AllinsonThank you Mr. President   

I will be supporting the Treasury Minister’s first Budget to this Honourable Court. 

As the Treasury Minister mentioned in his opening introduction, the island has seen unprecedented disruption over the past three years that has led to significant uncertainly and financial pressures that has been felt right across all sectors of our economy, which has meant that many businesses across the island have had to learn to adjust and adapt to the challenges as a direct result of Covid-19. 

In addition, over the past year we have found ourselves in a cost of living crises that has seen a general increase in everyday costs that has put additional pressure on many businesses, but in particular general household costs, especially in respect of the utilities that use and the food that we buy each week. 

As the Treasury outlined in his budget pack, the impact of these significant prices raises over the past 12 months have be felt disproportionally by those on low income, but these increases relating in fuel, inflation, transport, food and housing have been felt right across our community.   

I thank Treasury Minister for his positive statement on FERSA (Final Expenditure Revenue Sharing Arrangement) this morning, which will ensure a stable and secure basis of agreement between the UK and Isle of Man from the    joint revenue pools from VAT duties under the 1979 Customs & Excise Agreement. 

We don’t have to look too far into our past to remember when the Isle of Man was receiving sums exceeding £408 million in 2008/09. 

Upon review of that particular agreement, the island’s share of the joint pool was reduced to £296 million in 2012/13 and since then the Isle of Man has slowly recovered its financial position, so I do not criticise the Treasury Minister and his team when I describe this budget as a steady budget or a cautious budget or for even setting growth levels at 3%. 

And although the level of welfare increases being applied in certain areas over the last three years has frustrated me on behalf of my Constituents in Onchan, I cannot fault Treasury for their prudent financial stance when you consider all the relevant financial data and information. 

That said, it would wrong of me if I did not take the opportunity to highlight some serious concerns being raised by Manx Charities such as Housing Matters, who recently announced that around 200 people using their services over the last 12 months had “no fixed abode”. 

A homeless shelter run by Graih was also used more than 534 times in the last year by 59 different people. 

Both of these charities are calling on this Government to make a firm commitment to help some of the most vulnerable in our society, and I repeat that message again here today. 

Mr President 

The Treasury Minister in his introduction says that the previous budgets of this administration sought to bring as much relief as he can to the “Family Heartbeat” of our society, and again this budget ticks many of those boxes but what about the most vulnerable in our society and those individuals that are alone or simply do not have the safe family environment to call upon when things go wrong? 

If we are to truly have the inclusive and caring society that the Treasury Minister is calling for in this budget, then we need to put in place the financial resources, support and facilities for when someone is facing a difficult “life event” such as mental or physical health problems, eviction, unemployment, a breakdown of a relationship or simply because parents, family or friends are no longer willing to accommodate those individuals, which triggers them being potentially homeless or with no fixed abode. 

Mr President, as the Treasury Minister has outlined in his opening speech, this is the fourth year of a five year financial plan to return the Government’s finances to a sustainable position. 

I have therefore reviewed this budget over that period, and there are certainly elements that should be applauded and I thank the Treasury Minister, his Political team and Officers for supporting hard working families and low to middle income earners once again this year, especially through raising Personal Tax Allowance by a further £250 in this particular budget, which will lift an additional 465 people out of the tax system. 

Personal Tax Allowances under this administration has increased from £10,500 to £14,250 and therefore removed thousands of hard working and low to middle earners out of the tax system all together.

It is hard to imagine that personal tax allowance on the Isle of Man was just £9,500 towards the end of the last administration. 

I would also like to thank Treasury officers for preparing the comparison tables as part of our budget packs, which gives Tynwald Members a very clear understanding on the calculations and the potential funds going back into the pockets of hard working families and low to middle income earners. 

Staying with tax for a moment, Mr. President.     

The Treasury Minister also announced this morning that from the 2020/21 tax year, individuals can choose a tax cap for either 5 or 10 years, and that the maximum income tax liability for an individuals will be increased to £200,000 and £400,00 for jointly assessed couples. 

