Paying for the LoveIOM gift card – which encourages people to spend in the local economy – to be distributed cost the taxpayer around £100 for each one.
LoveIOM is a Department for Enterprise initiative that rewards consumers for spending in local hospitality businesses and was brought out to ultimately stimulate the island’s economy.
More than 1,770 LoveIOM gift cards were sold to the public between their release in September 2021 and April 2022. To fund this, it cost taxpayers around £180,000 altogether to pay the companies which distributed the cards.
These included main supplier KBH Limited for contracted services, which received £171,349.98, and 16 other suppliers, claiming the other £8,911.71.
However, customers’ funds credited to gift cards between September 1, 2021, and April 8, 2022, amounted to £66,782.
Government incentive during this same period added £12,692 of value, so the total amount of money credited to gift cards equalled £79,474 – less than half of the cost to taxpayers.
The information was revealed as part of a Freedom of Information request.
It said that the DfE appointed KBH Limited to deliver the service following an open procurement exercise, which it is still undertaking.
The department was tasked to develop a platform which could support an ‘incentivised solution’ to encourage on-island spending to support the Manx economy.
According to the DfE, KBH’s platform offered the ‘flexibility to incentivise spending in different ways at different times, as well as adaptability for the department to develop the solution for future initiatives as it sees fit’.
The project stemmed from the Economic Recovery Group in 2021 and was to provide a platform for a number of years to have ‘flexible options’, should the need arise.
It was also required to deliver marketing services for a period of six months from launch.
Enterprise Minister Alex Allinson previously said the card was ‘a trial’ and that its progress would be closely monitored as the government would take on feedback from a number of sectors so it can develop the card for the future.
When the card was first released, the Isle of Man Examiner spoke to Just Pizza and Pasta owner Mitch Sorbie who complained that the government-backed initiative was a ‘waste of time’.
The restaurateur refused to sign up to the scheme, calling it ‘stupid’.
‘We were never consulted about it,’ he said at the time. ‘I think that some bureaucrat somewhere has just decided this is going to happen.
‘They should have come to the industry and talked to us.’
It was in contradiction of a report published by accountancy firm PwC for the hospitality sector last year which detailed solutions for the industry during winter particularly.
The government tried to discredit the report, according to Mr Sorbie, and didn’t take on board any of its recommendations.
He said last year: ‘I find it astonishing we have a government that’s paid for a report and then just thrown it to the corner, it’s disgusting.
‘They should have looked at the report to see what the recommendations are, not come up with this stupid card.’
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