Mediaboss Marketing

by Mariel Norton

The Isle of Man Government’s Treasury Minister has provided an in-depth presentation of the 2012 Manx budget to representatives of the Island’s financial services industry, at a packed breakfast briefing hosted by Lloyds TSB Offshore.

The event was held at the Claremont Hotel on the morning of Friday 24th February and was extremely well attended, building upon the significant reputation that the Lloyds breakfast briefings have developed as a valuable source of information and access to decision makers.  The Hon Eddie Teare MHK, Minister for the Treasury, walked attendees through the state of the Manx economy and expanded upon some of the changes made in the latest budget and the reasoning behind them, before taking questions from the audience.

The Minister’s view of the economy was cautiously positive.  He made it clear that the plan to balance the budget by the 2015/16 tax year was based upon forecasts of Government revenue which he felt were very reliable, and which were in turn based upon an economic growth forecast of around 3% per annum.  Mr Teare also emphasised the fact that the renegotiation of the VAT agreement had now left the Island with an appropriate and steady income, which actually had the benefit of making forward planning easier than it had been under the previous arrangement.  He concluded by saying: “The easiest thing for any government to do is to put taxes up, rather than to address its own spending.  We want to do the hard work; we want to get our costs down.”

When questions were put to the audience, the mood was generally positive, with many congratulating the Minister on a sensible budget before asking their question.  One area of contention related to figures shown by the Minister which suggested that public sector pay was on average 14% higher that pay in the private sector.  This was addressed by one attendee, alongside the issue of ‘gold plated’ final salary pension schemes.  The Minister’s response was that immediate change to the pension scheme to funded arrangements was not feasible, but that a further review would be necessary in the medium term, and that the public sector pay figures were distorted by the number of high-end professionals on the Government’s payroll compared to the private sector.

Questions were also asked regarding the continued ‘subsidy’ of the construction industry from the capital expenditure fund.  To this the Minister replied that construction was one of the first to be hit by the recession but was also likely to be one of the first to recover, with a number of large private developments currently in planning.  As such, the current Government investment in bricks and mortar was a ‘bridging’ operation, intended to ensure that skilled staff were not lost to the UK in the interim.

Trevor Kirk, Head of Corporate Banking at Lloyds TSB Isle of Man, represented the hosts of the event.  He commented: “I am very thankful for the Minister taking time out of what must be a really hectic schedule in budget week to present to all of our clients and introducers.  I am also very pleased that so many were able to make it along, and hope that they found it as informative as I did.  It is certainly encouraging, and a great benefit of our jurisdiction, that we can have access to such a key decision maker – even to the extent of being able to ask questions and provide direct feedback.  As a bank dedicated to keeping our clients informed as part of our service offering, we are proud that we are able to facilitate these opportunities.”
 
-ENDS-

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Treasury Minister Briefs Business Leaders