) The Deputy of St. John asked H.M. Attorney General, the following question –

" W ould the Attorney General –

( a ) advise members whether he has been asked to advise on the legality of the Guernsey fishing vessel

licensing scheme being proposed by the Guernsey authorities to a 12 mile zone from their coast which comes into effect on 1st October 2003? and

( b ) if so, and if the scheme is deemed to be legal, advise whether grandfather rights will be available to

existing Jersey fishermen?"

H.M. Attorney General replied as follows –

" ( a) Yes. I have had discussions with H.M. Procureur, my opposite number, in Guernsey at the request of the Economic Development Committee. However, I am not qualified in Guernsey and clearly cannot advise on matters of domestic Guernsey law.

( b ) The scheme  will be in force as of 1st October 2003. H.M. Procureur has advised that it is legal and that

presumably will remain the position unless it is successfully challenged in the Guernsey courts. The scheme does not provide expressly for grandfather rights but Guernsey is a signatory to the European

Convention for the Protection of Human Rights and it is possible that in the administration of the scheme, the

Guernsey Fisheries Authorities will, in appropriate cases, grant such rights to existing Jersey fishermen. The expression grandfather rights', in this context, is understood to be the right of a person currently in the industry to continue his business in the same way for the balance of his working life."

Rezoned sites under the Island Plan – question and answer (Tape No. 836)

Senator Edward Philip Vibert asked Deputy Maurice François Dubras of St. Lawrence, President of the Environment and Public Services Committee, the following question –

"( a) With regard to sites rezoned in the Island Plan for housing, especially in St. Clement, would the

President confirm all sites designated for housing will be a 50/50 mix of social rental/first time buyers as decided during the debate?

( b ) Would the President also confirm that the redevelopment on the rezoned site to the east of Jambart Lane,

St.  Clement will include the new road connecting with the Grande Route de St.  Clément as put forward as one of the main reasons for choosing that site?"

The President of the Environment and Public Services replied as follows –

" ( a) The mix of social rented and first time buyer homes on sites rezoned for housing in the 2002 Island Plan will be in accord with the decision of the States, as set out in Policy H1 of the Island Plan (attached at Appendix 1).

( b ) Yes.

A p p e ndix 1

P o li c y extract from the Jersey Island Plan 2002

POLICY H1 – PROVISION OF HOMES

T h e P  lanning and Environment Committee will make provision for sufficient land and opportunities to

meet the requirements for homes over the Plan period.

T h e P  lan allows for 2,860 homes to be built over the first five years of the Plan period of which 1,850

will be for Category  A homes and 1,010 will be for Category  B homes. Land will be rezoned to ensur that sufficient land is available to meet the requirements for Category  A homes in the first five years to 2006.

D e v e l opers of sites designated in the Plan specifically for the construction of Category  A housing in

Policy H2, will be required by the Planning and Environment Committee to provide first-time buyer homes and social rented homes in the respective proportions of 55% and 45% of the total number of dwellings provided on each site, in order to ensure that the identified needs for housing are met."

Recommendations of the Committee of Inquiry into the Allocation of Residential Property by Housing Trusts – question and answer (Tape No. 837)

Senator Edward Philip Vibert asked Deputy Terence John Le  Main, President of the Housing Committee, the following question –

" I n his answer to a question on 10th June 2003 regarding which of the 24 recommendations made by the Committee of Inquiry into the Allocation of Residential Property by Housing Trusts, the Housing Committee would be acting upon, the President stated that this report would be studied at the Committee' meeting on

24th June 2003 and that he would report back to the Assembly. Would the President now inform members which

of the 24 recommendations the Committee will be acting on?"

The President of the Housing Committee replied as follows –

" T he Housing Committee has agreed to act on all the recommendations put forward by the Committee of Inquiry."

Senator J.A. Le Maistre – attendance

Senator Jean Amy Le  Maistre, having returned to the Island, arrived in the Chamber during the above question put to the President of the Housing Committee.

