Below follows the Chief Minister's 2025 Budget Address:

Madam Speaker,

It is with pride that I rise today – in what I am advised is International Day of Parliamentarian -  to move the Second Reading of the Bill.

I note in doing so that, as we were informed by letter, Mrs Sanchez is not with us for medical reasons and we renew our best wishes to her for an early return to our ranks.

M’am, this address marks my twenty-second Budget Address as a servant of our people in his House. 

It is my fourteenth Budget Address as Chief Minister of Gibraltar.

Despite every obstacle hurled in our path, some strategically by our international counterparts, some shamefully by our national counterparts and some selfinflicted (because we are human), we are here, Madam Speaker:

Still standing.

Still governing. 

Still delivering.

And given the events of the past 9 years, Madam Speaker, that is a triumph of my colleagues endurance as much as it is a demonstration of our people’s commitment in voting for us, for our vision for this small nation of ours and for our core values.

We are now one of the very few governments in office at the time of the Brexit referendum who remain in post after Covid. 

Re-elected and re-invigorated.

And I therefore now look forward to taking all Hon Members, not just through the numbers in the Estimates Book, but also to reflect the pulse of our nation’s socio-economic heart in this State of the Nation debate. 

Because, Madam Speaker, this debate is not just about sterile digits. 

The numbers in the Estimates Book represent classrooms fully staffed and hospital beds fully provided for, family homes built and being built.

Because these numbers also represent the future dreams of many in our community.

And it is those dreams, those hopes and those aspirations of our people that we see reflected by the cranes in the sky that themselves reflect what is our undoubtedly vibrant economy – despite the naysayers who have suggested we have been in some sort of economic limbo.

And it is that economy which puts the bread on our tables and on tables beyond our shores.

These numbers therefore reflect the living architecture of our small nation.

A small nation that refuses to bow to the less than positive fate some of the most cynical script for us each day in unfounded social media gloom.

And therefore, today, Madam Speaker, this is more than just a Budget speech. 

It is a chronicle of the challenges we have faced this decade, and a testament to the triumph we as a community are enjoying.

A triumph won through endeavor, enterprise and endurance.

And what a decade it has been.

From the Brexit referendum result. 

To the Grace 1.

To the pandemic that ground the whole world to a halt but saw us in Government working more than ever. 

Then, the Withdrawal Agreement and the New Year’s Eve Framework Agreement.

And then the OS35.

And all this with the cacophony of political instability from London.

With Prime Ministers changing faster than seasons— and the aching loss of our beloved Queen and the joyful Coronation of our King, Charles III, King of Gibraltar.

Through all of that, we negotiated Madam Speaker. 

And then war broke out in Europe;

The UK’s 2022 mini-Budget sent inflation spiralling like a tornado.

And then a war broke out in the Middle East.

Through all that, negotiated, Madam Speaker.

And then President Trump returned to office and upended geo-politics as we knew it. 

Through all of that, Madam Speaker, we negotiated. 

Because, above it all, we faced the ever-turning meatgrinder of Brexit’s potential to undo years of work by successive Gibraltar governments and Gibraltarian entrepreneurs in the building of our successful socioeconomic model. 

From the day of that fateful referendum, we have not had a single moment of our last three terms unshackled from Brexit’s malevolent shadow.

Yet here we are.

Now ready to finalise the terms of our post Brexit acquis with legal text of the treaty being finalised. 

And so today, Madam Speaker, this State of the Nation debate must reflect not only where we’ve been and what we have done.

It must also reflect what we are doing, what we will be able to be do and where we are going to be.

And that is what is most exciting about the announcement of the 11^th of June. 

The opportunities that this Government will be able to offer our people by entering into the Treaty.

Where our entrepreneurs may be able to take or nation as a result of the Treaty. 

Because we are taking our people to the Treaty.

Our people will take the treaty the threads of their day to day lives. 

And our entrepreneurs will take the treaty to the bank. 

Because with all the challenges that change brings, it also brings huge opportunities. 

We recognize the challenges for businesses and we will be there to help.

Some of the measures to help will be set out today. 

Some will come in weeks and months. 

And some will be designed by our businesses with us. 

Today I announce the creation of a Business Transition Advisory Group that will be chaired by the Minister for Business, the Honourable Gemma Arias Vasquez, a former Chair of the GFSB, to advise the Government on the implementation of the Transaction Tax and all relevant business considerations arising from the new EU Treaty. 

The additional composition of the Committee will be announced by the Minister and will include the Chairs of all the business organisations in Gibraltar and the Attorney General. 

It will report to the Cabinet before the end of November on how best to ameloriate any potential transitional effects on businesses.

There will be additional discounts on Business rates to come.  

Those are being designed and will be announced to target those who may be most exposed to the terms of the new treaty.

We will be alongside the businesses community to ensure that they really thrive under these new arrangements.

But the opportunities have been obvious to the many, very excited entrepreneurs who have been in touch with the Government excited at the thought of what the coming years can bring. 

I know that some people will be concerned about the security aspects of a totally fluid border. 

I do not share those concerns, but I understand them. 

I want to reassure all members of the public that the Gibraltar Contingency Council, jointly chaired by His Excellency the Governor and by me, will carefully consider all aspects of the security implications of the removal of the frontier fence. 

I guarantee, as the father of a girl aged 7, that there will be no safer community in the future than Gibraltar, despite these changes. 

With a new Royal Gibraltar Police substation alongside Gibraltar Airport, and a continuing, permanent Customs and BCA presence, we will be safer than ever with the deployment of additional digital security mechanisms.

But despite some concerns, I know that Gibraltar is ready for this next step in our development and growth as a British people.

We are ready to see Gibraltar’s economy now decisively take the fork in the road towards thriving greater growth instead of just turning to surviving and stagnation after a hard Brexit. 

And in doing so, Madam Speaker, to do so in sustainable diligence, we must follow the guiding principles of the Father of the House, a political legend in his own lifetime, who set these out as clear touchstones for the future in his 1988 Budget Address.

Honourable members elected for the first time in 2023 will remember that I referenced those two key principles last year. 

The first is that our key assets are our people and our land.

The second is the Golden Rule. 

Those will remain our lode stars.

In good times and in bad.

And although we expect the good times to roll, we will not fail to adhere to those foundational principles of the first Socialist administration.

And in doing so, Madam Speaker, I want to just reflect how challenging achieving the treaty has been. 

It has meant a lot of travel and a lot of entertaining which we would all much rather not have had to do. 

We have had to be away from loved ones whilst entertaining. 

We have had to travel extensively and sometimes where we could not arrive by scheduled airlines. 

All that we have done with care.

With moderation. 

But with the bigger prize in mind and the, alternative, potential cliff edge in sight as the danger to avoid. 

Madam Speaker, as I address the effect of the announcement of the 11^thJune, may I pause to thank the professionals in our media, our national broadcaster and the only Gibraltar newspaper, unfortunately, still printing, for their exceptional coverage of the events of the 11^th June and the aftermath thereof. 

As I retain responsibility for GBC, I will be including a part on it in the Annex to the written version of this speech which will be laid on the table in Parliament also. 

I want to thank the outgoing CEO, Mr James Neish for his work in the time of his leadership of the organization. 

I also want to thank the new Board of GBC, so ably led by the much loved and equally respected Alice Mascharenas, and including other well known broadcasting and journalistic professionals with sterling legal and accounting support. 

I thank all of them for agreeing to serve. 

Additionally, a similar report of the GRA will form part of the Annex to my written speech.

 

So, Madam Speaker, with that background set out, I turn now to the economic aspects of my analysis of the Schedules to the Appropriation Bill.

In doing so, I will also be referring the House, of course to the Estimates Book.

Once again, this year as every year we have governed, I can assure our community that they can have the confidence that we will continue to act in this Budget as we keeping as our watch words the twin principles of responsibility and prudence.

Because, although we have finally reached agreement for a Treaty with the EU, we have not signed or ratified anything yet.  

Although we see high inflation still at bay, there have been recent threats to higher oil prices which could undo progress literally overnight. 

We must also continue to factor into our calculations that interest rates have fallen, but not as quickly as expected or as the President of the United States and all of us would like – vide his comments about the Chairman of the Federal Reserve! 

And so, Madam Speaker, this year these Estimates will once again seek to provide a prudent spending plan for the financial year.

We will not fail to ensure that we continue to navigate the choppy, if not turbulent, waters in which we find the ourselves without creating future public finance issues for our children. 

Because that is the key. 

As it has been the key in every one of our previous Budgets. 

We follow the Golden Rule on recurrent expenditure.

We ensure that the day–to-day spending we are paying for today is funded from the day-to-day revenue we are receiving today. 

No if’s. 

No but’s.

We will borrow to invest. 

We will borrow to fund multi-generational projects

We will not borrow to pay salaries.

We will certainly not borrow to pay higher salaries.

Because, if we did so, we would be shamefully asking our children to fund public sector incomes today.

How?

Because they would be the ones paying for that borrowing when they are older. 

That is not fair. 

It’s not equitable.

And we will not do it.

We will not lead our nation into lumbering our children with open ended borrowing.

What is fair is to borrow to fund projects that will benefit our children and our children’s children.

I have said as much before. 

That is why we have not been concerned to borrow for schools, a power station, new health facilities and even

to refurbish estates and build new affordable homes that become an appreciating asset in our hands.

These are all projects with an asset value and life of well beyond our time.  

And, of course, it is also true we have had to fund the cost of a once-in-a-100-year pandemic.

Our children also had the benefit of that. 

That is the structure we have been following from day one. 

Because this Budget, Madam Speaker, is, as all our Budgets have been, as much for the short, the medium and the long term.

We are announcing measures for today.

We are designing measures for tomorrow.

And we are recalibrating our economy for the years to come. 

Because our Budgets are always about long term planning for a better economic outlook to come.

That is what we are aiming for now, as each year.

And now doing so knowing we have an agreement with the EU, albeit not yet a Treaty.  

Doing so as we see the waters of ‘No Negotiated Outcome’ appear to retreat – although cautious that we do need to finally agree the Treaty text.

 

REPAYMENT OF THE COVID DEBT & THE UK

SOVEREIGN GUARANTEE 

And, Madam Speaker, in that context it is right I should address the outstanding borrowing in respect of the waters that did hit our shores.

The COVID pandemic hit us like it hit everywhere else.

We cannot just pretend to forget it because we are still labouring under the cost of it.

We must always remember – as I yearly remind all Honourable Members - that we all agreed to take, in effect £500m of debt in order to pay for the costs of COVID. 

Indeed, as I reminded the House last year – and will again next – I will forever remember, the Honourable Mr Clinton, in his capacity as the Shadow Minister for Public Finance, saying, the following words:

“… Now is not the time for us to nit-pick as to ‘is this prudent’ or ‘is this the right thing to do’ at this stage. We need to do what is necessary and we will work out later on how we pay for what we need to do. This is something I thought I would never say, but it is true”.

He said that on Friday 20th March 2020 and it features at line 644 of the Hansard for that date.

And that, Madam Speaker, is the largest portion of our public debt today. 

It’s half a billion pounds deployed as we all agreed it should be. 

Paying costs of the GHA health service in the COVID period.

Paying the cost of all the full amount of the salaries of workers in the public sector, even for those who were not working. 

Indeed, Madam Speaker, it is important for those making pay claims in the public sector now, to remember that in COVID all public sector workers received their full salaries even if they were not at work.

They did not receive BEAT amounts based on the then minimum wage. 

They received their FULL salaries even if they were forced to stay at home. 

The COVID borrowing also went, of course, into paying the cost of all salaries our private sector economy.

That is to say, Madam Speaker, the salaries of those who were locked down.

We also paid from it all the other costs we analysed at length in this House when we did our Emergency Budget in the time of the COVID and our subsequent debates about it. 

So, in this debate, the reference to the half billion pounds of debt is to the extraordinary, multigenerational, COVID debt that we TOGETHER incurred with the express support of the Leader of the Opposition and Mr Clinton and all members of their party then present in the Chamber.  

It is important to keep that context in mind when we hear from Members opposite in coming days about debt levels. 

But whoever agreed or did not agree to it, Madam Speaker, we all have to repay it.

And this year, Madam Speaker, Honourable Members and those watching or listening, will be able to see from page 2 of the Book, that we have repaid £1.5m of that debt. 

This may seem a small amount in the context of the cost of COVID to Gibraltar but it shows our commitment and word that from surpluses we will make repayments towards the debt. 

The sum is termed “Repayment of Public Debt” and features about half way down the page, just above the sum for the Consolidated Fund Cash Reserves as at 31^st March 2025 and it.

Our commitment is pay at least 10% of any surplus towards that debt.

This year we have paid more, 15% of the surplus, although I will provide details later when I come analyse the surplus in greater detail. 

On the repayment of the full amount, as I have already explained to the House in previous years, the Government’s strategy remains to secure a borrowing for the final 20 years outstanding of the 25 year period

we agreed with the UK Government for the Sovereign Guarantee.

Interest rates continue to drop since last year and the expectancy is that they will drop further in the next few months. 

The Bank of England rate is now at 4.25% which is 1% less than when the original facility was originally due for repayment (December 2023). 

This further supports our decision, with the support of the UK, to extend to December 2026 before entering into the long term commitment with a fixed interest rate for the balance of years remaining. 

Despite criticism from the Honourable Mr Clinton, our decision has been proved correct and we have ensured that we have saved our taxpayers millions of pounds in interest rates over the next 25 years, by not entering into a long term repayment plan in 2023, when interest rates were at their highest.

So I am very pleased, Madam Speaker, that I followed the advice of the now Financial Secretary, Charles Santos and of Albert Mena, the former Financial Secretary and of the Honourable the Father of the House, Sir Joe Bossano and disregarded what the Honourable Mr Clinton said.

By ignoring the Honourable Mr Clinton, we have thereby delivered savings of millions of pounds through the benefit of today’s lower rates for the taxpayer. 

