States of Jersey is warned to curb spending
- 21 October 2011
- From the section Jersey
Jersey's Fiscal Policy Panel is warning the States to curb spending as 90% of its savings pot has been used up.
A report from the panel said the States should plan on the basis of an even more fragile and drawn-out global recovery than previously expected.
It said the States should avoid making decisions that permanently reduce revenue or increase expenditure.
Three years ago, the Stabilisation Fund had more than £100m in it, but now it has £10m in it.
The account was set up to help Jersey's economy through the downturn and has paid for projects to keep people in work, such as roadworks on Victoria Avenue and training schemes for young people.
The Fiscal Policy Panel report looks at States finances taking into context recent global events, local economic developments, the 2012 Business Plan decisions and the draft 2012 Budget proposals.
It said the risks to public finances have increased since its last report in July and the States should focus on phased fiscal consolidation and financial stability in the medium term.
Fiscal Policy Panel Chairman Joly Dixon said: "With global economic prospects deteriorating we have revised down our economic forecast for next year.
"On this basis and with risks on the downside going forward, the States should be ready to support economic activity without weakening States' finances.
"For example, by bringing forward already funded capital projects or speeding up the planning process."