Building programme in respect of the proposed Waterfront Hotel – question and answer (Tape No. 837)

Senator Paul  Vincent  Francis  Le  Claire  asked  Senator  Frank   Harris on   Walker ,  President  of the  Policy  and Resources Committee, the following question –

" I n answer to a question on 10th June 2003 regarding the Hotel on the Waterfront and when it could be expected that details of the building programme would be announced, the President replied that by the end of June, it is expected that final approval of the funding bank's Board will be achieved'.

A  s that date has now passed, would the President inform members of the reasons for the delay and what the

timetable is now?"

The President of the Policy and Resources Committee replied as follows –

" T  he terms of a bank offer for senior debt funding have been received by the hotel developer (Jersey Waterfront Hotel Developments Ltd). These terms have conditions attached which have necessitated the introduction of additional equity investment. This additional investment has been identified and agreement in principle has been reached with the additional, new investors. This agreement is now being documented. The funding conditions also require that a guaranteed maximum price for the building works be agreed between developer and builder before the Bank's final approval can be given. Commercial negotiations with the proposed builder have become challenging recently but a way forward has now been found and confirmation to the bank that a guaranteed maximum price can be secured is expected within 2 weeks. Work is still anticipated to start in the first quarter of 2004 subject to these issues being resolved as planned."

States financial borrowing and the Strategic Reserve – question and answer (Tape No.837)

Senator Edward Philip Vibert asked Senator Terence Augustine Le Sueur, President of the Finance and Economics Committee, the following question –

" ( a) Would the President inform members of the total amount of off balance-sheet borrowing' , that is capital expenditure not funded by a Capital Vote or from Trading Fund Balances – either external funding or internal funding – to which Jersey is currently committed?

( b ) Would the President supply details of each loan giving members –

(i )  th e purpose of the loan, the date it was taken out, the balance owing, the total amount of the loan and

the interest being charged?

(i i) th e source of the funds for each loan?

(c ) Would the President advise the Assembly what the Committee's policy is on off balance sheet

borrowing'?

( d ) Would the President inform members of the current amount held in the Strategic Reserve (the rainy day

fund'), and the projected return this year?"

The President of the Finance and Economics Committee replied as follows –

" ( a) The States of Jersey does not have any material off balance-sheet borrowing'. This is because all material loan or financing arrangements between the States of Jersey and third parties are disclosed in the Audited Accounts of the Treasurer of the States as at 31st December 2002 and I would direct members to Note 20, page xxxvi of those Accounts which discloses finance lease capital commitments outstanding as 31st December 2002 of £35.5 million. As such, all of the States of Jersey's financing is on-balance-sheet'.

O f t h is £35.5 million finance lease commitments identified in the Accounts:£1.7 million is funded from

the Capital Fund, £1.1 million will be funded by the now incorporated Jersey Telecom Group Limited, £21.4 million is funded by the Harbours and Airport Committee and£7.4 million will be funded through General Funds through rentals charged to Committee cash limits. £3.9 million, in respect of Maritime House, will be funded through a combination of rentals charged to cash limits and to the Harbours and Airport Committee

I n a d d ition to the above, there exists a small number of internal financing arrangements which were

initially funded from cash balances and which will be repaid through Committee cash limits. These arrangements amounted to £4 million (Jubilee Wharf, La Collette Bus Garage, Les Quennevais Dance Studio) as at 31st December 2002.

F u rt h e rmore, the Housing Development Fund advances sums for the development of social rented or first

time buyer property, which are repaid through the sale of these properties to first time buyers or to Housing Trusts, through rentals achieved from completed developments or through allocations to the Fund provided through the Capital Fund. The balance of properties that are awaiting transfer to Housing Trust or are in the administration of the Housing Committee amounted to £35,679,896 as at 31st December 2002.

W  h il s t not amounting to borrowing, as disclosed in note 19 page xxxv of the Financial Report and

Accounts 2002, the States have provided guarantees up to a maximum of £20.2 million as at 31st December 2002 to financial institutions in respect of the borrowings of Jersey New Waterworks Company Limited and up to a maximum of £5.5 million in respect of the borrowings of Jersey Arts Trust in connection with the renovation of the Opera House.