I want to ensure the House fully understands this disagreement, given the financial AND economic consequences it would have had for our nation.

Madam Speaker on Tuesday the 11^th July 2023, dealing with the COVID debt, during the morning session, I said this during the course of my speech on the Second Reading of the Appropriation Bill 2023/24, explaining why were not the repayment of the COVID debt for the remaining 22 years then. 

I said: “We changed our strategy in partnership with and with the full support and advice of HM Treasury. We therefore engaged with the banks and extended the current facility for a further three years, to December 2026. That means that we can fix for the final 22 years when interest rates are again expected to be lower, thereby taking the benefit of those lower rates for the taxpayer. If they have not come down yet, we can fix again for three years, if we have to, and wait until the best moment when interest rates are deemed to be again at a low, and then fix for the remainder of the 25 years.”

 

The Honourable Mr Clinton was not impressed. 

He said this, which can be read from HANSARD

Thursday 13^th July 2023, afternoon, page 7 ,at line 249 “… despite having signalled last year in his Budget speech that he is looking for a 25- or 26-year rollover, the mere three-year rollover of this £500 million or appropriate facility on 3rd December 2023 up to 2026 is very worrying, as it has been on the cards for a long time. What we needed was a long-term facility and repayment terms as necessary to precisely restore financial stability. I am not convinced at all by the Chief

ball? Can I please borrow it? We would both be rich men if he can predict with that accuracy what interest rates are going to be doing in three years’ time. I am not even convinced that this new facility would not be at a floating rate or a higher rate. Who knows? But he is telling us that he thinks, in his judgement, in three years he will be able to do a better deal. I do not buy it and he has not been able to get a proper financing deal for this amount of money.”

By the following year, that is to say, last year, he was more emollient.

On  Tuesday the second of July, in the afternoon session, at page 29, at line 1395, his only relevant comment, having demonstrably got it COMPLETELY wrong the year before, all he said was: “it is anticipated rates will be cut…”

But this year, Madam Speaker, as we analyse the accounts, it is important to reflect on the effect of what the Honourable Mr Clinton said on the 13^thof July 2023.

I am afraid the 13^th will turn out not to be lucky for him.

Because the consequence of what he was saying and his insistence that we should have fixed then, not being open to even consider that what we were saying was potentially right, is huge.

It would have led to a massive financial loss for our community. 

Massive.

Not a trifling figure, Madam Speaker.

A MASSIVE FIGURE.

And our community needs to know. 

Even if interest rates do not go down and further than they have today, the rates are already down 1% since that debate.

If I had done what the Honourable Mr Clinton suggested, and fixed 2 years ago, it would have cost all of us, the Gibraltarian taxpayer and our children, 1% more.

Now, that doesn’t really sound like much, does it. 

Of course not. 

What’s 1% amongst friends?

Well, get your calculator out Madam Speaker.

Let us calculate what that extra 1% would have meant if we had done what the Honourable Mr Clinton was urging us to do…

It is 1% of £500m we are talking about.

So, 1% of £500m is £5m.

But that is not what the Gibraltarian tax payer would have lost if I had allowed the Honourable Mr Clinton’s view to prevail over Mr Santos’, Mr Mena’s, Sir Joe’s and my view.

No. 

I must not be unfair to the Honourable Mr Clinton. 

I must do the whole calculation for his benefit and the benefit of the whole community. 

It is that amount of interest, that is to say £5m a year… for what then were 22 years left of borrowing. 

So, the total the taxpayer would have lost if we had followed Mr Clinton’s advice, would have been 22 times the £5m.

On that same rhetorical calculator, Madam Speaker, the sum you will be left with would be £110m.

£10m would already have been paid. 

Lost.

The remaining £100 million of the “Clinton Charge” would be spread over the next twenty years.

If the rate drops by another half a percent, Madam Speaker, the savings we will have achieved for Gibraltar (and, conversely, the loss the Honourable Mr Clinton would have inflicted upon us all) will be another £55m.  

If it drops one more whole percentage, the savings under our approach will be £220m.

And that is NOT fanciful, Madam Speaker. 

Indeed, Madam Speaker, the finance geeks amongst us will be aware that Morgan Stanley are this week predicting 7 more quarter basis point cuts for the US economy between March 2026 and the end of 2026.  

President Trump is – how can I put it politely – ‘chivvying’ Federal Reserve Chair, Jerome Powell along in fairly unprintable language.

Now, our interest rate is UK based – but the Bank of England rate is often a near mirror of the US. 

That means, potentially, another almost 2% more of a reduction in the headline interest rate. 

Euribor rates are already very substantially down.  

12 month Euribor is down almost 25 from 4.15% in July 2023, when Mr Clinton gave his speech, to 2.45% now. 

So, Madam Speaker, it is not impossible that when we come to fix the rate for 20 years it will REALISTICALLY

be 2 or 3% less than when the Honourable Mr Clinton told us we were wrong to wait. 

So what I am telling this Community, Madam Speaker, is that it is realistic to calculate that following the Honourable Mr Clinton’s advice would have cost us in the region of between £220 and £330 MILLION POUNDS over 22 years.

If I had made mistakes that could have cost us that much, the Honourable Mr Clinton would say that I should immediately resign. 

It is that consequential. 

The mistake that the man the GSD tell us is an economics guru would have cost this Community in the region of a QUARTER OF A MILLION POUNDS over the 22 years since he vehemently urged us to follow his advice. 

But I will not say that he should resign, Madam Speaker. 

I prefer he should stay there to make the GSD even more of a sitting duck at the next General Election with him as a candidate. 

Another lame duck candidate. 

Just like the lame duck candidates that Mr Azopardi, thankfully, choose to put before the electorate in 2023.

The man who would have made the Quarter of a Billion Pound mistake with your money.

The loss under the Honourable Mr Clinton’s approach would also have been on that scale, Madam Speaker.

In the region of a quarter of a Billion pounds.

It slips off the tongue. 

But the effect would have been deadly. 

Quite catastrophic.

In education.

In health. 

In affordable housing. 

In all areas of public services. 

Sharp and cutting austerity would have been necessary because of Mr Clinton’s mistake. 

Because he thought he knew better than Sir Joe, than the current and former Financial Secretary.

And of course, because, as ever, he thought he knew better than me. 

So it is a very good thing indeed for Gibraltar for many reasons that the GSD did not win the last general election.

I bet even those sitting alongside him are now delighted they did not win and did not confine Gibraltar and the people of Gibraltar to suffer the consequences of the Honourable Mr Clinton’s hubris, arrogance and massive error of judgement. 

They would have fixed the interest rate then for 22 years. 

That would have done for us now and going forward. 

In economic analysis terms alone, this is probably the biggest mistake any Member of this Parliament has ever made.

I hope he will at least accept this when it comes his turn to speak.

If he does, he will demonstrate humility, at least.

But, of course, it is ‘falling on your sword’ stuff. 

And I hope he doesn’t because he is so degraded by this that he will be a brilliant candidate for us in the GSD at the next election.

With his credibility shot.   

Because in factual terms, without speculating by how much the interest rate may go down further, just based on what it has done down from November 2023, the month after the last election, Mr Clinton’s policies would ALREADY have cost us £110m, of which we would already have paid £10m THROWN AWAY.

Another GSD £10M thrown away.

Another Theatre Royal thrown away.

ANOTHER GSD mistake of theatrical proportions.

Madam Speaker, when you are listening to the Honourable Mr Clinton this week, indeed, all Members, when they are listening to Mr Clinton this week, should all remind themselves of what following his view would have amounted to. 

What it would have cost us.

And why, our view, was better - criticised so vehemently as it was by him and by others of members opposite, do doubt led by him.

And this Madam Speaker is a POUNDS SHILLINGS AND PENCE demonstration that the Honourable Mr Clinton is wrong.

And expensively wrong at that.

Hugely WRONG.

Unaffordably WRONG. 

Expensively WRONG. 

And at a cost that would mean the difference for so much in our community.

Having to spend either £110m more on interest of £220m more on interest each year would have been damning for our community. 

He complains about our spending. 

At least we spend on our people.  

On our community. 

On our health and education services. 

He would have frittered it all away on BANKERS INTEREST.

So, neither this week, next week and no week will we take lessons from the £110m LIABILITY that is Mr

Clinton. 

His comments have not aged well. 

His analysis has not aged well. 

His credibility does not end well. 

It is shot. 

Just like his advice, which they slavishly follow, to vote against the Budget. 

And so, henceforth, we will see everything he says – and the public should see everything he says – through the prism of how much following his advice would have cost us.

He is ALREADY now no more and no less, Madam Speaker, than a       living,        walking,        breathing EMBODIMENT of a £110M LOSS.

And that loss will only get higher as we see interest rates continue to go down. 

And his mistake, Madam Speaker would have created too much of a liability to ignore. 

And all his criticism and all his analysis must now be seen in that light. 

Just like his idea that all borrowing should be no the Government’s books, which would have not enabled us to borrow more when we needed it as a result of COVID.

Wrong on every analysis, but vehemently insisting he is right. 

Just like Mr Azopardi, on his election candidate selection, his initial insistence we should have been in the TCA and his complaints that we were taking too long to bring back a deal instead of concentrating on the substance of what to be negotiated.

Just like Mr Bossino, on his continuous concerns and complaints about things which turn out very well indeed, like the Upper Rock ticket fees which led to more and not less revenue – demonstrating once again, what ‘Reverse Oracle’ he is... everything he predicts, fails to come true. 

Nostro Damon is no Nostradamus! 

A GSD leadership which is as wrong about the small things as it is about the big things. 

Luckily, they did not prevail at the last election. 

Enough people saw through them.

Anyway, all that said, as a result, over the next 18 months the Financial Secretary and I will be exploring the best options to enter into that long term, 20 year, repayment plan with the UK Government to crystallise the Sovereign Guarantee for that period. 

And now, Madam Speaker, for all the reasons set out above, and as inflation recedes further and interest rates are receding also, we are being proved right in our management of our public debt.

We were right to repeat each year that it was likely the markets would settle and interests rates would be lower over the three year period of the extension of our loan.

And the electorate were right, Madam Speaker, to put their faith in us at the election – or it would have cost us at least £110m - £10m frittered away already!

 

 

THE UK GOVERNMENT SOVEREIGN GUARANTEE  

Madam Speaker, I also want to briefly confirm to the House that the change of Government in London last year, just after the Budget Debate, has not changed the attitude, appetite or approach to the UK Sovereign Guarantee, subject, always, of course, to final agreement on terms.  

I want to reiterate the gratitude of the People of Gibraltar to the United Kingdom Government and His Majesty’s Treasury for their position in continuing to support Gibraltar on our long-term repayment plan on the multi-generational COVID debt. 

I therefore am pleased to be able to repeat, Madam Speaker, as I told the House last year and the year before, that I see no reason whatsoever that we will not, as we anticipated, have the facility and the guarantee for the full  25 year period, counting from 2020, to enable us to fully amortize the interest on the repayment of the COVID debt we all agreed to acquire to deal with the pandemic. 

 

 

 

THE PUBLIC FINANCES 

And so, Madam Speaker, having taken the House through all of that preliminary material, having reconfirmed the importance to us of the Golden Rule in every aspect of our analysis and having underscored the potentially losses of taking the Honourable Mr Clinton’s advice in respect of any aspect of this public financing of this Community, I turn now to an analysis of the current state of the public finances of our nation.

Again this year, as I established in 2022, the Draft Estimates Book for the current Financial Year 2025/26 is now once again published online.

I trust that will enable any member of the public that wishes to follow this debate as they listen to the debate in this House.

As I have done in previous years, therefore I will refer to the relevant pages of the Book so that those watching or listening who wish to do so can follow the figures in the Estimates Book. 

Indeed, as an aide to transparency and accountability, all Estimates Books from 1997/1998 to 2024/2025 are also published online^[1]. 

As in previous years, I urge all those watching or listening who wish to follow the economic part of the debate to look at the Estimates Book as we go through the relevant sections of my speech.

I will once again refer to the relevant page numbers of the Estimates Book during my speech to make it easier to follow. 

And, Madam Speaker, again for all the reasons I have set out already in my approach thus far, the figures in the book are all based on a very prudent approach to estimating income and slightly over-estimating cost, as has always been the case. 

We prefer to err on the side of caution, Madam Speaker. 

Madam Speaker, at this time last year, I highlighted that the main aim after the first full year post Covid was to restore a surplus. 

We did this with a surplus of £1.9m for 2023/2024. 

The next objective is to continue to deliver annual surpluses and not drop back into deficit at all. 

This is not straightforward.

It requires significant work. 

The times of ‘large’ surpluses are behind us, at least for now, and we now must operate within very tight budgets in order to achieve a surplus.

Last year, I told the House that the projected surplus for 24/25 was £3.252m. 

Our performance will not disappoint. 

I am pleased to report that for 24/25 not only have we exceeded the projection, we have exceeded it by three times as much and the forecast surplus is £9.782m. 

This is the second year running post-covid that we have managed to achieve a surplus and that is a very good thing.

We have also, happily, greatly exceeded the estimated surplus by a factor of three.

If our first surplus post-COVID was the swallow that did not quite make the summer, this summer, the other side are going to have to swallow that the surpluses are clearly back. 

We will continue to work towards greater surpluses by our careful management of the public finances.

Sticking to the Golden Rule.

For, Madam Speaker, that is what a surplus represents.

That our costs have not exceeded our revenue. 

How have we achieved that, Madam Speaker.

By managing and controlling expenses.

By pursuing revenue.

Running a tight ship, Madam Speaker. 

And all whilst negotiating the agreement for a treaty with the EU.

That should not be taken for granted, Madam Speaker.

In fact, it is what has made the past 9 years quite so personally, professionally and politically difficult. 

Because we could easily have fallen for the trap of allowing spending to run riot. 

We have been through two different elections since 2016. 

