The headline 'Adapt or Die' over the article on Ben Shenton's views was sufficiently alarmist to cast doubt on the integrity of what he was reported to be saying, but I was even more concerned when I read the details.He appears to say that the solution to the Island's problems lies in public sector pay, which must be reduced. I fail to see why he targets the public sector employees in this way, as they are in no way responsible for the current recession nor even for the 40% spending rises. In the period from 2005 to 2009, inflation has risen by 16%, and average earnings in the public sector have risen by 22% - the same as the average earnings in the private sector.
If we go back to the beginning of this economic cycle in 2002, the cost of living has risen by 31%. In this period average earnings in the public sector have risen by 33% and in the private sector by 38%. In 2009, due to the pay freeze, average earnings in the public sector have again fallen behind the private sector. So bringing public sector pay into line with private sector pay would involve a pay rise for most public sector workers. For example there is at least one private school in Jersey that pays its teachers 5% more than those in States' schools.
The 40% rise in spending mentioned by Senator Shenton may be due such projects as the incinerator, and the mismanagement demonstrated by senior officers but pay levels are not the cause of overspends. It seems that in any economic difficulties the public sector is targeted. When the economy overheats these employees are asked to show restraint. In times of recession, when they could help to boost the economy if their spending power were to be maintained they suffer a pay freeze. Let us not forget that these employees are not just faceless bureaucrats, but groups such as teachers, nurses, firefighters and paramedics who provide vital services.
Senator Shenton refers to the pensions 'black hole' but employees have paid contributions over their working lives and the employer's contributions have been part of their terms and conditions. These conditions and the job security that he also wishes to remove are part of what attracts well educated people into the public sector when they could earn more elsewhere. But these benefits are currently being eroded. For example, new entrants to the teaching profession will have much reduced pensions, and not until they are 65 rather than 60. As this is worse than is on offer in the UK we are likely to see further recruitment problems. There is currently a severe shortage of nurses due to the fact that the pay in Jersey is not high enough to compensate for the high cost of living.
Senator Shenton must know that Jersey is, contrary to the current spin, a low tax, low spend economy. Progressive taxation - not an increase in GST - could continue to deliver the services we have enjoyed up to now. Perhaps his emotive 'adapt or die' has some truth in it after all. Jersey must adapt to paying the appropriate rate for its services, or a cancer sufferer who has to wait for treatment because of a shortage of health professionals may well die.
Shades of things about to come Updated.
3 days ago