The Budget Crisis on the Isle of Wight and the Political Demands on the Government:

The view of the Trades Council regarding the budget crisis for the Isle of Wight and the political demands on the Government regarding funding and the call to treat the island as a special case.

In the first place the main onus should be placed upon the Government and not the council. Preparing a legal balanced budget is now outside the possibility of the Council and management of the crisis, caused by Government funding, is not the priority it has been. Raising Council Tax is not the solution as it ameliorates some of the effect of the cuts in grants by taxing the people who are squeezed enough already and does not provide a solution. The negotiations with the government should be firm and not apologetic or offer “concessions”.

Engaging with Government (The Trades Council view)

· The business rates system as pointed cannot assist the island as it proposes to do elsewhere because of the low economic and business rate base here. It highlights a specific factor that makes the Island unique in the resource impact it has.

· The island has a low wage economy.

· It has a large area of deprivation comparable with other districts mainly in the north of the UK.

· It has connectivity problems and other economic restraints caused by the fact that it is an island. It causes problems when travelling by expensive ferries to the mainland to work or visit families.

· It receives poor responses in funding from the SLEP because of European and Government criteria that de-classifies it as an island with contiguity.

· It has housing problems specific to being an island

· The Isle of Wight has an above average older population and a wider impact on the health economy on the Island

· It has NHS issues unique to being an island where people have to travel to the mainland for treatments that the island NHS cannot deliver.

· It has notorious problems in education investment and teacher recruitment due to the fact it has island problems.

· It has additional expenses due to PFI and maintaining the road system.

· It has specific coastal erosion problems caused whenever there are natural disasters like flooding.

· Introduction of some form of visitor tax to protect services which underpin the visitor economy is impractical and against the tourist industry.

· Any negotiation should not include alteration to criteria to better reflect the Island’s separation from the mainland in the allocation of Government funds for business growth and support by Local Enterprise Partnerships. The funding path has proved to be ineffective in terms of Assisted Area Status and other funding streams. The Government cannot provide any guarantees or substantiate any promises that it would alleviate the general grant cuts crisis and should not be part of talks with the government over the budget.

· Nor should support of promises for business start-ups be part of the discussions on the budget.

· National concessionary fares being limited to island residents and not visitors or an additional specific grant to cover visitors, penalises visitors who may be tourists or relatives or visiting cultural delegations. We do not think that this limitation is the right way to go.

· Business rate retention scheme should compensate by top up grant based on a higher threshold that reflects a south-east increase in business rate growth.

· Providing assistance in bringing derelict tourist sites back into use is a specific issue relating to budget investment and should be raised as a specific problem unique to tourist resorts.

· Creating greater competition in the Island’s adult social care market is not a solution to the care problem. The Trades Council believes that it is not the way forward to privatise adult and social care. Adult and children’s services overspend, as it is there is no prevention policy. In the context of the general service cuts, if income is taken away because people can’t work and other social fabric problems, there is an increasing need for adult and social care, which thus creates more people who are vulnerable. Adult Social care cost estimates at £2,100,000, with £1,800,000 care packages, require added government grant funding.

· Children’s services and social care activity levels are very high on the Isle of Wight. The budget costs calculated at Children’s Services £360,000 (Residential/secure placements and fostering), points to high proportionate amounts in comparison to elsewhere and require additional Government funding. Child poverty on the Isle of Wight is massive and higher than most areas.

· Introduction of a services delivery top up grant on the same basis as the rural services delivery top up grant that supports areas with similar characteristics.

· Devolution is a concession to Government and not a solution. The Trades Council does not believe in a devolution deal with Hampshire and the Isle of Wight. It will not reduce Council taxes and will not be cheaper due to “efficiency” changes and removal of Island rights and democracy. It should not be offered as a bargaining chip to Government and should be left out of discussions over budget.

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