Yet we only ever went into deficit AFTER an election year. 

It happened as a result of the pandemic. 

But NOT because of our departmental spending somehow being out of control as we tried to spend our way out of any political difficulties. 

No. 

But that has happened before. 

Honourable Members will recall that I told them last year that the only year since the turn of the century when Gibraltar has fallen into a deficit when there hasn’t been a pandemic requiring the shutting down of the economy and the locking down of our people, was in Financial Year 2007/8.

A GSD year in office. 

A GSD deficit. 

A GSD failure. 

The F for failure that doesn’t still to us, but sticks to them when the record is properly analysed. 

Our only F is for Fabian!

But, as I say every year to everyone in this great community of ours, to be clear, Madam Speaker, I am not claiming credit for the surplus. 

Neither I nor the Government produce that cash.

Sure, we ensure it is not frittered away on unnecessary interest payments, as Mr Clinton would have done. 

But we do not contribute the money to our economy.

We all do, in this economy.

It is a collective effort. 

The fruit of all our contributions.

The collection of the taxation and other revenue which comes from operating in this economy. 

My job is just to announce it here each year, having – to their chagrin – been elected repeatedly to do so.  

And that is why I want to pause – as I rightly do each year, Madam Speaker - to thank everyone in this economy who has contributed to this surplus we are declaring today. 

To thank every worker and every entrepreneur for their hard work.

For their endeavour.  

For their effort.

And for the increased revenue that we have had as a result.

Additionally, Madam Speaker, as I do every year, I want to also expressly thank every single controlling officer in the departments and Ministries who has brought their department, agency or authority in on target.

And I obviously thank all of my ministerial team for their sterling efforts, in particular the Father of the House.

Madam Speaker to now break down for the House, and for all those watching from the wider community, how the surplus is reached, I am going to go through the numbers in a more detailed analysis which I hold will assist everyone to understand the sum of the numbers for last year.

 

REVENUE 2024/2025  

The first thing I am going to analyse is the incoming cash.

 

That is what we call the public revenue aspect.

 

This is the money coming into Government coffers over the last financial year. 

 

Last year, Madam Speaker, third-party revenue came in at £746m, which was £13m more than our projected revenue of £733m. 

 

That was, last year, a RECORD HIGH revenue, Madam Speaker.

 

This year, Madam Speaker, we have been able to go even further.

 

Our revenue for 2024/2025 is over £800m. 

 

We have broken the £800m barrier. 

 

In fact, the outturn is £813.36m. 

 

This is a new record of revenue collected. 

 

And this in a period some were saying we were in

‘limbo’.

 

According to the Leader of the Opposition, last year, we were “drifting”.

 

And yet, Madam Speaker, this is the highest revenue in Gibraltar’s history. 

 

I am able to repeat today AGAIN that the GSLP Liberal Government has achieved the highest revenue in the history of our public finances.

 

I AM ABLE TO CLAIM, AGAIN, ANOTHER RECORD SOCIALIST LIBERAL YEAR.

 

Madam Speaker, this record highlights that our revenue streams not only continue to recover but also that we are moving in exactly the right direction after the devastating impact of Covid on our economy.

 

And all of this BEFORE the announcement of the agreement for a treaty with the EU. 

 

Madam Speaker, for those that are following using the Estimates Book Page 5 summarises the performance of the different recurrent revenue streams. 

 

So, how was this record revenue accumulated?

 

Personal tax came in higher than the estimate even with no increase to personal taxes. 

 

This is important given my announcement last year of the return of personal taxes to 25% sooner than originally expected. 

 

We lowered personal taxes and still received higher personal tax revenues than anticipated. 

 

Corporate Tax came in at £60m higher than the estimate. 

 

That can be seen from page 6, Madam Speaker.

 

The £50m exceptional revenue received in this year contributes to the £60m. 

 

I commend the Honourable Mr Feetham, who has responsibility for taxation, for these extraordinary numbers. 

 

I am clear that his understanding of taxation and the team he has assembled has enabled us to address areas where some corporates were not acting as one would expect.

 

That has been corrected and although one item of revenue was exceptional this year, we anticipate that others will now also understand that behaviour has to change.

 

Tourism continues to recover after some extremely bad years with collections in Tourist site receipts and aviation coming in lines with the estimate.

 

Indeed,     despite     the   Honourable      Mr    Bossino’s continuous        cacophony        of        complaints,       Museum entrance receipts are up 25% from £60,000 to £75,000.

 

I will not need to remind the House of the Honourable Mr Bossino’s antipathy to the operators of the Museum.

 

He may want to ring them and apologise after these numbers.

 

More importantly, Tourist Site receipts are up.

 

The Honourable Mr Bossino was also against the increases in ticket prices that the Honourable Minister, Professor Cortes, has instigated over the past year or so. 

 

In fact, in February this year, the Honourable Member opposite said this, although his brief does not include tourism but he does ask questions on the subject and television programmes also.

 

The relevant quote is this: in the afternoon Hansard for Monday 24^th February in the afternoon, at page 36, 1581, talking about the ticket price increase: “that has the potential, I would have thought, of making the access to the nature reserve less attractive. It may defeat the purpose, that the hon. Member, wants to achieve”.

 

The Honourable Mr Bossino was wrong, Madam

Speaker. 

 

Just like the Honourable Mr Clinton was wrong about the interest rates not coming down and Mr Azopardi was wrong about our economy, our nation or our negotiation ‘drifting’.

 

Because, in fact, Madam Speaker, as can be seen from page 9 of the Estimates Book, at line 54, Tourist Site Receipts, which is where the increased ticket prices are reflected, shows an incredible growth from £9.1M the year before to £11.5M.

 

That is actual growth of more than £2M in cash.

 

That is over 25 or 26% growth. 

 

It seems like everything the GSD criticise goes the wrong way, Madam Speaker. 

 

Perhaps the Honourable Mr Bossino might like to also call the Honourable Professor Cortes and apologise to him also for nay-saying his ticket price increase and his private sector investment mechanism. 

 

Additionally, the estimate is for a further growth to £15M in this, current Financial Year 25/26.

 

That would mean a 64% increase in Upper Rock revenue in 24 months – part of which is to be shared with the private sector investors who are providing the new facilities for tourists to visit at no cost to the taxpayer. 

 

It would also mean a FURTHER vindication of the Honourable Professor Cortes’ strategy.

 

Conversely, of course, Madam Speaker, it is further condemnation of the Honourable Mr Bossino’s style of politics which is to rubbish everything we do and suggest that everything we touch turns to rust. 

 

Well, Madam Speaker, we may not be alchemists. 

 

We may not turn metal into gold and we do not pretend to.  

But it is clear that the Honourable Mr Bossino is as much of a political pessimist as Messrs Azopardi and Clinton who, Honourable as they are, are as wrong as him about every aspect of their analysis. 

 

It is worth bearing that in mind as we hear what they have to say this week, with their traditional negative take on everything and the figures that they will try to use to traduce this excellent level of revenue to our common public purse. 

 

In fact, the Honourable Mr Bossino will no doubt find some way to also traduce the fact that tourist arrivals and cruises are all UP, UP, UP.

 

He will also, no doubt, also find a way to complain that tourist expenditure, although not quite yet at the 2019 level, is already above the 2018 level. 

 

The rest of the revenue was in line with expectations. 

 

This reflects a stable position in our income streams. 

 

Those following the debate with the Estimates Book by their side can see, from the bottom of page 10, that overall Departmental Fees and Receipts came in at approximately £5m more than we estimated.

 

I welcome that and credit the team at the Ministry of Finance, led by the Financial Secretary, for their work in this respect.  

 

I should just also highlight that the introduction of the Personal       Vehicle     Registrations        has   been         an outstanding success. 

 

We have sold more than 700 personalized plates to date which have generated more than £1.5m in revenue. 

 

In the last financial year 2024/2025 we collected £1,615,950 from the sale of 692 plates.

 

In the current financial year, 2025/2026 we have already collected £95,250 for 43 plates up to mid-June.

 

I expect further, exciting, developments in this regard very soon. 

 

Finally, Madam Speaker, the increased revenue has not only generated a surplus but also increased available cash reserves. 

 

This additional cash has allowed HMGOG to undertake the following transactions:

 

The part repayment of a settlement by Care Agency, in respect of which we have paid £6m.  

 

And a Contribution to the Sinking Fund of £7m.

 

 

THE CASH RESERVES

 

Madam Speaker, very often we are told that our financial management is not prudent.

 

Since that argument first appeared on the political scene, led by the Honourable Mr Clinton for our generation, the voting public has not agreed with members opposite.

 

Quite the opposite, in fact.  

 

Indeed, those arguments have crashed and burnt at each election and the have crashed and burnt on the issue of an offer of Bonds and Debentures from the Savings Bank.

 

But I do just want to remind all Honourable members of what the cash reserves were in 2011 when we were elected. 

 

In fact, the cash reserves at the end of the financial year 2011/2, when they left office were £212m.

 

Today, the cash reserves are £268m.

 

Additionally, we have also paid a contribution from the Cash Reserves to the Social Assistance Fund of £8.8m as well a to the Improvement and Development Fund of £10m (although that remains part of the Reserve when placed there), which can be seen on page 2. 

 

Without these latter two transactions, the Cash Reserves in the Consolidated Fund would be £8.8 M or almost £9M higher. 

 

That would make our total Cash Reserves £277M or £65M higher than when we were elected. 

 

And that is despite Brexit and COVID – afflictions that did not affect them in the period before we took over in 2011. 

 

That calculation of the Cash Reserve includes the sums in the Savings Bank Reserve, which is available for the Government at any time.

 

I would remind them and the general public, the GSD at ONE THOUSAND POUNDS.

 

Last year, I reported that the Savings Bank had a reserve of £76m up from £67m in 23/24. 

 

It was predicted then that the reserve would be at EIGHTY MILLIION POUNDS. 

 

In fact, today, under the steady stewardship of the Father of the House, the Savings Bank Reserve is up a further SEVEN MILLION POUNDS.

 

It is therefore, already, at EIGHTY THREE MILLION POUNDS.

 

That is a huge demonstration of who are the better stewards of our people’s money.

 

The deposits are already at £1.9 BILLION POUNDS.

 

The prediction is that the Savings Bank Reserve will be at over NINETY BILLION POUNDS by the end of this financial year. 

 

A success that is down to the political conviction of one man, Madam Speaker, the Honourable Sir Joe Bossano. 

 

Because, Madam Speaker, it seems to me that the more that Mr Clinton criticizes us and the Father of the House for the management of the affairs of the Savings Bank, the better the Savings Bank does. 

 

In fact, the public seem to do the exact opposite of whatever the members opposite say. 

 

Just as we do the opposite of what they did in Government. 

 

We do NOT raid the Savings Bank reserve to increase our surplus, like they did. 

 

We maintain our reserves.

 

And as a result, we have a higher level of cash reserves than ever before and more than they had at the end of their term.

 

             

EXPENDITURE 2024/2025 

 

Madam Speaker on the expenditure side, for the year just past, I believe we have once again managed reasonably well. 

 

Indeed, in setting our expenditure into its proper context, we must not forget that the Government is not immune to the increasing costs around us. 

 

Increased costs affect Government’s too, not just workers. 

 

CONSOLIDATED FUND CHARGES 24/25

 

We estimated Consolidated Fund Charges of just a few pounds shy of £120m and the projected forecast is

£128.416m

 

For those that are following the debate by reference to the Estimates Book, those numbers can be seen from totting up the columns on Page 16 of the Book. 

 

HIGHER PENSIONS COSTS

 

One of the reasons for this increase are higher Pension costs and greater borrowing costs than estimated. 

 

In respect of pensions, Honourable Members must recall that the GSD ended the Pensions Act provisions on final salary pensions and introduced a new contributory scheme for Civil Servants. 

 

 

When we were elected we respected that and introduced the Superannuation Scheme for the lower paid. 

 

We have not undone the GSD position as we accept it was the right thing to do. 

 

But we are now in a situation where we are paying BOTH pensions under the Pensions Act out of the Consolidated Fund Charges AND contributions to contributory schemes from each of the Departmental Heads.

 

Both costs will continue to rise until the Pensions Act costs reduces upon the death of those entitled to payments until the scheme.  

 

Those payments are likely to continue, at least to some extent for another 80 or so years. 

 

That means we are in the worst of both worlds as a result of the GSD’s decisions in Government.

 

We are not complaining about this, because it was the right thing to do, but it is right to point out that it creates this issue for a couple of decades that the Government is paying on the phasing out of the Pensions Act payments and on the contribution to the new schemes. 

 

That also increases cost and unflatters our accounts. 

 

This financial year 25/26 Pensions Act costs will be in the region of £63.25M out of Consolidated Fund Charges.

 

Payments to the Contributory Schemes will be about £19.3M.

 

The total figure between the two is expected to rise to £100M in 29/30 and to continue to rise until the Pensions Act costs starts to reduce through what one might, unattractively, call ‘natural wastage’.

 

I know that Members opposite love to refer to things that might ‘flatter’ our accounts. 

 

They may also, fairly, wish to reflect on matters that ‘unflatter’ our accounts. 

 

The ‘ugly’ filter on SnapChat, Madam Speaker, but just for the accounts!

 

TAX REFUNDS

 

For this year, again, in in respect of Tax refunds, we kept to the estimate of £10m.

 

This is in keeping with our position that the Tax Office should not keep a taxpayers overpaid tax for a moment longer than it should. 

 

We have been consistent in providing his amounts which is massively larger than the amounts Honourable Member’s used to provide when they were in Government and they did hang on to other people’s money to flatter their accounts. 

 

Yes, Madam Speaker, even the lower sums of Cash Reserves I referred you to included many millions, likely more than £10M which the GSD was hanging onto and which belonged to taxpayers and not the Government.

 

We have fixed that too.