As I highlighted in previous budget speeches, the number of tax cappers on the Isle of Man has reduced significantly since 2008. 

This is further evidenced by the Isle of Man Housing Market review report for 2018 that shows a sharp decline in the sale of property valued above £1 million, and it will be interesting to see if that trend continues when the next housing report is published in May this year. 

With the uncertainty of Brexit and with the UK now going through a transition period, the Isle of Man has the perfect opportunity to encourage more High Net Worth Individuals or Tax Cappers to our island. 

Alternatively, we should at least be ensuring that our tax cap scheme is linked around genuine Manx businesses or towards to the creation of long term employment or development opportunities that actually benefit the Manx Economy directly or indirectly. 

As a Member of the Department for Enterprise I have already seen several great examples over the last three years of High Net Worth Individuals or Tax Cappers coming to our island, and then investing heavily in property, employment and our community, but I feel much more could be achieved if the Treasury Minister would look again at the scheme ahead of the 2021/22 budget. 

In respect of the National Insurance Account, I thank the Treasury Minister also for increasing the Upper Earnings Limits from 1st April 2020, which will certainly benefit thousands of employed and self-employed workers across our island. 

I will also be supporting the Motion on the Order Paper to increase the percentages from the National Insurance Account as part of the National Health Service allocation, but I do have to question if a 0.1% (point one percent) increase is sufficient, especially when the Net Expenditure of our Health Service has increased by around £36 million over the past four or five years, and if I use the probable figure for 2019/20 then we can add a further £10 million on to that figure. 

If we look at the actual expenditure for the Department of Health and Social Care in 2018/19 along with the probable figure for 2019/20 and the budget figure for 2020/21, then we can expect to see the Health Minister to be standing up in this Court in January or February next year asking for a further Supplementary Vote for a sum not less than £4 million.  

Mr. President – the sooner we create a financially and clinically sustainable health and care system on our island the better…

We also have less than 18 months to encourage people to take greater responsibility for their own Health, to deliver more care in the Community, improve Hospital Care and to protect the most Vulnerable in our Society as outlined in the Programme for Government. 

The island’s health service and the public sector pension remain two of the biggest financial challenges facing this Government and future governments of this island – not forgetting the Government’s commitment for Achieving Net Zero Emissions by 2050, which will require significant investment, both public and private, along with trying to change the hearts and minds of 84,000 people of this island over the next 30 years. 

The previous Treasury Minister stood in this Court in February 2016 to announce that Public Sector Employee Pension Reserves would be depleted by 2020/21, so it is excellent news that the current Treasury Minister and his team are now forecasting that those funds will not actually be depleted until part way through 2022/23. 

We must use that valuable time wisely and to take the opportunity to address some of the historical financial concerns involving our health service. 

I also thank the Treasury Minister for setting a clear policy around a blanket uplift of 2% for Department income targets to reflect the impact of inflation and/or growth, which gives a very clear and transparent statement to the Manx people. 

It is unfortunate that under appendix 9 of the Pink Budget Book, the Department for Infrastructure has yet again not provided details on the proposed charges or uplifts for Highway Services for the next financial year. 

I hope the DOI Minister will confirm here today that those charges will not increase by any more than 2% as per the policy, in order to avoid the situation we faced last year when the Minister announced a 30% increase in school bus fares – again hitting hard working families. 

Just looking more widely at the Manx Economy, Mr. President. 

In the latest Business Confidence Survey dated December 2019 by the Economic Affairs Division, over three-quarters of employers on the Isle of Man surveyed felt it was easy to do business on our island. 

So retaining the island’s current corporation tax rates continues to show a level of commitment by this Government to support businesses across our island, especially when we are so proud to host some of the world’s leading E-Business, E-Gaming, Manufacturing, Shipping, Finance and Bio-Med sectors, which in turn creates new skills, employment opportunities and apprenticeships not just for today‘s workforce, but also for tomorrow’s. 

