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Brexit concerns overshadow record budget result
before the 23 June last year could remain on The Rock, and Gibraltar would mirror the UK’s position on acquired rights of EU nationals established or working in Gibraltar “before the final cut off date that might be agreed between the UK and the EU”, and it would support determination by the European Court of Justice “in any disputes affecting this class of EU Citizen.”
But he held: “If the UK and the EU enter into new, post-Brexit, trade arrangements in future which extend rights to EU nationals arriving into the UK to establish themselves or to work after the UK has left the EU, those arrangements will not apply in Gibraltar if the [Spanish veto] excluded Gibraltar” from any such arrangements.
Limit to job rights
Picardo emphasised: “Any new Spanish or EEA nationals entering the job market after the 29 March 2019 will – as things currently appear to stand – enjoy only the generous rights enjoyed by those who are today third country nationals.”
Employment rose 3.6% to reach 27,073 by October 2016 (the latest figures available), of which 11,065 were Gibraltarians, leaving fewer than 200 locals jobless. Strongest employment gains were in the private sector – up 4.5% to 20,977. The
the minimum wage is being raised by 17p (2.7%) to reach £6.45. However, “the larger the job market, the greater the opportunity for abuse”, suggested Picardo, who leads a socialist and liberal political alliance. A working group involving Unite the Union and employer representative bodies is “to establish principles for Trade Union Recognition in the Private Sector”.
Conservative assessment
Inflation stood at 1.5% in October 2016, but averaged 2.6% in 2017, compared to 0.25% a year earlier, “largely the result of rising import prices from the fall in sterling since the EU referendum, together with the higher global price of fuel”.
Revenue in 2016-17 was £63m higher than budgeted at £615m, with income tax of £154m contributing £5m more that expected and corporate tax around £31m more at £135m. For the current year, the surplus is £18m, “a conservative assessment of what we believe is achievable”. Estimated recurrent revenue for the year is budgeted to increase over £24m, or 4.1% over the previous year’s estimate. Whereas the expenditure budget for the year is £597m, a 4.5% increase on the 2016/17 estimate.
Nominal GDP is forecast to have reached £1.91bn, almost 9% more in 2016-17 and the government is working towards its 2015 manifesto promise of £2.4bn GDP by end-March 2020.
High GDP ranking
Picardo pointed out that Gibraltar’s per capita growth, using IMF rankings, meant it would be placed fourth ahead of Singapore, Switzerland, Hong Kong, UK and Spain, although he counselled: “These measures are not entirely scientific because of the differing methodologies and fluctuating exchange rates on which they are based. Nonetheless, they are the measures that the rest of the world relies on.”
Aggregate public debt was marginally lower year-on-year at £443m at end March 2017, while cash reserves stood at £123m. Picardo reported: “Net public debt stood at £320m, or 16.75% of GDP, and we have reduced net debt since them by 8.5%.”
“Gibraltar’s economic performance has been outstanding in this first financial year since the Brexit referendum”, Fabian Picardo, Gibraltar’s Chief Minister, said when presenting the 2017-18 budget
Littered with references to the UK’s planned departure from the EU on 29 March 2019, which also embraces
Gibraltar, his sixth budget watchwords were “prudence, caution, optimism and investment”.
Picardo, vowed to “make Gibraltar the most attractive place in Europe and in the Mediterranean to do business” and reported a record surplus, employment, income and investment by the private sector.
However, veteran economic develop- ment minister, Joe Bossano, later cautioned: “The strong performance of the private sector in the last financial year may not be repeatable in the current year with so many imponderables that it is impossible to make any kind of sound judgment.”
“In terms of the existing economic model, we need to continue developing the initiatives and the areas of the economy that
‘Picardo, vowed to “make Gibraltar the most attractive place in Europe and in the Mediterranean to do business”
are showing growth until we are better gaming industry saw “spectacular job placed to be able to assess what is the likely growth” - up 9% (289) - after the referendum outcome in two years time,” Bassano result. In the past year, two new firms have
concluded. Maintenance of a free-flowing border
with Spain is of most concern, particularly after the European Council gave that country a right to veto any trade deals with Britain that also included this overseas territory.
“Twelve thousand people cross the frontier every day to work in Gibraltar. Seven thousand are Spanish. So Brexit affects Gibraltarians, British, Spanish, and other EEA citizens, as much as it does third country citizens,” Picardo remarked.
Picardo made clear that all EU workers
been licensed and four, others were in the pipeline, he revealed – “a truly remarkable vote of confidence in Gibraltar” and “we remain the premier jurisdiction in the world for the best regulated online gaming services available to consumers”. Gaming charges and fees increased in 2016-17 to over £15m, “demonstrating this sector is vibrant and performing”, Picardo maintained.
Civil servant employment grew by just 0.4% (23) and their pay will rise – again in contrast to the UK - by 2.75% from August.
Income tax now starts at £11,050 and
Ray Spencer
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Gibraltar International
www.gibraltarinternational.com
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