 

We will continue to ensure that we stay ahead of the curve on this and that we provide money for the Commissioner of Income Tax to be able to repay what is due from him to taxpayers with the same alacrity that we require taxpayers to pay the Tax Office the sums due from them to us. 

 

We could, of course, pay less back to taxpayers and have greater surpluses but that would be to artificially flatter our accounts as the GSD did. 

 

We will NOT do that. 

 

We will NOT hang onto your money. 

 

We will give it back as soon as possible.  

 

DEPARTMENTAL EXPENDITURE

 

As for departmental expenditure, Madam Speaker, we estimated just shy of £610m and the forecast outturn is £675.165m. 

 

The overspend of £66m or just over 10% of the estimate. 

 

For those following the Estimates Book a summary of this can be found on page 14. 

 

A break down of the overspend is important for the House in its analysis of the Outturn figures.

 

 

GHA/ERS/CA £36m LOWER THAN 24/25 & INC 6M

 

The main area of overspending is the Health Authority, Elderly Care and the Care Agency.

 

Of the £66M overspent, £36M relates to these areas. 

 

Despite that, the overspend in nowhere near the percentage overspent when the Leader of the Opposition was Minister for Health, as I have already shown in years past. 

 

I trust he will not be attacking the overspending here or I will have to, boringly, go back and repeat the things I told him previously when I shamed him by showing how he had been one of the worst over spenders in

Ministerial history in Gibraltar.

 

Additionally, Madam Speaker, I was struck by one aspect of Ms Ladislaus’s questioning last week on complement matters. 

 

I was surprised that, sitting as a GSD MP she thought she had the moral authority to suggest to a GSLP Liberal Minister that there was a staffing issue in the GHA.

 

I asked the Financial Secretary to for an exercise on the numbers of persons employed in the GHA under them and under us. 

 

Under them is was 787 and 144 industrials.

 

Under us it is 1,209 and 186 industrials.  We have added 15 GDC employees also.

 

The total cost under them was £88 million.

 

This year, under us, it is £166 million.

 

Exactly double. 

 

So how can she complain about staffing levels from the GSD benches?

 

It must by politically hypocritical.

 

In fact, although overspent, this year the overspend is considerably lower than last year and shows a taming of the post COVID Health Budget.

 

But, Madam Speaker, we continue to provide the best care and service to the people of Gibraltar. 

 

This comes at a cost which at times we cannot project

for.  

 

Expansion of services across the GHA, increase in cost of medical supplies, drugs and pharmaceuticals (although that may be about to change), increases in the workforce to ensure the services are delivered and ensuring all our people are taken care off abroad add to the increasing GHA costs.

 

There has also been an increase in costs of providing care to people at home with the changes to a company being run by Community Care.

 

In the long run, this will assist in the reduction of costs, but Gibraltarians know, or should know, that the domiciliary care provided by the ERS and Care Agency is now amongst the most generous in the world and it costs money.

 

We increased the cost of this dramatically when we were elected and we make no apology for it. 

 

Member’s opposition try to tie a noose around our necks by suggesting we should do more but then insisting that we should save money, whilst marching in support of us increasing wages and numbers of people employed. 

 

Never has a political party tried to run with the hares and hunt with the hounds as much as the modern GSD. 

 

Perhaps they should rename themselves the Gibraltar Hares & Hounds Party. 

 

Sounds better than Grimmy, Smelly Diesel, at least!

 

In fact, that may be a useful moment to just remind Honourable Members Opposite that they are the party of the Diesel Power Station on the Upper Rock. 

500. 

The Power Station at Lathbury which they heralded as

the future, although it would destroy views to the south from Jews Gate. 

 

Thy were the party that would have funded that power station through company debt and would have thought nothing of it. 

 

They were the party that opposed our opting for LNG.

 

Well, Madam Speaker, given that, it really does ill befit them to be the party that might complain about overspending. 

 

Even if we were to put to one side the Honourable Mr Clintons massive, quarter of a Billion pounds mistake on interest. 

 

Now, having seen the power station operate for some years, I can tell the House that IN JUST FIVE YEARS OF OPERATING ON LNG the saving for our community has been £78.5 million.

 

That is the difference between the cost of the LNG actually purchased against the equivalent cost of purchasing diesel fuel over the same period to produce the same amount of electricity.

 

So, Madam Speaker, you could add that £78.5 million to the cost of the mistakes made by the GSD.

 

When added to the Honourable Mr Clinton’s quarter Billion and the £10 million on the Theatre Royal and the £7 million loan to the Noonan Companies that we lost completely, the GSD losses just mount up. 

 

But the Honourable Mr Clinton is still leaps and bounds ahead of all other mistakes. 

 

So, we will not take lectures from Members Opposite on spending which has been targeted and delivered in care for our people. 

 

Their overspending would have been frittered away on list interest or burnt into the air on additional costs for diesel. 

 

And, anyway, Madam Speaker, the £36M overspend could have been reduced even further to £30M, but we agreed to pay £6M of a settlement that the House is aware the Care Agency had to pay from the recurrent account this year. 

 

This is a one off payment. 

 

 

EDUCATION - £11m

 

Again here are good reasons for overspending on education where the over budgeted amount is £11M. 

 

We provide top level education at all our new schools.

 

That is not a reference to the fabric of the buildings.

 

It is a reference to the teachers and learning support assistants we provide. 

 

Our provision for Special Educational Needs is literally world class. 

Led by UK thinking but in just about every school exceeding UK provision. 

 

Something to be proud off. 

 

Ensuring our children receive this comes at an increased cost. 

 

Although we are on top of ensuring that there is no waste or abuse, there is increasing provision being made here for good reason. 

 

We are nonetheless studying of there is a more efficient way of providing the same service using more targeted services to each student on an AI led basis. 

 

In addition to the £36M of Health, ERS and Care Agency, the £11M from Education accounts for £47M of the £66M overspend. 

 

 

SOCIAL SECURITY - £7M 

 

A further £7M originates in the payment to the social assistance fund. 

 

This is partly due to the £10m additional contribution to the Social Assistance Fund which has been paid to Community Care.

 

That accounts for £54M of the £66M overspent in the past financial year 25/26.

 

 

OTHER

 

The remaining £10m-12m overspent is spread across the departments. 

 

Some such as Environment and Collection of refuse have seen cost increases of near £2m that we will see ameliorated, whilst other departments have savings which offset overspend.

 

The Housing Works Agency was also allowed to overspend when we saw more income in the revenue heads meant we could do more to fix properties up for new tenants etc. 

 

Again, this is spending we would all agree should be undertaken if we are able to afford it. 

 

 

THE £1,200 PUBLIC SECTOR PAYMENT 24/25

 

532. The overspend is also inclusive of the consolidated public sector pay rise which was NOT provided for in the 2024/2025 estimate.

 

 

             

ESTIMATE FOR THE YEAR AHEAD 2025/26 

 

Madam Speaker, for the current financial year we are projecting a surplus of £5.3m. 

 

That can be seen on page 1 of the Book

 

We are on the right track in our economic policies and therefore we are projecting a surplus greater than the £1.9M we achieved in 2023/2024 but, prudently less than the £9.8M we have achieved for 2024/2025.

 

Of course, these estimates were finalised in March of this year and at that time we had not finalized the agreement for a treaty with the EU.

 

Incidental reports suggest that there is already a lot of economic activity as a result of the announcement of the agreement, especially in the real estate market.

539. 

That may positively affect economic performance of companies and may drive public sector revenue even in these pre-treaty stages. 

 

As a result, although we do not expect a significant period of operation of the treaty itself in this financial year, the certainty that the announcement of the agreement for a treaty has brought may help accelerate growth and government revenue even in this financial year. 

 

Of course, during the estimates process we have tried to factor all items that can influence public finances such as the impact of inflation or changes in interest rates – but these are not crystal ball gazing exercises.

 

The process is one of estimating based on detailed analysis and prediction based on previous performance and that is as much an art as it is an science.

 

It is for that reason, Madam Speaker, to avoid nasty shocks and to ensure that any discrepancy is, insofar as possible, a positive one, the estimates are, annually, done in a rightly extremely prudent manner. 

 

 

 

EXPENDITURE: 2025/2026

 

Madam Speaker, in respect of expenditure we are projecting a total of £768m for the current financial year.

 

The figures are there, on page 1 of the Estimates Book for those following.

 

That is a cool THREE QUARTERS OF A BILLION POUNDS for financial year 2025/26.

 

The broad split as follows:

 

Consolidated Fund Charges which are projected to come in at approximately £125.2m.

 

That figure, if we hit it, would be £3.7m less than the outturn for 2024/2025, the financial year just ended.

 

Importantly, Madam Speaker, this includes a provision for pension increases and an increase to repayment of revenue, where the Government returns monies received from tax payers or from those who have otherwise made payments that fall to be returned, from £10 to £15m.

 

Borrowing costs are projected to reduce in the current financial year – if only because we did not follow the Honourable Mr Clinton’s advice. 

 

That is why the estimate for 2025/26 is lower than the estimate and outturn for 2024/25. 

 

Madam Speaker, in fact, the estimate also takes in to account a full payment of £10m from the Contribution to the General Sinking Fund.

 

Additionally,      we    estimate   that Departmental

Expenditure will be in the region £643.6m.

 

If we achieve that, it would be £31.5m less than the outturn for the financial year just ended, 24/25.

 

The reduction in estimate from the OUTTURN reflects what is, in our view, a prudent approach to spending whilst also providing for the contracted cost increases we already have in our sights.  

 

Despite that, in comparison to the previous year’s ESTIMATE there is an increase of £33.7m for 2025/2026. 

 

This is increase in the ESTIMATE, despite it still being below the OUTTURN, is due to the provision of additional funding in the following departments: 

 

Health and Care will receive an additional £17m.

 

Education will receive an additional £6m.

 

The Treasury will receive an £3.4m which will includes provision for the payment of the rental of the school buildings.

 

The Upper Rock Tourist Sites cost will increase by £2.7m as we share the increase in the ticket price and the huge increase in revenue with the private sector investors who are carrying the cost of the new facilities being opened to the tourists. 

 

Other increases are more widely spread across departments. 

 

As ever in all of this departmental expenditure, Madam Speaker, our Controlling Officers will remain prudent in trying to ensure that we spend what we need to spend but not a penny more. 

 

THAT is the policy of the Government. 

 

It may be worth saying now, Madam Speaker, that I will be laying a fuller report on the work of the Treasury which will also feature as an Annex to the written version of my speech.

 

GENERAL SINKING FUND 

 

Madam Speaker, I should also say a few words about the General Sinking Fund. 

 

In 2023/2024 I told the House that we offset our high borrowing costs by using the General Sinking Fund. 

 

Of course, Madam Speaker, this is exactly what the General Sinking Fund is for. 

 

Rainy day funds are only to be called upon when there is an urgent need and this was a classic example. 

 

The aim was always to pay back the amount used and re-establish the Fund as soon as possible.

 

Happily, I can report the House that in the just closed financial year 2024/2025 we have been able to contribute £7m to the fund. 

 

The positive effect that further reduction in interest rates will have in 2025/2026, and, of course the fact that we did not follow Mr Clinton’s advice on fixing the rates for our COVID borrowing, may allow us to make further contributions to the sinking fund during this financial year also. 

             

 

 

REVENUE 2025/26 

 

Madam Speaker we are estimating revenue for the year 2025/26 at £773.7m.

 

Again, that can be seen from page 1 of the Book for those following using that official tome. 

 

Yes, this is £40m below the outturn for 2024/25.

 

But, Madam Speaker, this is in line with our policy of not overproviding for revenue collection and estimating conservatively. 

 

Again, this is exactly in keeping with the approach we have taken in previous years to avoid a nasty deficit surprise.

 

I would broadly analyse the heads of expected revenue for the House as follows:

 

CORPORATE TAX RECEIPTS 25/26 

 

Corporate tax receipts are pitched to come in at £43m less than the outturn for 2024/2025.  

 

The sum we expected when estimating in March is in the region £213m. 

 

This reduction removes the exceptional £50m corporate tax collections but does take in to account a

slight increase for corporate tax receipts on the back of the increase from 12.5% to 15% which should begin to be reflected in this financial year 2025/2026.

 

PERSONAL TAX RECEIPTS 25/26 

 

584. Personal taxes are estimated at broadly the same level as the outturn at £260m.

 

IMPORT DUTY RECEIPTS 25/26 

 

The import duty estimate is also roughly in line with the outturn at £100m.

 

As Honourable Members will see when I deal with the measures, we expect very few changes in this area until the treaty finally comes into effect. 

 

TOURISM REVENUE 25/26 

 

The tourism revenue estimate is £4m higher than the outturn. 

 

This is mostly due to the said increased ticket prices and greater tourist flow anticipated – although, again, this was before the announcement of the agreement but we do not expect total fluidity to be established in time to have a meaningful effect this financial year.  

 

All other revenue streams are estimated on a very prudent basis and in lines with the outturn. 

 

This ensures that if we are faced with events negatively impacting revenue, we are not significantly over providing in a manner that might substantially throw our estimates off.

 

 

ECONOMIC GROWTH & THE GDP  

 

Madam Speaker, in order to make an assessment of whether the predictions we are making are likely to be met, it is also important to understand the broad outlines of economic landscape ahead of us.   

 

That will help us to see how the public finances themselves may fare in the remaining 9 months of this, current financial year. 

 

 

FINAL GDP ESTIMATE 22/23 

 

In order to do so, Madam Speaker, I can advise the House that  the final GDP estimate for financial year 22/23 has come in at £2.75 Billion, increasing by 8.3% or £210M.

 

I should add that after the retirement of Ms KellyFederico we have seen the appointment of a new, acting, Chief Statistician, Joelle Bonitch, who has taken on the role of preparing the statistics which are key to this debate and I thank her for her work in doing so.

