Budget is ‘on track’ – Teare

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TREASURY chiefs were questioned on their growth forecast, the work of the island’s Brussels representative and even the future of the £1 note before a Tynwald scrutiny committee.

Treasury Minister Eddie Teare MHK and chief financial officer Mark Shimmin gave evidence at the latest sitting of the Economic Policy Review Committee.

In the Budget, a four-year programme to rebalance the public finances in the wake of the VAT bombshell was announced.

It assumed government incoms would grow by 6 per cent, a figure which Treasury officials insisted at the time was realistic.

They said the programme had the flexibility that, should growth forecasts not be achieved, no additional calls on reserves would be required.

When asked how the figures were faring in relation to the target, Mr Teare said: ‘Initial indications are that we are on track.

‘There will be some uncertainty I understand because of the difficulties in Europe which weren’t anticipated at the time we drew up the Budget.’

In response to a question from committee chairman Leonard Singer (Ramsey MHK) Mr Teare said the appointment of Patrick Bourke as the island’s first director of European affairs and Brussels representative provided value for money.

Opportunities

His role is to improve mutual understanding and recognition, address any challenges emanating from Europe, take advantage of potential business opportunities and participate in the development of EU policy.

‘We can learn about things much earlier than if we hadn’t had him there,’ the Minister said.

He said Mr Bourke was ‘doing a good job’ and was an ‘asset to the Treasury’.

When asked what the benefits Mr Bourke was bringing to the island, Mr Shimmin said: ‘You’re asking for benefits which are of a qualitative and subjective nature.

‘It’s about more than simply having lots of meetings which might have taken place.

‘It’s the value that comes from them.’

When asked about the future of £1 notes, Mr Teare acknowledged that some retailers preferred £1 coins. But he said the Treasury had no plans to phase them out.

Mr Shimmin said that the issue of £1 notes was ‘more an identity issue than a pure commercial one’.

The island has signed some 30 tax information and exchange agreements (TIEAs) and double taxation agreements with other countries. Mr Teare said two more TIEAs had been approved in principle and there was another one ‘on the way’.

He said Treasury’s policy was to focus in OECD countries first.

When asked how the island compared with other countries in terms of its international agreements, Mr Shimmin said: ‘I think we are well respected as a country which not only talks a good game but also delivers an effective way of dealing with other countries.’

The committee was also made up of Dudley Butt MLC and Howard Quayle MHK.

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