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Thursday, 7 June 2012

The States of Jersey is dead in the water

Wake up, wake up. The banking system is collapsing - American Banks, British Banks, German Banks, Spanish Banks, Greek Banks... how can you not see it in the face of all the evidence which is in front of you?

But I hear you say, what does this all mean for ME?

To understand just how bad it is let's look at the economics of the States of Jersey.

In 2011 the States of Jersey spent approximately £600 million pounds, quite a tidy sum but where did it all come from?

Over 50% of it came from taxes on Private Banks, yes the very ones which are now going bankrupt, it seems likely that this income will fall substantially... the Jersey branches may remain 'profitable' but any profit is easily removed from the scope of Jersey taxation by a simple 'management charge' to a head office overseas which will have more than enough loss to mean that no taxation arises, anywhere.

The banks owe the States of Jersey nothing and the cost of doing business in Jersey as a result of the high level of regulation means that the financial companies are more than willing to move elsewhere.

So the States of Jersey's income falls by around 50% to £300 million. Just enough money to pay the wages and salaries of the Civil Servants, but not enough to provide ANY of the services...

There is of course the Social Security fund which was valued at £1.3 billion (enough with additional collections to see us through the next ten years or so) but with the collapse of the Stock and Bond Markets and eventually the value of paper currencies this may not last half that long.

The States of Jersey have known that this is happening for THREE years but have not taken ANY steps whatsoever to lessen their expenditure nor to lessen their future liabilities, they have therefore chose to make what they can before the end, to look after themselves at the expense of the people they are supposed to represent.

Write now to your States member now and ask what plans they have made when the States of Jersey is no longer able to meet its financial obligations!