 

 

PRELIMINARY GDP ESTIMATE 23/24 

 

The preliminary estimate for the GDP for 2023/24 is for £2.90 Billion, up 5.5% or £152M over the previous year.

 

This confirms that the strong bounce-back after the pandemic had set in as we had predicted.

 

Madam Speaker that continued the extraordinary performance, of our economy, growing 12.5% in the 24 months post pandemic.  

 

It reflects a period in which, in just two years, £360M was added to the size of our economy.

 

To an extent though, these are the figures that the House would have expected to hear, as they were trailed last year by me in respect of those years.

 

It is the next figure that I know the House will be most interested to hear, the forecast for the year just past.

 

 

GDP FORECAST 24/25 

 

So, Madam Speaker, I turn now to the more recent preliminary GDP forecast for 2024/25, that is the financial year which has just ended in March of this year – although March does now seem so, so far away. 

 

Madam Speaker the Statistics Office forecast for financial year 2024/25 is just shy of £3.1 Billion.

 

This represents an anticipated increase in the size of our economy of 6.5%.

 

That is an economic growth in cash terms of £188.23M in the size of the economy. 

 

This surpasses the pre-pandemic GDP estimate of £2.5%Billion in 2019/20 by 24% or approximately £600M added to our economy since then, with a pandemic in between.

 

That is, Madam Speaker, a remarkable recovery for which I congratulate every economic actor in our economy. 

 

Madam Speaker, the growth of the GDP in my time as Chief Minister to date is now confirmed as going from £1.1 Billion to £3.1 Billion.

 

An increase of £2 BILLION POUNDS in the size of our economy, with a pandemic, our departure from the European Union and an Emergency Budget thrown in.

 

That is growth of 181%.

 

Something to be proud of indeed in 14 years of Government. 

 

And certainly something worth the House keeping in mind when whilst we while away the hours listening to the Honourable Member’s opposite telling us how badly things are going.

 

Perhaps, they should consider congratulating us for the stewardship of the economy instead of simply trying to denigrate what we have done and what we do. 

 

But I won’t hold my breath, Madam Speaker. 

 

  

THE NET NON COVID DEBT & THE GDP RATIO

 

Finally, on debt, Madam Speaker, the non-COVID debt is now  well below £300 million.  

 

With the COVID debt to be provided for in a repayment agreement for £500 million over 20 years, the remaining Net Debt, which is reached after deduction of the £26 million in the Sinking Fund and the Cash Reserves of £185million, settles at approximately £160.5 million. 

 

At that rate, it is very low percentage indeed of our GDP.

 

The ratio of Net, Non Covid, Debt to GDP at £3.1 Billion is 5.35%.

 

That is not our measure of what is the right way to assess the affordability of debt, but it was the measure of Members opposite, especially when the Leader of the Opposition sat on these benches with the GSD.

 

Additionally, Madam Speaker, if we were to deduct the cash at the Savings Bank Reserve, of £83 million, the Net, Non Covid, Debt would be reduced to £77m.

 

That would leave us with a Net, Non Covid, Debt to GDP ratio of 2.5%.

 

That is the way that the GSD told us, Madam Speaker, from St Peter’s Chair, was the economically correct way to measure the affordability of debt when they too were borrowing through companies and not factoring into public debt.

By their measure, Madam Speaker, the Net, Non Covid, Debt to GDP ratio has never been lower. 

 

THE FULL NET DEBT TO GDP RATIO

 

Madam Speaker, from the above it is also obvious that the full Net Debt, with the COVID debt, also remains at what the GSD used to call ‘prudent’ levels as the right measure of debt. 

 

At approximately £660 million pounds, with a GDP of £3.1 Billion, the Net Debt to GDP ratio is 21%, which is very low level of debt to GDP by any measure.

 

If we reduce the Net Debt by the sum in the Savings Bank Reserve, as they would have done – and the Honourable Mr Clinton urges us to do – the ratio calculated by a full Net Debt of £577 million to the £3.1 Billion GDP reduces to 18%.

 

When we took over in 2011/12 Net Debt had reached about £520 million WITHOUT including company debt, as Sir Peter disclosed on the Leader’s Debate – leaving Mr Azopardi and me quite astounded. 

 

The Net Debt to GDP ratio was then 25% without a Pandemic or Brexit. 

 

So these ratios – both with the COVID Debt, at £577 million giving a ratio of 18%, or without the COVID Debt, at £77 million, giving a ratio of 2.5% – are a demonstration that we are lowering the Net Debt and that our mechanisms for debt management are working. 

 

 

THE GDP PER CAPITA 2025

 

Finally, when it comes to the GDP calculations Madam Speaker, and with all the caveats I make about this particular calculation, I want to give the House the annual GDP per Capita calculation. 

 

I have to insist, Madam Speaker, in our view that this is not a meaningful calculation and that it does not do anything for anyone who is struggling on a low income.

 

But this is a measure, however, that is often used internationally and it is a measure that the party of Members opposite started to report to the House.

 

Most importantly, it was a measure that they used when they were on this side of the House and it suited them.

 

It is for that reason that I continue to report it, even though I do so through the rightly gritted teeth of the Father of House, who agrees with me that this is a meaningless calculation. 

 

The GDP of £3.1 Billion divided per capita in Gibraltar, based on a pre-2022 Census population of 32,000 is £96,875per person.

 

Madam Speaker at the exchange rate of 1.37 US

Dollars to the £ Sterling, which is the current rate the GDP per capita of Gibraltar amounts to US$132,718, placing Gibraltar second in the world ranking below Luxembourg on US$138,634 per capita and above Ireland on US$106k per capita, Switzerland on US$104k per capita and Singapore on US$90k per capita.

 

The GDP per capita in the UK is US$52k and in Spain it is US$35k per capita.  The Euro Area comes in at US$46.8k. per capita and the whole of the EU at US$43k per capita. 

 

 

THE GDP TO TAX RATIO

 

We are also able to point to a lower GDP to tax ratio, Madam Speaker than when Honourable Members were in office. 

 

The ratio was 13.5% when we took over with a GDP of £1,082 Billion.

 

The financial year 24/25, Madam Speaker it is going to be 12.5% on a GDP of £3.1 Billion.

 

The GDP to Tax ratio in UK is of 32.7% and in Spain it is 36.6%.

 

These rights are higher than in Gibraltar by almost a factor of 3.

 

I do think it is worth always reminding our fellow Gibraltarians just how well off we are compared to others.

 

 

GROSS TRADING PROFIT OF COMPANIES

 

The Gross Trading Profits of Companies grew by 8.4% in 22/23 and by 5% in 23/24.  It has grown further in 24/25 by 9.8%.

 

Income from Employment increased by 7.5% in 22/23 and by 6.6% in 23/24 and by a further almost 4% in 24/25. 

 

 

REGISTERED UNEMPLOYED 

 

Madam Speaker, there is one measure that clearly reflects why our GDP continues to grow and why the strength and success of our employment strategy is having a real effect on people’s lives.

 

That is, of course, the number of people in our community who are not just seeking work but actually finding it.

 

And so, Madam Speaker, I am genuinely proud to inform this House that the YEARLY AVERAGE for Gibraltarians registered unemployed in 2024 was just 20.  

 

Yes, just 20.  

 

People. 

 

Not 20 PER CENT.

 

20 PEOPLE.

 

20 individuals.

 

Let that sink in.  

 

The comparable figure under Honourable members regime in the last quarter of 2011 was 442.  

 

This    figure      represents        a staggering     95.48% reduction in unemployment since 2011.

 

Remarkable and really worth shouting about. 

 

But more than that, we have not just reached that level, we have sustained it.  

 

Year after year we have sustained it, Madam Speaker.

 

And the fact is that these numbers demonstrate that this Government is delivering.  

 

Delivering real results for real people. 

 

Because the approach we’ve taken is not just working, it is transforming lives.

 

In the second quarter of this year, that success has continued, with unemployment remaining firmly on a downward path, even from what were already historically low unemployment levels.  

 

The figure for 2^nd Quarter average now stands at 19, marking a 96%reduction in unemployment since the 2^nd Quarter of 2012. 

 

These are not just numbers, these are individuals.  

 

Real lives that have been changed for the better.  

 

Madam Speaker, the House will be pleased to note that as at June 2025, unemployment stands at 16.

 

And Madam Speaker, this didn’t happen by accident, this is the direct result of focused, deliberate and sustained work.  

 

Low unemployment does not maintain itself. It takes consistency and commitment. 

 

Above all, it takes a Government with the will to deliver.  

 

It is the result of the dedicated work of the Government that I lead and under the  leadership of the Minister for Employment and the Director of Employment, the excellent Debbie Garcia.

 

Because Madam Speaker, we don’t just place people in jobs, we empower them to build careers. 

 

To pursue their ambition. 

 

To unlock their full potential.  

 

In doing so, we are not only supporting individual career aspirations but also strengthening Gibraltar’s overall economic stability and driving sustainable long-term growth.

 

Our ongoing commitment is clear, to maintain this momentum, we will keep delivering results, to ensure that Gibraltar’s employment sector remains strong, inclusive, and full of promise.  

 

That, Madam Speaker is the Gibraltar we are building and we will not rest. 

 

We will keep delivering. 

 

We will keep innovating, we will keep standing up for every worker, every business, and every opportunity that builds a stronger, more inclusive economy for all.

 

But it should not be lost on anyone in this House that when we started to reduce unemployment with the FUTURE JOB STRATEGY the member’s opposite criticized it violently. 

 

It was a constant refrain from them.

 

They called it a FAILED JOB STRATEGY.

 

They disrespectfully called people’s a pantomime. 

 

Well the only failure was in their ability to persuade anyone that our strategy was not the right one. 

 

The ring leaders of those chants decrying our strategy are gone. 

 

Sir Joe Bossano, who designed the Future Job Strategy is still here. 

 

The jobs are still here. 

 

But the lesson is to put the many and varied criticisms you will hear of us in the coming week, Madam

Speaker, in that context. 

 

The context of the empty complaints that seek only to politicise and not to genuinely analyse.

 

And on this, jobs point, Madam Speaker, I want to just end by saying this: behind the work on finding employment for our people that I have referred to today stands a team of public servants, dedicated, professional and tireless, who believe in the mission of public service and the results speak for themselves.

 

I want to thank all in the Employment Service for their brilliant work.

 

That is what Gibraltar deserves, and that is exactly what they  deliver.

 

 

EMPLOYMENT TRIBUNAL

 

Madam Speaker, we have also made meaningful progress in transforming how cases before the Employment Tribunal are managed, ensuring that claims are addressed more swiftly, more efficiently and within the fairness that those who seek justice rightly expect.  

 

And, Madam Speaker, I am delighted to report to this House that all historic cases have now been appointed a Chairperson. 

 

Every single one.  

 

That means the only claims currently awaiting the appointment of a Chairperson are those filed this year. 

 

That, Madam Speaker, is no small achievement, it is a significant milestone.  

 

It         demonstrates         that the   measures         we    have implemented are working.  

 

We have made the structural and procedural changes necessary to create a Tribunal that is responsive, effective and fully fit for purpose. 

 

We have created a Tribunal system that is flexible, modern and aligned with the needs of a dynamic, 21stcentury Gibraltar.  

 

And we are already seeing the results. 

 

Cases are now being dealt with greater speed, clarity and the fairness that every citizen deserves. 

 

Because that is what people expect from a modern justice system that works and under this Government, that is exactly what they are getting.

 

 

MINOR CHANGES TO ESTIMATES BOOK 2025/2026  

 

Madam Speaker, these is printer’s devil in the Estimates Book.

 

Subsequent to the printing of the estimates books we picked up one error in relation to incorrect reference to numbering. 

 

There is NO impact on the figures or the Bill due to these errors. 

 

One page would require replacing in the versions that have been presented to Parliament. 

 

Its page 205, were the refence to ‘Allowances’ in subhead is listed as ‘(29)’ when it should be a reference to ‘(19)’.

 

A copy of the revised page is being handed out to each member.

 

The version published online is already correct.

             

  

THE BUDGET MEASURES 2025 

 

711. And so, now, Madam Speaker, I turn to the specific Budget Measures that will apply in this financial year.

 

PERSONAL TAX RATES 

There will be no increase in personal tax rates. 

 

We committed not to increase personal tax rates in the lifetime of this Parliament.

 

We are delivering on our commitment. 

 

We lowered the rates last year, back to 25% as we have committed to do at the election.

 

We delivered on our commitment. 

 

We keep our promises.

 

We do what we say.

 

We will finance all the commitments we have acquired without an increase in rates of personal taxation. 

 

CORPORATE TAX RATES

 

Madam Speaker, there has been comment about the effect on our corporate tax rates of the agreement for an EU Treaty for Gibraltar. 

 

There will be none. 

 

Our corporate tax rates are out of the scope of the agreement for that treaty. 

 

We are committed to the OECD principles by our membership of the OECD.

 

We are in the OECD BEPS framework.

 

We are already acting in keeping with those principles. 

 

We had the first European register of ultimate beneficial ownership. 

 

We are white listed by the FATF – and we must ensure that we remain white listed.

 

And there is no effect of the treaty whatsoever on our ability to maintain our attractive corporate as they are, in keeping with international criteria. 

 

And so, therefore, this year, there is no change in our corporate tax rates.

 

The Honourable Mr Feetham, who I have charged with ministerial responsibility for taxation, will say more about how we will ensure compliance with our regime which can only remain attractive if it is complied with by those that are here to enjoy its benefits. 

 

ELECTRICITY & WATER TARRIFFS

 

Madam Speaker, since last year, we are showing each consumer by how much the cost of electricity and water is being subsidised by the taxpayers collectively. 

 

This year, on the first day of the financial year, water and electricity charges went up by 2.4%. 

 

Despite that, those modest increases do not mean that the consumers pay the cost of production of these utilities. 

 

We continue to subsidise water production by 9%.

 

We continue to subsidise electricity production by 43%.