W  h il s t also not amounting to borrowing the Housing and Finance and Economics Committees have

agreed to provide financial support to various Housing Trusts in respect of their bank loans entered into in connection with the Trusts' development of social rented housing. The Finance and Economics Committee issues letters of comfort' to the banks in respect of such loans. These letters of comfort do not constitute guarantees. As at 31st December 2002, letters of comfort, in respect of loans totalling £80.3 million were in issue.

( b ) As the question asked, specifically excludes financings funded from the Capital Fund or Trading Funds,

I have excluded all such arrangements from my answer to this question, including the Housing Development Fund. I have also excluded finance arrangements entered into by departments for minor items such as photocopiers, etc.

M at e r ial external' loan or lease financing funded other than through the Capital Fund, Trading Funds and that now assumed by Jersey Telecom Group Limited amounts to one lease and leaseback arrangement, approved by the States on 16th April 1996 to fund Morier House. The balance of the

capital outstanding at 31st December 2002 and the original capital sum borrowed on that arrangement amounted to £7,360,738, interest charged to the Accounts for 2002 amounted to £636,467, and the interest rate applicable is 6 %. The arrangement is between the States and RBSI and is being repaid through rentals paid by departments occupying that building through relevant Cash Limits.

In  ternal Funding

T h e  f o llowing internal financing arrangements currently exist –

1 . J u bilee Wharf

T h is is an arrangement, funded from internal cash balances to provide office accommodation for the

Housing Department. The original loan of £2.5million, which was drawn down in 2000 and bears interest at the Kleinwort Benson 1 month fixed plus one percent, will be repaid from the Housing Committee's Cash Limit over 20 years, replacing rentals that used to be paid to third parties. This arrangement was agreed by the States (September 2000).

2 . L a Collette Bus Garage

   T h is is an arrangement, funded from internal cash balances, to provide a Bus Garage at La Collette.

The original loan of £2  million, which was drawn down in 2002 bears interest at the Kleinwort Benson one month fixed plus one percent, is being repaid from the Bus Operator's rental payments (£180,000 pa initially) over 20 years. This arrangement was agreed by the States (P.61/2002).

3 .  L e s Quennevais Dance Studio

T h i s i s an arrangement, funded from internal cash balances, to provide a Dance Studio at Les

Quennevais Sports Centre. The original loan of £300,000, which was drawn down in 2001 and bears interest at 6%, is being repaid from extra income arising from the use of the Studio over 5  years. This arrangement was agreed by the Finance and Economics Committee (may also have been the States, if drawings were presented).

( c ) I refer the Senator to the stance of the Finance and Economics Committee as recorded in the Resource

Plan 2002, and I quote from page  13 of that document:

T h e Finance and Economics Committee recognises the possibility of funding projects outside the Capital Fund, through the use of private finance. This will normally, however, only be considered where a new funding stream, which meets the cost of financing, can be put in place. This income must be permanent and not adversely impact on the overall States' financial position.'

(d )  The  market  value  of  the  investments  held  by  the  Strategic  Reserve  as  at  30th  June  2003  was

£391.8  million.

      I t is not possible to predict the return for the Reserve for 2003 as this will depend on movements in Bond

and Equity Markets and changes in interest rates which are factors outside the Finance and Economics Committee's control.

Connex bus service – questions and answer (Tape No. 837)

Senator  Edward  Philip   Vibert  asked   Deputy  Maurice  François  Dubras  of  St.  Lawrence,  President  of  the Environment and Public Services Committee, the following question –

" 1 . Would the President inform members –

(a ) o f the fare revenue taken by Connex for the month of June 2003?

(b ) w hether he is yet in a position to inform members of the projected size of the loss incurred and how

much extra this is going to cost the taxpayer than the budgeted £1.4  million?

2 .  In its report of the operation for six months of the Connex Bus Company the States were informed that

during the period covered by the report a total of 1,039,511 passengers were carried which produced a total revenue of £807,615. This was an average fare of 78p. In view of the fact that the fare structure is 80p, 100p, 125p, 155p, would the President explain this very low figure?"

