By Robert Vasquez
Many, including the GSD Opposition, write and speak about the issues of Gibraltar’s unaffordable public finances and overloaded public borrowings.
It is time to hear solutions, or at least ways forward, but no one in politics today, not least the GSD, proposes a way forward or way out.
The alternative is the end of democratic politics as we know them today, due to the financial mess that we face.
HEADS IN THE SAND
The GSLP-Liberals pretend there is no problem by, as admitted by Sir Joe Bossano, playing with the figures to hide the true picture of deficits from voters.
Their leader, Fabian Picardo, has said he will move on during this term of office, so soon he will be out of the reach of blame.
The GSD highlight the public money nightmare (see my blog of July 3 at www.gibnews.wordpress.com) yet put forward no policies to resolve it but have an ambition to be elected to government.
Is that to inherit the problem or to find ways out of It? Go on, be a devil and say which.
DESIRE TO BE ELECTED
Could it be that current Gibraltar electoral political thinking is that it is best to stick one’s head in the sand, and pretend all is good to get elected?
It certainly looks that way, motivated by greed for power, and perhaps the jewel of a knighthood at the end.
Clearly, the obligation to be responsible for the common good seems to be forgotten.
GSD VOID
Alternatively, is it because the GSD doesn’t have any ways out?
Or is it because the needed policies are so unpopular that one would not be elected to government if one preached them? In that scenario, the lust for power beats the common good that those aspiring to be our governments should have as their objectives.
It is a sad situation reflected by the resistance that both the GSD and the GSLP-Liberals have had whilst respectively in government to reform the electoral and parliamentary systems to ensure ‘peace, order, and good government’ for the benefit of as many as possible.
NO SOLUTION
The reality is that no solution, or painful way forward, to Gibraltar’s obvious state of near bankruptcy, comes forth from either dominant political party shows the nihilistic state of politics.
It denies reality and lives on in an imaginary parallel universe.
In the end those who have caused the mess, namely the governments in power that spent and borrowed more and more, will not be blamed.
The blame will fall on whoever is in government when the ‘proverbial’ hits the fan.
WHAT WILL GSD DO?
The question then is who the heck wants to be in government when that happens? It seems that the GSD do, as it does not highlight policies that may prove unpopular at the ballot box but would save them from blame.
The GSD continue to walk towards the cliff edge.
The GSD should take some advice. It must put truth and reality into the public domain.
It must answer the question, what will it do in government to put right what its Leader, Keith Azopardi, and Roy Clinton, Shadow Minister for Finance, so eloquently said was wrong in their Budget speeches this year.
WAYS FORWARD
There are ways forward, albeit no absolute solutions, and even those ways forward require UK agreement and support. We are not self-governing to the degree that our elected politicians would have you believe that we are.
If by putting out the truth of what the solutions entail means the GSD does not get elected good for it.
Those who made the problem will be elected and will be rightly blamed when reality forces them to do the necessary in contradiction to airy fairy promises made in election manifestos.
The GSD or any alternative force can then ride in on the crest of reality and do what is necessary to put Gibraltar on the right road to recovery.
WHERE TO?
Outright solutions to public finances will take decades, for example paying down the £500 million Covid loan over 25 years (were that to be agreed by the UK government) will cost £20 million a year plus interest. That will be a huge financial burden but less than the alternative.
The alternative does not bear thinking about. It is that loan must be repaid within the current three-year loan period. The impossibility of that is plain to be seen, yet the current GSLP-Liberal Government agreed it.
25 years is chosen because it is the term of years publicised by GSLP-Liberal Chief Minister Fabian Picardo that may be on the cards. One assumes that it is not a figure plucked out of the sky by Mr Picardo but rather one arrived at following discussion with the UK government.
WALKING WITH THE UK
Reality will require that we walk together with the UK. It will need to be asked to find us the time to dig ourselves out of the money hole that past recent governments have put us into. It has happened over a prolonged period.
The likelihood of added loans or guarantees for more public borrowing being forthcoming from the UK seem small, especially, in the context of the UK central government policy towards its own bankrupt local governments.
Hopefully, any UK support will not come with unacceptable international conditions engaging the EU/Spain (see my blog of July 15).
WAYS FORWARD
The alternative ways forward are narrowed down to two, but both have commonality in the face of either Gibexit outcome. There is a crying need to cut spending, and there is an urgent need to enhance revenue in the face of either there being a Gibexit treaty, or there being ‘no deal’.
In the latter case, ‘no deal’, the first alternative, cutting expenditure, will become paramount, as the second alternative will be replaced by a reduction in economic activity. Therefore, the public spending savings will need to be bigger and so will hurt more. The hurt of spending cuts will need to be absorbed in any event.
Cuts will affect many, some more than others, especially those in public service, but there is an inevitability about the need for those considering the current state of Gibraltar’s public finances.
The need to enhance revenue means increasing taxes and duties. Those increases must fall on residents and those employed in Gibraltar. We cannot afford to lose the advantages used to attract business and economic activity to Gibraltar. In fact, it may be necessary to find more.
Tax arbitrage for companies has always been one way that our economy has been encouraged. We will likely need to return to those days were there to be a ‘no deal’ outcome. EU restrictions on such activity will not exist in that eventuality.
CROSS-FRONTIER WORKERS
The harsh certainty is that we need cross-frontier ease of movement to help our economy. The boast that if the EU imposes cross-border restrictions on movement of persons, we will apply equal restrictions is an empty threat.
First it is no skin off the nose of the EU/Spain. Second, we are cutting our nose to spite our face, because we need those visitors/tourists to support the economy.
Third, cross-border workers need that ease of travel to sustain their employment in Gibraltar, which again is a must for Gibraltar.
Gibraltar can provide that ease of travel to cross-border workers even if there is ‘no deal’.
TIME FOR THINKING
The time has come for collective thinking to find ways forward for our economy and public finances that will benefit all in any current eventuality.
There are a few ideas above, but the reality is that it needs many to put on their thinking caps. The political doldrums, based on resting on our laurels, that we have been in for years must end. They have taken us to the very bankrupt place that we find ourselves in today.
Will the GSLP-Liberals and GSD hit the wall? Will we all suffer the end of democracy as we know it? Will it be the end of the road to self-determination?
Certainly, our Government and Opposition blindly walk on. There again, they may be right, after all, I have always been dubbed ‘doom and gloom’. Certainly, I hope I am wrong, or at least that what I write will encourage a change of direction in how we govern ourselves.
Robert Vasquez, KC, is a retired barrister and political commentator. He stood as an independent candidate at the last general election on a platform of democratic reform.