 

That, Madam Speaker, is a historic feature of the cost of production for a small population. 

 

So, Madam Speaker, it is therefore important that the public should realise how important it was for us to be able to win the point in our negotiation with the EU that we should enjoy a specific derogation from the analogy of the Transaction Tax with the VAT Directive on the taxation of electricity.

 

We would otherwise have been required to announce today that electricity charges would be subject to an additional Transaction Tax of 5%. 

 

That will not be the case because we were able to prevail on that fundamental issue for us.

 

And it was particularly important given the cost of doing business in Gibraltar as well as the high cost of living in Gibraltar.

 

SOCIAL INSURANCE RATES UNCHANGED: ONLY THE CAP GOES UP 5% NOT THE RATE

 

The social insurance contribution system currently in place was introduced by the GSD when they were in office. 

 

It has an unusual feature in that contributions are kept capped at a level which results in employees with earnings above that level paying a lower percentage.

 

In fact, this year, and despite reports to the contrary, the rate of contribution is not being increased by 5%.

 

It remains at 10%.

 

What has been announced is that the cap will slide up by 5%.

 

But the rates stay the same. 

 

No one is paying more than 10% and I trust that this will clarify the position for those who believed that Social Insurance had been raised by 5%, when it has not been.

 

No one on the Minimum Wage will be affected. 

 

All that happens is that the stage at which one starts paying less than 10% is going up. 

 

 

Perhaps this would be a convenient moment, Madam Speaker to say that I am very grateful for the excellent work done by officials in the Social Security Department. 

 

The do deal with so many challenging applications. 

 

In our time in office, we have expanded the definition of disability from that which Honourable Members opposite insisted on, which required an individual to be born with a condition before they could claim benefits. 

 

Now there are 548 individuals in receipt of benefits. 

 

That is an 158% increase in persons in receipt of benefits. 

 

I will include a section of the Social Security Department in the Annex to my written speech which will also be laid today so that everyone can appreciate the excellent work done at the DSS by its great people. 

 

 

PUBLIC SECTOR PAY

 

I move on now to set out our position in respect of terms and conditions of employment in the public sector, including, of course, public sector pay. 

Madam Speaker, I will say this year as I say every year and as I have said to colleagues from the Unions who we have met to discuss public sector pay increases:

We will not borrow to fund pay increases for public sector workers or anyone else. Why?

Because of our foundational principle as a responsible socialist party and a key tenent of our alliance agreement with the Liberal Party. 

The Golden Rule.

This rule is as fundament for us as the Golden Thread is to English law. 

The key principle that we must be able to afford the cost of the public sector and all our recurring expenses from the income that we have today.

Madam     Speaker, as     I        repeatedly        tell    Union representatives who come with their member’s claims:

I will not ask my children, or their children for that matter, to fund my income today by paying for that borrowing when they are older.

That would not just be unfair.

It would be irresponsible.

I will not agree that for the purposes of increasing some already generous salaries, to add to the ability to fund luxuries, we should saddle our future generations with debt. 

I will, however, go out of my way to ensure that those who need to see their salaries increased do have an increase.

Because it is trite that inflation reduces the real money terms value of salaries for everyone.

But it is undoubtedly also true that the pinch is felt most harshly by those who are lower in the earnings scale.

So we do NOT agree, Madam Speaker, with the notion that a pay rise should be the same across the board.

We do NOT agree, Madam Speaker that the person who earns £150,000 should get the same pay rise as the person who earns £25,000.

I have been explicit in telling Union colleagues that we do not accept that position. 

To be clear, in the claims we have received from one Union, the claim, when analysed, could lead to some individuals receiving pay rises of £30 to £60,000. 

We do not accept that claim. 

In fact, I want to be clear, we reject that claim. 

I must say that I do not consider that is a claim based on any recognisable concept of socialism. 

So we will remain committed to targeting the bulk of the funding available to those who need it most and not on an ‘across the board’ basis. 

I know we enjoy the support of other unions in this respect. 

Additionally, Madam Speaker, we remain as fully, morally committed as political parties to the principle of

parity, as we are legally committed to the Parity Agreements of the 1970s.

That has long been a key principle of all GSLP and GSLP Liberal administrations, which I happily and proudly repeat each year. 

We respect and will continue to respect the UK parity agreements.

It is where we come from as a socialist party, in our foundation from the TGWU and one of the key legacies of the Father of House in his incarnation as a Trade Unionist. 

It is a key building block of our prosperity as against the area around us. 

And it is a key part of our link with Britain, in many ways. 

Madam Speaker, on this side of the House we are committed to the principle that our current and future generation of public sector workers must continue to enjoy parity with the UK as that helps everyone else in our economy, and, indeed, in the whole region around

There is no question about that and I am sure that all honourable colleagues not be surprised to hear that that, despite claims, placards and allegations, not one shred of evidence has or can be produced to show that we are not at parity, as agreed, between all Government employees when compared to their relevant UK analogues. 

As I told the House last year, to this end, entry-level salaries for all Public Servants were increased during the financial year 23/24 from £19,119 to £21,674.

Last year, in financial year 24/25, we similarly increased  that previously established £21,674 parity entry point to £22,874 for all relevant grades within the Public Service. 

Because, Madam Speaker, we in the Socialist Liberal party are always looking out for the interests of Care Workers, Administrative Assistants, Nurse Assistants, School Crossing Patrol Officers, Special Needs Learning Support Assistants, and many more roles aligned to this entry level scales.

They are NOT the lowest paid in our economy.

But the are the lowest paid in the public service and we are on their side. 

We are concerned to ensure that they get the support they need.

To be clear: for those who had started the financial year 23/24 on £19,119, they ended the financial year 24/25 on £22,874 have enjoyed a PAY RISE in the past two financial years of 19.6% - that is to say, just shy of 20%.

Well ahead of inflation in those two financial years, which was running at about 5.5%.

That is not bad. 

Should this entry level salary increase in the United Kingdom as a result of still the ongoing negotiation between the unions and the UK Government, then it will increase here as well to keep pace with the minimum in the UK if the effect of today’s measures do not already get us above that level.

In the UK, the current negotiations would suggest an entry grade salary of £23,809.50 (based on £12.21 an hour for 1,950 hours).

Additionally, of course, in 23/24 we provided the nonconsolidated Public Sector Support payment of £1,250 which really helped those on the lowest wages within our Public Services. 

Last year, we added that amount again – an additional payment of £1,250 but CONSOLIDATED into pay for the lowest grades and with other sums paid to higher earners.

Our key target is always the same: those who needed it the most.

And they will be our key target this year too. 

Inflation

And full payment of the public sector in Covid  

 

CONSOLIDATED PAY RISE 25/26

 

Madam Speaker, in the financial year 23/24 the Government introduced the Public Sector Support Payment which was a one off, non-consolidated payment of £1,200 for those on a basic pay of less than £50,000.

 

A sum of £900 was paid to those on a basic pay of £50 to £75,000.

 

And a sum of £600 was to t those on a basic pay of between £75 to £100,000.

 

In financial year 24/25, that is to say, last year, Madam Speaker, we paid the same amount but on a CONSOLIDATED basis.

 

We would all have wanted to do more, but the mood music, as one Union colleague described it in one of our meetings, was not quite right to do more. 

 

And, therefore, observing the Golden Rule required us to be very prudent in how we acted, whilst ensuring we gave something to those on the lowest salaries.

 

In some respects, little has changed in the past year.

 

I am sorry to say that there is still a war in Europe.

 

It rages no less intensely because it has been knocked off our screens. 

 

There is still a war in the Middle East.

 

In fact, that has got much deadlier in the past year and a tranche is subject to a ceasefire the lasting nature of which is as tenuous as the logical basis of some of the arguments we hear from members opposite. 

 

Additionally, Madam Speaker, the Government is also conscious, as the Chamber of Commerce has itself pointed out, that the cost of any increase salaries in the public sector would have to be met from recurrent revenue to keep to the Golden Rule.

 

The only way to ensure you can meet greater expenditure is to increase revenue. 

That can only happen with new revenue streams or increasing revenue streams from taxation. 

 

The Government does not believe it would be fair on private sector workers for them to see their taxes increased to pay more to public sector workers. 

 

Public sector workers would not like to see their own taxes go up in order to fund higher wages, as that would be robbing Peter to pay Paul.

 

Neither would the public sector unions agree to reduce the head count of the public sector in order to fund higher salaries for those who stayed in post.

 

As the Chamber put it, therefore, in their press release, a request for a 20% payrise is ‘outrageous’.

 

Two things HAVE, however, happened which represent a change for the better though. 

 

We now do have an agreement for a treaty with the EU – but we must temper that with the fact that we do not, however, have the ratified treaty yet.

 

Additionally, our surplus has, happily, exceeded our estimate by a factor of CCCC – going from an estimated surplus of XXX to XXX.

 

So, although we cannot throw our house out of the window, as the well-known, translated saying goes, we can try to put more help in the pockets of our lowest paid public servants. 

 

To once again paraphrase the terms of one of trade union colleagues, ‘the mood music is better this year’.

I confess, Madam Speaker, I think it is the only time I have seen Colin smile in the past 36 months.

 

But mood music does not translate to cash quite yet.

 

The Government therefore has to balance all of those competing criteria when determining how it is appropriate, if at all, to increase the cost of the public sector, which salary scales to increase, if any, and by how much. 

 

I know that all honourable members will have seen the recent press release by Unite the Union that set out the agreement it has recently reached with Mitie where Unite is welcoming consolidated, pensionable, pay increases of 5.2% for salaries at £25,000 and scaled down through the grades to an increase of 2.6% on salaries up to £50,000.

 

I congratulate Unite for that agreement, especially Brother Christian Duo who has successfully led that negotiation and with whom I have sparred and negotiated very successfully in the past decade. 

 

Indeed, Madam Speaker, it is worth noting that in the time since I was elected as Chief Minister, the Civil Service has seen salary increases of an average of 30%.

 

At the AA grade level, over 32%. 

 

At the AO grade level, almost 32%.

 

At the EO grade level, over 30%.

 

At the HEO grade level, over 29.5%.

At the SEO grade level, almost 28.5%.

 

And at the SO grade level, almost 27.5%.

 

The same is true of other analogous grades throughout the wide public sector.

 

Additionally, it is also worth claimants noting that there have been years when the pay rises I have delivered have been 10 times inflation.

 

For example, in 2014/15 inflation was 0.2%, but the public sector pay rise was 2.75%.

 

In 2015/16, inflation was 0.4% but the public sector pay rise was 2.75%. 

 

That demonstrates that we have been consistent in supporting the public sector with 

 

This year, therefore, Madam Speaker the Cabinet agreed on Monday, by consensus to my proposal that, in light of all of the above, the Minister for Economic Development and I, in my capacity as Minister for Public Finance, should finalise the terms of the public sector pay increase for the year.

 

The Honourable the Father of the House and I have met and considered all of the data, all of the arguments and I am therefore now able to announce the following:

 

Madam Speaker:  All public sector salaries will increase.

 

The increases will be weighted in favour of the lowest paid.

The minimum public sector salary will be increased from £22,874 to £24,017.70.

 

This will exceed the current UK Local Authority Pay Settlement and meets Unite the Union’s claims in this respect. 

 

Employees on salaries below £50,000 will receive a pay rise of 5%.

 

Employees on salaries above £50,000 and below

£80,000 will receive a pay rise of 4.5%.

 

Employees on salaries above £80,000 and below

£90,000 will receive a pay rise of 3.5%.

 

Employees on salaries above £90,000 and below £100,000 will receive a pay rise of 2.5%.

 

Employees on salaries above £100,000 will receive a pay rise on 1%. 

 

These payments will be consolidated and pensionable.

 

The total cost will be in the region of £8.8m distributed between all public sector workers. 

 

The bandings and thresholds are, in our view progressive and will afford payments almost the entirety of the workforce but will concentrate the highest benefits to the lowest earners in the public sector.  

 

This pay rise, is one part only of the claim submitted by Unite and NASUWT who have other aspects to their claims. 

 

I will deal with further aspects of the Unite claims in this address. 

 

The NASUWT claims will be addressed by the Minister for Education.

 

I would remind all unions, in particular the GGCA and Unite, not only have we been consistent in the delivery of pay rises when possible in the public sector – we have also been able to address many other, long standing claims which have been resolved in our time in office, not least the question of new hours for the Public Sector and family friendly hours. 

 

There are so many positive changes to terms and conditions in our time in office that it would take a morning just to list those. 

 

I know it is not necessary to do so. 

 

Madam Speaker, when we pass these Estimates with the Government majority, as the Opposition will vote against this pay rise and all aspects of these investments in our Community, we will start the process of filling the vacancies accepted as part of the complement. 

 

As ever, we expect they will say they are in favour of a public sector pay rise, but that they will vote against it!

 

PUBLIC SECTOR FEES & CHARGES  

 

Madam Speaker, the services public sector charges for must, of course, also continue to be charges, in real money terms, at the same rate each year. 

 

It is cheap politics not to increase our charges each year with inflation, whilst we increase our cost base.

 

If we do not do that, we do not keep pace with inflation and we just end up having to make bigger increases in the future in one fell swoop.

 

That is why, Madam Speaker, as we have done in previous years, and sticking to our salutary discipline on this, in terms of the services provided by the public service, as from the 1st of August, all fees charged by any Government department and payable to

Government, including licence fees and forms etc will increase in line with inflation estimated at 2.9%, rounded to the nearest half point, that is to say 3%, and in cash terms rounded to the nearest 50 pence.

 

Once again, this year these increases may represent a very minor cash sums, but this is an essential part of ensuring that Government fees do not, once again, fall to farcical levels. 

 

This is a discipline I commend to all future Ministers for Public Finance. 

 

THE CIVIL SERVICE & PUBLIC SECTOR

 

Finally, in respect of the Civil Service and the Public Sector, which I am very proud to continue to have Ministerial responsibility for, I am laying a fuller report on developments which will avoid my having to read that into the record this afternoon.  