Our Manufacturing and Construction sectors are continuing to show signs of increased production and activity, but concerns around the shortage of labour, training and skills needs to be addressed as matter of urgency. However, I remain a loyal supporter of the island’s immigration and work permit systems to protect Isle of Man workers.    

The number of registered unemployed on the island has been historically low throughout this administration, but serious concerns remain on the long term unemployment bands. 

In September 2016 at the start of this administration, 25% of the registered long term unemployed for 12 months or longer were over the age of 55 and a further 16% were under the age of 24. 

Unfortunately, the latest Labour Market Report issued in December 2019 now shows that more than 40% of our long term unemployed are over the age of 55 and 25% are under the age of 24 – and I seriously have to question why, given the current unemployment levels on the Isle of Man. 

The Department for Education, Sport and Culture continues to offer excellent apprenticeships & vocational training opportunities, which are currently attracting 460 apprenticeships and over 1,261 vocational training opportunities over the last 12 months, but the evidence appears to show that we are starting to leave our over 50’s behind, especially for those looking for further employment opportunities…..      

If we are to focus on increasing our working population, then we will have to create those opportunities for people to learn new skills and to obtain qualifications that are relevant to our economic success in the future, along with work place experience or apprenticeships, but more importantly the ability to retrain, and retrain again throughout their careers – commonly known as Life Long Learning Opportunities….

With the Government having already set the direction to increase the island’s State Pension Age to 66, 67 and then to 68 over the next 25 years, then we have to create those new skills, qualifications and training opportunities for the entire Manx workforce, and to ensure that age and a lack of skills and training opportunities do not become barriers in future.  

Mr President – I would to like to finish with a few comments around my own political responsibilities for Motorsport and Tourism. 

I thank the Treasury Minister and his team personally for recognising the financial pressures that the DfE Motorsport team are facing when trying deliver these key events that encouraged more than 46,000 visitors to our island during the TT in 2019, along with a further 16,000 to the Classic TT, Manx Grand Prix and the Southern 100 events. 

The overall spend during these events exceeded £50 million, Contributions to the National Income was around £36 million and with an Exchequer Benefit totalling more than £6.6 million in 2019, along with the Department’s own spend supporting many local businesses across our island. 

The team have also secured income totalling more £3.1 million, which goes directly back into these key events. 

This is in addition to the Manx Rallies and the many other Motorsport events that we also support throughout the year. 

Our Service Sector, which includes tourism accommodation, catering and entertainment, has also seen a sharp increase in confidence over the last two years, but we have so much more to do. 

Competition for the tourism pound from destinations abroad and the UK is fiercer than ever, and the Isle of Man Visit Agency was established to encourage all vital stakeholders to work together for the overall benefit of the visitor economy. 

The Isle of Man will need to work even harder to maintain its position and to realise new opportunities to grow its share of the tourism market and to extend our season beyond April and September, and this can only achieved with the full support of the Treasury, especially when we look to review the quality of our hotels and accommodation stock over the next few years, along with attracting more non weather dependent events during the shoulder season. 

The Isle of Man Destination Plan 2016 to 2020 also encouraged us to be bold and to take direct intervention and diversification into new markets, and our successful MIF (Marketing Initiative Fund) through Treasury over the past two years has enabled us to share our Extraordinary Story, our Clans, our UNESCO Biosphere status and other successful campaigns though tv, media and social media platforms. 

The new £38 million capital investment at the Prince’s Half-Tide Dock in Liverpool for a new Manx ferry terminal, due to be completed in 2021, along with the £25 million redevelopment of the Douglas Promenade will play a major part in the island’s tourism sector in the future. 

The Department and the Visit Isle of Man Agency will be publishing its strategic plan to 2023 later on this month, which will outline our ambition, vision and our core aims to work in partnership with all stakeholders and to deliver an exceptional visitor experience over the next three years. 

In closing, Mr President, I thank the Treasury Minister and his team for delivering a fair and balanced budget, but I do ask the Minister to look more closely at some of the welfare and support payment levels being allocated to some of the most vulnerable within our society in his final Budget of this administration. 

Thank you, Mr. President.