Together Gibraltar has issued a statement highlighting their disappointment with the Chamber of Commerce's response to Unite's call for  Government borrowing to fund public sector pay rise.

A statement from Together Gibraltar follows below:

The  Chamber's critique of Unite's economic analysis appears to be shallow and  simplistic. Their arguments are excessively partisan in both tone and substance.  These shallow arguments are a disservice to the Unite representatives supporting  workers through a cost of living crisis and risk misinforming the public about basic  economic realities. 

The party is concerned with how the Chamber has dismissed Unite's proposal:  refusing to engage with the substance of their economic analysis. The Chamber  appears to rely on outdated economic theories and principles without acknowledging  the changing economic realities faced by many countries today. 

Most concerning is the Chamber's repeated reference to Joe Bossano's ‘golden rule  of economics’. Sir Joe may be a prominent political figure in Gibraltar, but he is not  an academic authority on economics. Borrowing in times of economic downturn is  supported by leading International luminaries such as: 

• Paul Krugman, Nobel laureate and economist at Princeton University
• • Joseph Stiglitz, Nobel laureate and economist at Columbia University
• • Lawrence Summers, former US Treasury Secretary and economist at Harvard  University 
• Olivier Blanchard, former Chief Economist at the International Monetary Fund  

Their work is supported by history which has shown that countries which face  recessions with borrowing have fared far better than those who resorted to austerity  measures. 

The Chamber's partisan language is also concerning. They suggest that Unite's  economic analysis is "laughable" and sounds like "the kind of economic thinking that  led to the collapse of the Soviet Union". Such language is intolerable and unhelpful in  fostering constructive dialogue and debate. 

In addition, the Chamber's argument against increased government borrowing to  fund public sector pay rises is based on a narrow and archaic view of economics.  The idea that the government should never borrow to fund recurrent expenditure is  outdated and does not take into account the current economic realities faced by  many countries around the world, nor does it spare a thought for the growing number  of workers in Gibraltar who are struggling to make ends meet in the midst of a  rampant cost of living crisis. 

Furthermore, the Chamber's assertion that borrowing to fund additional pay rises will  lead to further increases in inflation is overly simplistic. So too is scaremongering  about how this will affect government’s ability to fund sectors such as health and  education. There are many factors that contribute to inflation, most of them external  to Gibraltar, and increased government spending alone is far from the main driver. 

Overall, the Chamber's press release raises important questions about their  independence and impartiality. It is essential that economic debates are based on a  rigorous and open-minded analysis of the facts and that all sides engage in  respectful and constructive dialogue. 

Together Gibraltar remains committed to rational, responsible economic  management and to supporting a prosperous business landscape in Gibraltar. To  this end, the party urges the Chamber to engage with Unite's economic analysis in a  more constructive, respectful and thoughtful manner.