 

It will include a part on the Department of Personnel Development.

 

It will be an Annex to the written version of my address, Madam Speaker. 

 

 

PROTECTING THE VULNERABLE

 

Madam Speaker, although inflation is down, a lot of the damage has already been done to many households. 

 

Ironically, apart from the price of oil, which is what tends to drive the upward inflationary pressure, few other prices tend to go down, and they tend only to go up. 

 

Prices that go up tend not to ever come down again. 

 

So, to do social justice, my Government will continue to act to protect the incomes of the most vulnerable.

 

And for those reasons, Madam Speaker, we will continue to ensure that those on the minimum wage, those on Disability Benefit and recipients of the State or Old Age Pension will once again all enjoy the benefit of increases in line with inflation to the payments that they receive.

 

We will also, once again, assist the lowest paid in the public sector.

 

I will each of those in turn.

 

 

THE MINIMUM WAGE  

 

The Minimum Wage will increase by roughly the same amount this year as it did two years ago. 

 

We do not want an economy of many low paid employees. 

 

We want an economy of many well-paid employees.

 

Given that inflation will be in the region of 3%, we want to give a real boost to the lowest paid in our economy.

 

The Minimum Wage will therefore increase by 60 pence to £9.50 per hour.  

 

That will mean that the minimum wage will increase by just over twice inflation. 

 

Madam Speaker, this is in keeping with Unite’s claims in this respect where the Union has sought an increase which exceeds the rate of inflation. 

 

We believe, Madam Speaker, that is undoubtedly the best way to ensure that the Minimum Wage in our economy does not seriously lag further behind the minimum wage in the Government. 

 

As a result, based on a 37.5 hour week, the Minimum Wage will go up from £17,355.00 to £18,525.00 an increase of £1,170.00 per annum.

 

Based on a 39 hours week, the Minimum Wage will go up from £18,049.20 to £19,266.00.  

 

This is an increase of £1,216.80 per annum.

 

As a result, Madam Speaker, those earning least in our economy will therefore enjoy the benefit of salary increases of in the region of £1,200.00 – which is the same sum by which the Minimum Wage went up in the financial year 22/23.

 

Once again, a real demonstration, Madam Speaker, that we are the party that really cares about working people. 

We are both the party that introduced the Minimum Wage and the party that always raises the Minimum Wage, each year, pandemics permitting. 

Madam Speaker, when we were first elected, the Minimum Wage was £11,559.60 and it is now almost £8,000 higher in 14 years.  

A further demonstration for all working people in our economy and to the Trade Unions that, despite what the  Members of the party opposite may say, workers are

ALWAYS better of with a Socialist Liberal Government.  

We believe, Madam Speaker, that there should be less and less individuals on the Minimum Wage. 

We therefore want to work with the Chamber of Commerce and the Federation of Small Businesses, the GBGA and the unions with representation in the private sector to address that. 

I am therefore forming the Living Wage Commission, with those parties, to be led by the Minister for Economic Development, the Honourable Sir Joe Bossano, to explore how determine what a Living Wage for Gibraltar should be and how new technologies can assist businesses to reduce labour costs so that they do not require so many workers on the Minimum Wage.

This also meets one of Unite’s claims that the Commission, which we promised during the election campaign, should be established.

Additionally, Madam Speaker, the Government will ensure that by the 31^st of December this year it has completely expunged the direct use by it of ZERO HOUR CONTRACTS other than in the use of Bank

Staff, which is an area on which we are agreed with the Unions that such contracts are the only way to contract for genuine temporary cover. 

This is also in keeping with Unite’s claim’s in respect of the use of such contracts in the Public Sector. 

I will also ask the Living Wage Commission to report on whether legislation is necessary in the private sector to properly control the use of Zero Hour Contracts.  

 

 

DISABILITY BENEFITS, STATE & PUBLIC SECTOR

OCCUPATIONAL PENSIONS  

Madam Speaker, of course, it will not just be the Minimum Wage that will go up by inflation.

The State Pension and Disability Benefit will also go up by inflation at 3%. 

The full old age pension payable, will now be £588.30 for a single person and £882.65 for a married couple

The Full Disability Benefit for an adult will go up from £485.55 to £500.15.

The Full Disability Benefit for a child will go up from £346.95 to £357.40.

Additionally, Madam Speaker, as the Father of the House has stated on the National Broadcaster on his recent, magnificent, hour long ‘Viewpoint’, work is now commencing to equalise entitlement to state pensions at aged 60.

As Sir Joe confirmed, and I had stated on my own ‘Viewpoint’ the day after the agreement was reached in Brussels, as we will not be aggregating for social insurance purposes with all the Members States of the EU in respect of Frontier Workers, we are now able to finally take this step.

We had long confirmed we would act when we had this certainty. 

We now have the certainty and act we will. 

Once again, this year, there will also be an increase for public sector occupational pensions which will increase by 2% in line with the provisions of Section 6 (2) and (2A) of the Pensions (Increase) Act.

 

 

STAMP DUTIES 

Madam Speaker, where there are genuine, inter vivos dispositions in cases of family reorganisations, there may be an argument for stamp duties not to be chargeable.

The difficulty is the possibility of abuse. 

I am therefore asking Minister Feetham and the Commissioner of Stamp Duties, together with the Commissioner of Income Tax, to report to the Cabinet in the next six months whether there is a possible mechanism to dispense with the payment of Stamp Duties on genuine family reoganisations inter vivos and which is not open to obvious abuse.

Their report will enable the Government to formulate an appropriate policy. 

 

IMPORT DUTIES 

Madam Speaker, given the agreement for a treaty with the EU, and the introduction of a Transaction Tax to replace import duties, it is not the Government’s intention to change the rates of duty applicable at this stage.

 

HM CUSTOMS

At this stage it may be worth pausing also to reflect on the work of HM Customs, one of the Department that I am proud to also have ministerial responsibility for. 

This year marks the 275 anniversary of that hugely important department. 

Given the structure of the EU treaty we have negotiated, the importance of HM Customs will be just as great going forward as it has been until now in our history. 

Although some locations may change in future, the work of Customs will need to continue unabated and I look forward to addressing the men and women of the department as we recalibrate how it does the great job that it does. 

As nomenclature and duty rates change, they will remain our gatekeeps and collectors for goods.

And the massive success that they have had and continue to have in the prevention of the entry of narcotic drugs into our jurisdiction is a role that has earnt them respect around the world.

In two years alone they have seized over 268 kilogrammes of narcotic drugs NOT destined for Gibraltar but seized and taken off the world market for the benefit of individuals beyond our shores. 

That role will also continue unabated.

But, additionally, it has to be remembered that – even when we have ratified and are applying our new relationship with the Single Market – there is no right to import illegal drugs into Gibraltar from the EU.

The guardianship of our goods frontier against the importation of illegal goods will continue to be as relevant tomorrow as it is today. 

A fuller note setting out the work of that important department will be laid on the table.

It will feature as an Annex to my written speech. 

 

 

DIGITAL SERVICES

The same will be true of the Digital Services Department, which is doing massively important work as we upgrade our digital services to enable our citizens to better interact with Government. 

A Gibraltar e-gov Membership Pass will soon be launched that will start to unleash the power of digital services for citizens in a way we have not seen until now. 

The men and women of this department are doing an exciting, important and brilliant job and I thank them for it. 

 

BORDERS AND COASTGUARD AGENCY

Similarly, Madam Speaker, and before I turn to the mechanics of the transaction tax, I want to reflect on the excellent work done by our Borders and Coastguard Agency, of which I am the Chairman. 

The men and women of the Agency do an excellent job and they will very much be required to continue doing it, in many ways exactly as before, when the new arrangements kick in. 

Just like with goods, the new arrangements will not permit individuals who are illegally in Schengen to enter Gibraltar. 

The new arrangements will also require different levels of enforcement, as now, and the BCA will continue to be our ‘go to agency’ for such matters. 

I look forward to addressing the men and women of the agency again and a fuller report on their work will also be laid and form part of the written version of my speech as an Annex.

 

THE TRANSACTION TAX

The Transaction Tax, when it becomes applicable, will start at 15% for the first year.

16% for the second year.

It will reach 17% in the third year.

A mechanism for an annual independent monitoring of actual market distortions which are a direct result of the lower standard rate applied by Gibraltar compared to Spain will allow for the rates to be increased or, indeed, reduced. 

So, for instance, if after the first year of application, the 15% standard rate is found not to create market distortions, it would be possible for Gibraltar to remain at 15%.

That will cover the bulk of goods.

Some goods will be subject to the EU’s so called reduced rate of 5%.

These will include children’s clothing, works of art, antiques and bicycles.

Some goods will be subject to the EU’s so called superreduced rate of 0%.

These will include food, supply of water, pharmaceutical products, medical equipment, books, newspapers and periodicals, solar panels.

Some other goods will be able to benefit from an outright exemption from transaction tax.

These will include:

the supply of fuel to vessels for bunkering purposes;

ship supplies;

the supply, hiring, repair and maintenance of equipment for vessels used for commercial activities; and

the supply of goods for the fuelling and provisioning of aircraft used by airlines operating for reward.

More generally, all goods imported into Gibraltar but not put for sale in Gibraltar will not be subject to the transaction tax.

Bonds will therefore be able to continue to operate either for goods to be exported or for goods maintained in Bond until put on the market in Gibraltar.

Additionally, electricity, which is considered a ‘good’ in EU law, will be included in the super reduced rate of 0%.

Excise duties will also apply to tobacco, alcohol and fuel.

Our commitment in this regard is to apply the EU minima. 

So, for instance, there will be an excise duty of a sum equivalent to EUR 115 per 1,000 cigarettes. 

Additionally, we will continue the practice of issuing a Gazette that will provide for the minimum retail price at which cigarettes can be sold. 

As I said already on Viewpoint on my return to Gibraltar from Brussels, this will mean that each band of tobacco will be no more than 15% or circa 80 cents of a Euro cheaper in Gibraltar than in Spain. 

Already, Spain’s own statistics suggest that the illicit market of tobacco from Gibraltar is 60% reduced.

This new mechanism for pricing tobacco should entirely eradicate that market, as the new arrangements will, in any event, permit persons to come and purchase as much tobacco as they wish for their personal consumption. 

The Government will nonetheless control the market to ensure it does not get out of hand.

We will change what controls are in place, but we may introduce importation quotas and controls.

We will also be establishing and providing funding for a Charity to promote the prevention of Smoking. 

These are the arrangements that were in place between Dover and Calais in the period of the United Kingdom’s membership of the EU. 

The methodology set out in the relevant EU directives will be followed to ascertain the rates for alcohol and fuel.

All of these rates will apply only from the date of coming into effect of the Treaty except for fuel which will benefit from a longer transition period of 3 years. 

Our law will require considerable reform and the Imports and Exports Act and the Customs Tariff will, in effect, have to be entirely recast, as these rules will apply, not through the treaty, but through Gibraltar law.

To be clear, in our dualist system of law, the treaty binds the UK as a state and Gibraltar as a constitutional part of that state.

In order to give effect to these new rules on the movement and taxation of goods, however, we will have to make new laws in this place.

That also, further, demonstrates the sovereign capacity of this Parliament, in the constitutional structure of the United Kingdom, to regulate the operation and taxation of business within our jurisdiction and control.

A hugely important part of the structure of the UK/EU treaty in respect of Gibraltar.

 

DATE OF FIRST REG OF 2^ND HAND VEHICLES FOR IMPORT

 

Finally, as we move into these new arrangements, our rules about the age of vehicles that can be registered in Gibraltar will need to change also. 

For that reason, from today, there will no longer be a restriction against registering vehicles in Gibraltar regardless of the date of first registration in the European Union – although, in lieu thereof, the EU’s rules in respect of restrictions on emissions will have to be adhered to instead. 

Our current rules as to date of first registration will remain in respect of vehicles from outside the EU.

 

 

CO-OWNERSHIP ESTATES

It has now been over thirty years since the GSLP started the principle of affordable housing, allowing for many Gibraltarians to purchase their first homes on a co-ownership basis. 

Since then, the share price for the co-ownership shares has been increasing annually at 7% per annum.

For homeowners whose underleases were issued over 25 years ago, and whose homes are still held on a coownership basis, Government will be allowing them the opportunity to purchase their entire remaining share at a 25% discount, so long as they do so between now and the end of June 2026. 

After this date, the share price increase will be calculated at market value in accordance with the provisions of the Trust Deed for each property, and not at the rate of 7% which has been applied to date.

Also, by doing this now, homeowners will get the chance to lock in those lower interest rates that the Honourable Mr Clinton did not expect to see coming. 

 

This will affect the following estates:

Sir William Jackson Grove

Harbour Views West View Park

Montagu Crescent

Montagu Gardens

Brympton 

 

 

THE ROYAL GIBRALTAR REGIMENT 

Last year, Madam Speaker, I told that House that the Government would create a system akin to the Scholarship for those who joined our armed forces in the Royal Gibraltar Regiment. 

The Government has recently made a statement in that respect which coincided with the 86^th anniversary of the Regiment of which we are all so proud.

Because, Madam Speaker, it is very well to be proud of our Regiment. 

But we have to act to ensure that our pride is not for a force that lives on only in the history books.

And that is why the Government has taken the step of creating that funding, linked to property in Gibraltar, for those who join and serve for defined periods. 

In that way we will be providing a real pillar for both recruitment and retention in the Regiment that will assist in ensuring it endures.

As at today, information is available on 65 companies, with a total of 777 documents published.

40 further balance sheets or full accounts submitted to companies house between 1st July 2024 and today

11 more will be sent in the next few days

This is something the opposition promised to do in 1996, but never delivered — publishing the accounts. 

The public will remember their leaflet promising this in 1997.

It has the Honourable the Leader of the Opposition’s picture on it. 