The President of the Environment and Public Services Committee replied as follows –

" 1 . (a) R evenue is not reported in calendar month format but in the industry standard of thirteen, four weekly periods. The most appropriate period therefore is from 8th June to 6th July 2003. The accurate figure will be available on 26th July; however preliminary indications are that the revenue for that period will be of the order of £230,000.

(b ) A lthough not clear what is meant by loss incurred, I have been tracking the operational results so

far. Only once the full operating year's results are received and audited can the figure be provided accurately, in our next six-monthly report due in November, and the full amount of subsidy determined.  Based  on  current  trends  and  projections,  which  is  always  a  risky  procedure,  it appears to me that the fare revenue is likely to be lower than the original 2002 estimate.

2 .  S implistic calculation of averages is not sound statistical practice and results in misleading information.

The revenue detailed in the report was collected from fare-paying passengers. The passenger total, however,  includes  181,842  passengers  who  benefited  from  free  travel  given  to  holders  of  Health Insurance Exemption passes and Pensioner passes. The Senator will also recall that the child fare is a flat rate 50p. Allowing for the combined effect of the above, the adult average fare for this period is almost £1.

It is o ur intention to provide more detailed passenger and revenue statistical information in our Annual

Report for the twelve month period, 2002-2003."

Salaries paid to senior officers – statement

The President of the Policy and Resources Committee made a statement in the following terms –

" S enior Salaries

T h e Policy and Resources Committee has been reviewing the issue of the disclosure of salaries paid to senior

officers employed in the States of Jersey. We firmly believe that the public and States members have the right to know the levels of remuneration of senior public employees. We have therefore decided that each year the Committee will publish a table of salary groupings. Table 1 attached shows the figures for June, 2003. I should point out that these are salary figures, they do not include employer pension and social security contributions which in general are worth 21.66% of salary.

T h e salaries of the senior officers are negotiated on the basis of regular reviews of external comparability and

internal relativity. The interval at which such reviews are carried out is normally every four years. These reviews help my Committee determine what adjustments, if any, need to be made, given changes that may have taken place between reviews. In the intervening years between reviews salary increases paid to senior officers normally are considered in the light of negotiated increases elsewhere in the public service.

O  ther Salaries

I n  the local press recently, there was much criticism of the fact that some 10% of States employees earn of

the order of £50,000 plus. The suggestion was made that no other local business could afford to pay 10% of its staff at these salary levels.

I s hould like to comment on this. The people of Jersey have the right to expect the States to employ a good

quality professional workforce, most of whom are not pen-pushers' (the description used by the Press). We have to pay salaries which are in line with, and follow, the market for people like officers, medics, teachers and other professionals. I have therefore decided to publish a much fuller analysis of the types of staff whose salary is more than approximately £41,000 per annum. I believe this will allow people to make their own judgements. Table 2 shows this analysis.

I w  ould like to emphasise the following –

( i)  the salary groupings quoted in the Financial Report and Accounts for 2002 for staff were inclusive of the

employer's pension and social security contributions, and any additional payments to some staff for extra hours commitments over and above contractual requirements. Therefore the figures quoted are for employees whose pay is more than approximately £41,000, this equates to the £50,000 figure quoted;

( ii ) the States of Jersey cannot be compared with any other single local business. It comprises a range of

businesses' which in many cases employ a variety of specialists and professional staff, many of whom do not have counterparts in the private sector. Examples of the professional specialists employed are the following –

H e a d T e a ch e rs, Deputy Head Teachers, Hospital Consultants, Doctors, professions supplementary

to medicine, nursing sisters, Probation Officers, Social Workers, senior Police Officers, senior Prison Officers, scientists, engineers, accountants, planners, lawyers, Air Traffic Controllers etc. These form a significant proportion of those in States employment whose salary is more than £41,000 per annum.

P u blic Sector Performance

W  hilst on the subject of staff employed by the States I and my Committee have been concerned by the

growing practice of States members to denigrate public employees in this Assembly and through the media. This is having an adverse effect on the morale of the Public Service and the ability of the Service to recruit and retain competent staff. We believe that all staff are accountable for their performance and no one should be allowed to deliver anything less than good performance, but general unsubstantiated criticism of staff hampers rather than improves performance.