Nov 13 – GSLP-Libs Economic Plan Predicts Solid Growth And Increases In “Rainy Day Fund”
Even when employing a “conservative” method of predicting economic growth, the GSLP-Libs estimate that Gibraltar’s GDP will hit £2.4B by 2020. If certain investment projects are successful between now and then, the party says this figure will be exceeded and come to represent a 40% growth in the economy in just four years.
GSLP Leader Fabian Picardo said: “We have been able to not only meet but exceed the targets set out in our manifesto.”
He added that his party had spent less than the GSD did in its last term in office.
“We have invested in better things for our community like a new university, housing, a park and more car parks, the CT scanner and chemotherapy – we’ve done more, we’ve gone further and we’ve delivered projects for people.”
He praised the work of Joe Bossano (Minister for Economic Development) and his ability to make “accurate analyses of our economy.”
Liberal Party Leader Dr Joseph Garcia said: “We have continued economic growth and unemployment is at a record low. You are now faced with an election where you can believe the people who ran down the reserves of Community Care to zero, the people who left £1,000 in the reserves of the Savings Bank and left us will £2m in usable cash reserves when we came into office or do you believe Joe Bossano’s predictions which have been spot on year after year?”
The GSLP-Libs say that their policy will continue to be to keep recurrent expenditure below recurrent revenue.
The annual recurrent surplus will be devoted to funding government company losses which the GSLP-Libs say “were covered by advances from the Consolidated fund” prior to 2011.
The balance left over would be utilised to fund capital projects through the Improvement and Development Fund and to increase the reserves of Community Care Ltd.
The GSLP-Libs say there will be no changes to the rates of company or personal taxation in general.
Personal Allowances and tax bands will be revalued in line with inflation and possible incentives for inward investment both for companies and individuals will be considered in consultation with professionals in the private sector.
The GSLP-Libs say they remain committed to reducing Gibraltar’s net debt. Net debt will, they say, be targeted at £300M for the end of the next four years, “well below the maximum limits” of the ratios provided in the law of 80% of revenue and 40% of GDP.
The party says that, by reference to the projected GDP figure for 2019/20 of £2.4B the net Government debt will fall to 12.5% of GDP.
The GSLP-Libs say that this will be lowest GDP/Debt ratio since 1995/96 when the GSLP left it at zero, using the measurement methods adopted by the GSD since 1996.
Mr Picardo explained the idea behind the Rainy Day Fund. This is a pot of money that should be available to meet additional funding requirements if there are future unexpected calls on government expenditure or unpredictable drops in revenue. Other than that, these reserves would be kept “for the protection of future generations.”
In 2011, there was a manifesto commitment to restore the reserves of both the Savings Bank and Community Care which the GSLP-Libs say “had been run down in both cases to zero.”
As of March 2015, the party says that the combined reserves stood at £120M, £100M in Community Care Reserves and £20M in the Savings Bank Fund.
Mr Bossano said that the target in the next four years is that the Rainy Day Fund in respect of the these two entities will increase to £300M by 2019/2020, and would be split with £70M in the Savings Bank Fund and £230M in Community Care Reserves.
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