He sat with them in Parliament for 8 years and the failed to deliver. 

He sits with them again now, despite having helped us – and me in particular – to beat the GSD in the election in 2011.

Now we publish the accounts of our AND their company and still have the political cheek to say we are not doing enough. 

Not only have we done it, but we’ve gone further, releasing more information than they ever did.

We’re continue working on completing the audits of the years they left behind. 

In fact, after considerable effort, we successfully completed the audits for the years 2008 to 2012 for two companies we inherited — just last week. Gibraltar Investment         Holdings        and Gibraltar   Residential Properties Ltd or GRP as it is more commonly known.

A demonstration, Madam Speaker, of our commitment to transparency both in respect of our time in office AND their’s!

             

 

THE AGE OF MARRIAGE

Madam Speaker, in February of 2023 the United

Kingdom updated its legislation to provide for the better protection from the damaging impact of forced marriage by increasing the legal age of marriage to 18 in England and Wales. 

This has never been a live issue in Gibraltar where the legal age for marriage remains 16.

Recently, however, the diligent senior members of the CSRO, have noticed a marked increase in marriages involving predominantly girls between the ages of 16 and 18.

Whilst each case is rigorously assessed, it has become increasingly evident to the Government that certain groups are seeking to exploit our lower legal age for marriages.

As a result, I have given instructions that a draft should urgently be prepared of legislation to amend Section 15 of the Marriage Act to align Gibraltar’s legal marriage are with that of England and Wales, namely to increase the age to 18.

This will also require an amendment to the Children’s Act. 

I have given instructions that, as a matter of policy, no marriage licence should now be approved for any person under the age of 18 pending this Parliament’s consideration of that legislation when it comes before us. 

This is not a trifling matter. 

It is a matter than can affect the reputation of our jurisdiction and which can permanently blight the life of an exploited minor. 

Gibraltar will have no role to play in such abuse. 

This legislation will therefore be a priority for the Government and I am sure it will enjoy the support of all Honourable Members of this House.

Madam Speaker, I commend Karl Triay and his magnificent team for their diligence and alacrity in respect of this matter and all those they deal with. 

 

 

THE CSRO

This is an appropriate moment for me to update the House on the highlights of developments at the Civil Status and Registration Office – although it will soon no longer be called that. 

In fact, the Department will soon be rebranded, at the instance as the Department of Immigration and Home Affairs. 

I will lay on the table this afternoon a fuller report on the current CSRO which will address more of the excellent work that they do and which would extend the length of this speech unnecessarily. 

What is clear, Madam Speaker is that under the new EU Treaty, we are going to have to be more careful than ever about who wants to come to reside in Gibraltar. 

Becoming a Gibraltar resident will be of huge value to many, especially those third country nationals who might want or need to spend more than 90 days in the EU every 180. 

Our Cat 2 status will remain for all those who have it already.

But future rights to settle in Gibraltar will need to be more carefully thought out than ever. 

As a result, I am constituting a Immigration Criteria Consultation Committee that will be chaired by the Minister for Economic Development, who established High Net Worth Individual Status, or HNWIS as they were then known.

It will include the Ministers for Business and the Minister for Taxation as well as the Attorney General and the Head of CSRO.

Additionally, it will include subject matter experts from the financial services sector. 

It will report to the Cabinet before the end of November on how best to reform entitlement to residence in Gibraltar in future. 

 

 

EXTRAORDINARY MATTERS

Madam Speaker I now address a number of extraordinary matters before I conclude.

The first, of course, once again, has to be the ongoing cost of the McGrail Inquiry the cost of which the public will have to weigh against the value of it for our nation.

 

PURCHASE OF AQUAGIB COMPLETED

Madam Speaker, in the Budget Debate in July 2022, I announced that the Government had made the decision to exercise our de facto option to acquire all the issued share capital of AquaGib.

Last year I confirmed we had concluded the negotiation and the completion of the transaction for the acquisition of the shares would soon be entirely finalised.

I am very pleased to complete the record of my interventions in this respect by confirming that the purchase was completed in December and there is now full national control over the utilities. 

 

MCGRAIL INQUIRY COSTS TO 31^st MARCH 2025 

As last year, Madam Speaker, the McGrail inquiry costs are reflected in Page 2 of the Estimates Book.

The costs of the inquiry to 31^st March 2025 were £5.63M.

That is before the start of the renewed oral hearing required as a result of the failure by some parties to disclose documentation.

Since then, a further £6922,335 has been spent up to now.

As a result, Madam Speaker, the total we have all had to pay to date for the Inquiry that Mr McGrail called for is approximately £6.3M.

Last year, Madam Speaker, Madam Speaker, when the costs were running at just over £4,000,000 I said that I thought that the Inquiry had been and was being an extraordinarily expensive exercise for this community. 

I confess I did not expect the twists and turns that have added a third again to the costs!

Inquiries are obviously very good for lawyers, Madam Speaker.

Let’s just leave it at that for now.

Although it will not have been lost on those diligently doing their sums that the costs of the McGrail Inquiry

could have funded 3% more of a pay rise for the whole public sector in one year.

And that is just one of the much better uses to which we could have put that money. 

But the lawyers are certainly banking the benefits!

 

CONCLUDING REMARKS

 

Madam Speaker, as I now turn to the conclusion of this address and start to round up I want to start, where I do every year, by thanking all of the public servants of Gibraltar for their INCREDIBLE support these past twelve years.

I will never tire of saying that everything that I and my Government colleagues achieve is delivered thanks to them.

I particularly congratulate Glendon Martinez as Chief Secretary and Charles Santos as Financial Secretary for their work in this challenging year.

And, of course, I cannot fail to thank Michael Llamas for his remarkable, life defining work on the EU treaty negotiation.

The nation thought it owed him for the Eurovote case. 

We thought we owed him for the UEFA case.

Yet this was really the issue on which he would make his most incredible contribution to all our collective futures.

That will have to properly recognised by this House. 

Madam Speaker, I want to take the annual opportunity to thank you, the Clerk and ushers of the House for your fantastic Parliamentary support to me as Leader of the House in the past year. 

I extend my gratitude, of course, also to every one of my colleagues in my current ministerial team – although very especially to the Deputy Chief Minister with whom I have worked so closely.

 

Madam Speaker, the final drafting and ratification of the EU Treaty remains the most important current challenge on the horizon although the difficulty is reduced but not eradicated.

As ever, given the team that I have the honour to lead, I am sure we will deliver the final coup de grace to Brexit as a challenge to Gibraltar when we deliver the ratified treaty for our people. 

In this respect, I want to also single out the extraordinary work of Daniel D’Amato in Brussels during the ongoing course of this negotiation.

He really has been an incredible ‘on the ball’ support and I wish him and Sydney well for the imminent birth of their second child. 

As last year, Madam Speaker, I will not tire of repeating how blown away I am by THE most extraordinary dedication and the most incredible ability that Team Gibraltar represents. 

I am genuinely humbled to be leading Team Gibraltar, now for the fourteenth successive year. 

And nowhere is that team more impressive than at 6 Convent Place, in my private office, where Peter and Denise keep the logistics flowing and my contact with the community.

As many know, wherever I am in the World on business, Peter is with me. 

Whenever a community issue arises, Denise, Amy and Louise Anne are my eyes and ears to understand as well as my hands to try to help. 

And Susan, Georgina and Catherine are always ready to help to organise. 

And wherever I am, of course, Madam Speaker, you know that I am accompanied by Close Protection Officers of the Royal Gibraltar Police, who I also thank for their support this also extraordinarily difficult year. 

Madam Speaker, as Member’s opposite start to sharpen their verbal cutlasses to try and denigrate everything we do, they know that we know what they are going to say. 

The same old mantras the time proves wrong.

The same old broken records that sound off key. 

The same old hyperbole and exaggeration which does not bear scrutiny. 

Once again they will suggest that things are not going as they should in the GHA because we over spent – but they will ignore the fact that the person making the charge, the leader of the Opposition, over spent by more, as we have shown in previous years.

Once again, they will say that we do not manage our debt well, and probably call once more for a debt management plan – but they will ignore that the person calling for that plan was not planning properly and would have confined us to a massive extra cost.

Once again, one of their ‘always-aspiring but neverachieveing’ putative leaders will rise with vehemence to make the most vacuous points as if he were raising concerns of Biblical proportions – forgetting that they do this every year and that all the points are inevitably wrong.

Because every year we hear from them how badly things are going. 

Yet every year, the world keeps turning. 

Gibraltar keeps succeeding. 

We keep slaying the challenges before us. 

Look at what people have called limbo.

GDP growth of 6.5%.

Record government revenue. 

Record numbers of jobs in our economy. 

Record breaking gross trading profits in our companies.

And – most importantly – most of our people keep living lives that are the envy of Europe, let alone the world.

Yet all that, before we had reached an agreement with the EU for a treaty.

We expect even better performance in the future.

Since I first moved a Budget, they predicted that things would not work out as well under us as they would have under them. 

Now, with greater GDP growth, with an agreement for an EU treaty; AND having shown we made the right choice on interest rates…

They will still come with the same arguments, I have no doubt. 

They will still say they would have made better choices in the negotiation.

Which better choices, Madam Speaker?

That they – as the Leader of the Opposition has said – would have used the card of frontier workers better.

Relegating the people who work in our economy to deliver this success, as if just a playing card to be dealt.

Or his idea that agreeing to the tax treaty was a bad thing – although when we are removed from the Spanish blacklist, which is going to happen no imminently, he will try to ignore what he said. 

Just like on the huge mistake on interest rates.

Or the small mistake in opposing the increases to the upper rock ticket prices.

What is clear is that the mistakes are made on that side.

The leader of the Opposition presents himself as a safe pair of hands.

It’s clear he is more of a ‘butter fingers’ than a safe pair of hands. 

But for the next few days, Madam Speaker, you will have to hear the ‘same old, same old’ from them.

The usual recycled arguments, all over again. 

We will have to reply to them again, as effectively as we have before.

But we are clear that after this debate we will hit the ground running again.

We will be ready to continue the job the People want us to do. 

To deliver our manifesto. 

On our timetable, not theirs.

At our pace, not theirs. 

With them holding us accountable, of course.

But never allowing them to hold us to ransom. 

Reminding our selves that, as Mr Bossino said in a moment of lucidity and honesty of the type we don’t often see from him:

They see their role as being to attack us. 

Well, the would do well to remember that the People elected them to as opposition politicians, not as political rottweilers.

That look doesn’t suit them or go down well with a public that is looking for positive engagement from its political class. 

So expect, as ever, Madam Speaker, not just a challenge to our ideas in days to come. 

Expect, as ever, that despite no insults forming part of my perhaps in some instances BRUTAL analysis, we

shall, no doubt have to put up with being called many things by those opposite who present themselves as lillywhite and almost virginal in the political innocence. 

They will, instead, as ever, seek to wield the knife and drop the axe.  

As ever, I doubt it will even graze our skin as effectively as a careful, insult free analysis that shows that the decisions of one of their number would have already condemned us to £110m of extra costs and would likely have ended up costing us MORE than A QUARTER OF A BILLION POUNDS in our money being thrown away.

Bet that hurts more than being called a ‘Highway man’ the Leader of the Opposition sough to characterise me some years ago in one of his last gasp attempts to reach No6 by fair words or foul. 

But that will not divert us from our important work, Madam Speaker.

We will leave them to their insults, their barbs, their massaging of the figures to fit their theories of how badly we are doing. 

We will – just like last year - leave this place to do the things that the People want us to do. 

The things that the People have elected us to do. 

Because that is what we are in politics for.

To achieve for our People. 

To do for our People. 

To deliver for our People.

In all the public services we offer our People.  

In health.

In education. 

In elderly care.

In caring for those who earn least by raising the Minimum Wage. 

In looking out for those who work alongside us in the public sector and improving the lot of the least paid.

Delivering another annual increase to the state pension and the disability benefits. 

And that is how every year we show that we represent real social justice.

That we are the parties that represents the people in our economy who work hard every day. 

That we are the parties that equally represent those who cannot work at all.

And to show, once again, as we have unashamedly made it an aim of every one of our Budgets so far that we deliver for working people. 

That we deliver jobs for every Gibraltarian who wants to work.

At the same time as we ensure that those who cannot work are properly provided for. 

And that is what this Budget does again this year. 

That is what we ensure is how we spread the prosperity we in this Gibraltar with entrepreneurs and workers in equal measure. 

With a serious long term plan and a demonstrably better debt management plan than their.

Not to act in the short term interest. 

Not just attacking our political rivals for the sake of it and regardless of the damage to our nation, as they have done. 

We act always putting Gibraltar first. 

And that is what our plans do.

That is what our successful negotiation has done.

That is what our priority is and will remain.

Every time. 

And always ready to give nothing but the best of us each day to our endeavours on our people’s behalf 

That is what this Bill for an appropriation demonstrates from each of our departments and Ministries. 

And for those reasons and each of them, Madam Speaker, I entreat every Member of this House to support this Bill. 

Not to vote against the public sector pay rise or the payment of our doctors, nurses, teachers, police officers, firemen and all public sector workers. 

Not to stand in the way of progress for our people. 

But to vote with us to deliver this Budget for our people so that, together as Parliamentarians we can deliver to our people. 

Not to fall into trap, once again, of blindly following the advice to vote against the Budget designed by the man who would have cost us a QUARTER OF A BILLION POUNDS and in whom no one can ever have confidence again. 

And so, Madam Speaker, for all of the reasons I have extensively set out, I UNHESITATINGLY COMMEND THE BILL TO THE HOUSE.

And before I sit down, Madam Speaker, and given the length of my address, I would propose that the House should now recess and return at [TIME].

I trust the short recess will assist the Leader of the Opposition to take into consideration the things I have said as he prepares to reply so he can factor them into the things he says and not pretend, for another year, to ignore all of my remarks.

I move the House should now adjourn.