Thriving economy

A strong, dynamic economy is the foundation of Jersey’s prosperity. It is only through economic growth that we can generate the tax revenues needed to fund essential public services, handle the consequences of an ageing population and maintain the high standard of living that Islanders rightly expect.

Jersey’s economy is heavily dependent on the financial services industry, which accounts for 45% of economic activity and around two‑thirds of total tax revenue. No other sector comes close to generating the same level of economic value or tax contribution per head. The success of this industry over many years has funded public services that would otherwise have required significantly higher rates of taxation.

However, the continued success of the financial services industry cannot be taken for granted. The recent financial competitiveness review, including the report of the expert panel led by Sir Howard Davies, made this point with great force. The panel warned that the sector faces existential threats from intense global competition, rapid technological innovation and increasingly market‑sensitive regulation in other jurisdictions. Their conclusion was clear: without urgent intervention, Jersey’s future success as a financial centre is at risk, with inevitable consequences for the Island’s way of life.

The panel also highlighted the need for a fundamental change in mindset. For too long, Jersey has operated on the assumption that it is a privilege for international clients to do business here. That is no longer the case. The privilege has shifted. Jersey must now work harder to retain, promote and grow its financial services industry. There are many more options available to mobile financial services businesses, and Jersey must compete for them.

This requires a change in culture, policy and regulation across government, its agencies and industry. Within government, it means refocusing policies and practices on growth, with buy‑in across all departments. I am committed to ensuring that the recommendations of the Time to Win report and the expert panel are implemented in full.

At the same time, Jersey must diversify its economy. While financial services will remain the cornerstone of our prosperity, reliance on a single high‑value industry carries risks. Agriculture and tourism have played a central role in Jersey’s economic history and continue to contribute to the Island’s identity and social fabric. They deserve continued support and a regulatory environment that enables them to thrive rather than imposes unnecessary burdens.

Jersey also has significant potential to attract high‑value technology-based businesses. Our low‑tax environment, excellent communications and good quality of life make the Island an attractive location for digital entrepreneurs. The financial services industry provides a strong local customer base, and the professional services sector offers the necessary support. But competition from other jurisdictions is intense.

To succeed:

• Government must become an exemplar in the use of technology. Too many government processes remain analogue in a digital world. The tax office is one of the few organisations in Jersey that still makes payments by cheque.

• Immigration and housing policies must be reformed to attract people and businesses capable of bringing substantial revenue to the Island.

• Investment in innovation needs to be substantially increased. Jersey currently spends only 1.1% of national income on economic development, compared with 3.9% in the UK. We need a shift towards targeted investment in innovation and skills, supported by a clear strategy to maximise impact.

Finally, the Government must change the arrangements for social security contributions, which currently penalise people moving from high paid employment to self-employment or part-time work.