Sir, I will start with an update on the States’ five agreed super priorities, followed by updates on External Relations, MyGov and the Revenue Services Recovery Plan.
Next month the States will discuss the 2026 Tax Reform Package – the first and most pressing of our super priorities. It will be a debate about the future of our islands, our community and our economy, to put our public finances on a stronger and more sustainable footing.
The Committee is acutely aware of how much some people are struggling – whether they’re working full time or retired; whether they rent or pay a mortgage, and whether they have young children or older loved ones to care for. We’re also keenly aware of the need to provide the services and infrastructure the islands require, now and in the future, in the context of a worsening dependency ratio and reserves that could be completely exhausted by 2031. Finding a way to raise more revenue for essential services whilst also protecting those who are financially vulnerable has been a challenge, but the 2026 Tax Reform Package meets both aims in a measured and manageable way.
This package is a balanced, pragmatic and proportionate response to the financial challenge we face. It will improve our financial position by £59m a year, including the £20m of expenditure reductions agreed by the States and £39m of additional revenue. By sharing the burden between savings and taxation, this package provides a credible way to close the funding gap – crucially enabling us to protect essential services whilst also investing in our future.
There are still some unanswered questions around future sources of revenue such as from offshore wind, Pillar 2 and economic growth, so we’ve designed in an opportunity to take stock of the financial situation when there is more clarity on those and other issues. The next States can look at that wider economic picture, as well as the savings and revenue generated by the measures in this package once they’ve been put into practice, so that a decision on the longer-term trajectory is firmly evidence-based.
The Island’s financial position is worsening long term as demand for healthcare in particular rises, but our current position allows us to phase changes more gradually, reducing the immediate impact on our community and economy. We’ve also listened carefully to feedback on the previous tax package agreed by the last Assembly in 2024 and have responded to those concerns – reducing GST to 3% to help limit the impact on the cost of living and allowing more time to assess the potential impact of changes to social security, for example.
Importantly, the 2026 Tax Reform Package reduces our over-reliance on income-based taxation, giving the majority of people a significant tax break in the process – even after GST is taken into account. This strengthens and diversifies our tax base in a way that raises more income from a wider variety of sources whilst also reducing the burden on those that can least afford it.
Work continues on Leale’s Yard: clearing the site and starting its development is another of the States’ super priorities for this political term, and planning approval has been given for the first phase of demolition.
This will involve demolishing several buildings on the Bridge frontage as well as the other buildings on the site down to ground level. A new temporary access to the site will be created off the mini roundabout so that heavy vehicles can avoid the area immediately in front of the shops. A contractor will be appointed in the coming weeks.
While the first stage of demolition takes place, site investigations will also be carried out to prepare for a further stage of demolition, which includes the removal of building slabs, contaminated soil and below ground obstructions, the capping of utilities and more, all to provide a flat and safe site that is ready for future development. Master planning expertise is also being engaged.
While the land purchase of Leale’s Yard was agreed in the previous political term, in response to some inaccurate public commentary, I will take this opportunity to advise the Assembly on some of the facts.
The States purchased a majority of the site in August 2025 for £4.5m - less even in nominal terms than the £4.65m that Channel Islands Co-op bought the whole site for back in 1998, which index linked would be close to £9m in today’s money. It was a strategic purchase of a site that has sat empty and derelict for decades, so that we can revitalise the area, build much-needed homes, and provide economic opportunities and more recreational facilities and green spaces for islanders – particularly in the context of the two adjacent sites that all together provide a unique opportunity to make a sizeable and significant difference. After more than quarter of a century of frustrating lack of progress on this site, I very much welcome the activity that we can soon expect to see there.
The work to agree and advance a sustainable health and care model is rightly being led by the Committee for Health & Social Care, with P&R in a supportive role. My understanding is that work is being carried out to establish the baseline service and financial metrics as the first order of business.
As the sponsoring committee co-ordinating the work to shape and strengthen the focus on early years and families, our initial focus has been on scoping and putting in place the building blocks. We have agreed an outline brief, reallocated internal resource to lead the work, re-deployed in-house key subject matter expertise and engaged with external stakeholders and partners in this area. We are also bringing some dedicated legal resource on board.
This is very much a cross-committee piece of work and it's complex, so as part of an integrated approach, the relevant committees are represented on a political oversight group, which I’m pleased to be chairing. The programme is still in the early stages so I’m looking forward to providing further updates as it progresses over the next six months.
At our meeting a fortnight ago, the Committee considered a detailed paper in respect of the work to determine and design future harbour requirements. Having updated extant work and considered the input of the Guernsey Development Agency and a report on operational matters provided by the Ports of Guernsey, the next stage is a comprehensive economic and strategic analysis – for many, the missing piece of the jigsaw needed to make the necessary strategic decisions.
The Committee is looking to work closely with the States’ Trading & Supervisory Board and the Committee for the Environment & Infrastructure and is aiming to bring a policy letter to the Assembly next year.
The Bailiwick Commission was officially formed in March this year and has now begun to do its work. It consists of five independent experts with relevant experience, who by design are all external to the Bailiwick.
The Commissioners visited Guernsey, Alderney and Sark in April, with further visits planned. I was pleased to hear so much positive feedback from their engagement so far and I look forward to reading the Commission’s interim report in the autumn. The Bailiwick’s community, local organisations, governments and businesses are all being encouraged by the Commission to follow, participate in and contribute to its work.
Work continues to seek to include Guernsey in relevant parts of the UK-EU Reset. Bailiwick students who are studying at UK universities and other higher education settings will be able to participate in Erasmus+ again – that has already been announced. We are also investigating how the Bailiwick’s young people could be included in the proposed Youth Experience Scheme to allow easier access to work, study and travel in the EU and to allow EU youngsters to come to our islands for the same purposes.
In May 2025, the UK and the EU agreed to form a Common Sanitary and Phytosanitary area under an SPS Agreement, to allow the easier movement of foods and products of plant and animal origin. We are seeking inclusion of the whole Bailiwick in that agreement and the UK Government has confirmed that this outcome is a high priority. The negotiations are reaching their final stages. The Agreement is due to take effect in 2027, so we will ensure that businesses in the agri-food sector have the information they need to prepare in good time.
Turning to organisational matters now, I am grateful to the Chief Executive & Head of the Public Service for the work that is being undertaken on two critical issues – the MyGov project and the Revenue Service Recovery Programme.
The MyGov report starkly underlined the importance of getting the fundamentals right: leadership, culture and delivery. The Chief Executive has committed to strengthening these foundations so that our major projects, and the public service more broadly, are better set up for success.
This starts with how we oversee and resource our most important projects. Too often, problems come to light too late. We need to catch issues earlier and deal with them properly before they grow. This is going to require a more hands-on and realistic approach to how projects are run.
At project level, the leaders need enough time to do the job well and give it the attention and energy genuinely required. And at a portfolio level for capital projects, we need that healthy scepticism: people willing to ask the difficult questions and challenge assumptions before issues take hold.
This will also be supported by the appointment of a voluntary Portfolio Board Advisor. We received twenty applications, which really shows the depth of skills and experience we have across the community. This role will bring an independent perspective and some constructive challenge to how the portfolio is managed.
Alongside this, we need to be honest and transparent about how the portfolio is performing. The first six‑monthly report is due out in the next fortnight: it will give a clear picture of where projects stand, what’s progressing well and where there are challenges. That’s an important step in improving accountability and building confidence in how these major investments are being handled.
At the same time, the Chief Executive is also taking forward the wider changes the MyGov report pointed to. He is working directly with a number of committees on the move to a chief officer model, and is due to speak to all States members next week. His objectives will be published in July as part of his mid-year review. This will include a clearer picture of operational performance and the progress being made to strengthen how the public service delivers.
When it comes to the Revenue Service, we know that many customers are still waiting for assessments, repayments or responses to enquiries. We are sorry for the frustration and uncertainty this causes. While service levels are certainly not where we want them to be, the position today is materially stronger than it was a year ago.
Following a comprehensive review of outstanding work, we have, for the first time, clear visibility of backlogs, demand and operational pressures across the service. This gives officers the information needed to prioritise work effectively, target resources where they will have the greatest impact and deliver recovery in a planned and controlled way.
We are at last at a genuine turning point. Officers are no longer focused on understanding the scale of the problem; they are actively addressing it. Recovery will not happen overnight, but we now have the visibility, governance and control needed to make steady and measurable progress.
Recovery activity is already delivering measurable results. Since March, over13,000 work itemshave been processed, including the clearance of approximately 3,000 outstanding repaymentsidentified at the end of February. The backlog of older personal tax cases has reduced by around 30%, debt recovery activity has restarted in a structured manner,bereavement caseshave been fully triaged, and more than5,000 customershave already benefited from recovery actions.Assessments for 2024will bereleased in acontrolled and phasedway to ensure that any resulting repayments can be processed promptly and customer demand can be managed effectively.
While this progress is encouraging, recovery will take time. This is not a single backlog that simply counts down; work continues to enter the system every day while historical cases are being cleared. Some queues reduce steadily, others generate follow-on work, and recovery must be delivered alongside the Revenue Service's ongoing statutory responsibilities. This is a phased recovery, not an overnight fix. Customers will see continued improvement, but not in every area at the same time.
Alongside backlog reduction, work is underway to improve the systems, processes and data that support the service. This includes data cleansing, system improvements, greater automation and process redesign, all aimed at increasing efficiency, reducing manual effort and preventing similar issues from recurring in future.
The first phase of the recovery plan, which is ongoing, focuses on stabilising the service, reducing backlogs and restoring timeliness. The next phase will focus on longer-term transformation, future-proofing so we don’t find ourselves here again, by looking at how the Revenue Service itself works and considering automation, process improvement and digital enhancements, creating a more resilient and sustainable service. The objective is a stable, predictable service operating within clear and reasonable timeframes.
One of the consequences of the system challenges at the Revenue Service has been that the Data & Analysis team did not have the data necessary for various national statistics to be produced and published – a problem that started in late 2024. We are now in a better position: data can and have now been provided for national statistics since the start of June, although there are still some complexities to work through. In addition, the rolling electronic census IT system needs to be adapted so that it is ready to automatically process the data it receives from the new Revenue Service system. The Committee will soon be able to confirm a timetable for the publication of fully up-to-date national statistics so I will keep the Assembly updated.
This gives an overview of some of the main work P&R has been focused on since the last update, but I look forward to questions on any area of the Committee's mandate.
Thank you.