It is a disappointment in a way that our visitors from the U.K. have not stayed for this debate. I have
had some fun with this on social media, because when I proposed this proposition there were some
people who assailed me with versions of: “Why are you so anti-wealth or anti-enterprise?” I was
able to reply very easily because my proposition is, at least in theory, aligned with Government
policy. If I am anti-wealth and anti-enterprise, then so must Ministers be. Despite what the
Government seems to be implying, I am not asking the Government to change its policy. I am simply
asking the Government to stick to its policy. Yes, to give it a little more precision, but not
fundamentally changing the numbers. The Government says its policy has not changed since 2005.
It is an aspiration to approve approximately 15 high-value residency consents a year. I am going to
use H.V.R. (high-value residency) as an abbreviation. However, on a 5-year average basis, it has
exceeded that figure every year for the last 10 years. Even if you take arrivals as your metric, as the
Government now says it does, we are still way over the aspiration in recent years. I say that I am
asking the Government to stick to its policy, but I would also have been happy if the Government
had brought forward an amendment to change the policy if it believed that 15 consents a year is no
longer the right metric. It has not done so, of course. It says that it is sticking to the existing policy,
but confusingly, it also says that there is no problem in not following the policy because the outcomes
are positive. I want to address for a moment the suggestion in the comments paper, the allegation
really, that the proposition appeared to be confused, which I must say I was not impressed by. In
particular, considering that it has taken a Standing Order challenge in order to get a decent set of
figures out of the Government. It is said that the proposition confuses the question of approvals given
by H.A.W.A.G. (Housing and Work Advisory Group), the Ministerial group that decides
applications, with actual arrivals. If there is confusion, it is not me who is responsible. I have done
my level best to gain clarity. The Government now states that the long-established policy is 15
arrivals a year. But that is not what the Government has been saying for many years. The policy has
been restated many times. For example, in 2023, in a report to the Government proposition:
“Government policy for the number of housing consents granted has varied over time, having initially
been set at 15 per year in 1974.” The objective to grant 15 consents per year was restated in 2005
and has remained in place since.
[15:45]
The policy, since 2005, was 15 consents a year. Not arrivals; consents. What is a consent? Well,
this is where the confusion begins. The concept of housing consents was abolished in 2012, I am
told, when the then Housing Law was repealed. However, the Government continued to restate, as
recently as 2023, as I have just quoted, that the policy related to the number of housing consents,
when no such thing existed. Instead, it seems to have adopted a convention, without telling anyone,
that when the policy said “consents”, it meant acquisition of a property under the 2(1)(e) law, which
signified arrival. When I became aware of this, I asked government officers whether approved
applications, as in approved by H.A.W.A.G., were the same as approved for housing status under
2(1)(e). The answer came back, and I quote: “They are one and the same.” I understood that to mean
that they had applied for and been given their housing status. In other words, that approval meant an
actual agreement to transact. I want to say very clearly here, I do not wish to imply criticism of the
officer who sent that email, who has been exceptionally helpful in attempting to answer my questions.
I think we are dealing here with the limitations of language. He understood something different from
the question than I intended. But my point is that if the proposition confuses the definitions, it is not
for want of me trying to gain clarity. I have done my best. In any case, the question of confusion
does not invalidate this proposition. It is clear that approvals can mean what the Government wants
it to mean. The proposition requests the Chief Minister to limit the number of entitled status
approvals granted to high-net-worth individuals under Regulation 2(1)(e) to 15 per year, calculated
on a rolling 5-year basis. Well, fine. There is nothing stopping this proposition being interpreted to
mean approvals taken up by H.V.R.s, which happens at the point of arrival. Let me deal briefly with
the figures provided by the Government. I am only just getting my head around the new figures that
came in this morning. But leaving aside arguments of definition that I have just gone through, it is
absolutely clear that in the last 15 years or so, there has been a step change in the high-value residency
scheme. According to a report - I think it was from Colin Powell in the early 2000s - in the 1970s,
there were 30 arrivals. That is for the whole decade. In the 1980s, it was 34. In the 1990s, it was
38. In comparison, in the last decade, there were 184 arrivals. The Government argues that we
should focus on net arrivals, i.e. total arrivals minus departures, even though this has never been the
target. In the last 20 years, there were 130 net arrivals, but of those, 80-odd were in the last 10 years.
We have gone from 30-odd arrivals a decade ago to 80, even if you account for departures. Another
way of looking at the jump in recent years is that in the last 10 years, the resident population of high-
value residents has more than doubled. It took more than 40 years to get to 100 high-value residents,
but since 2016, we have gone from 101 to 225 today. The reason for my proposition therefore
persists. The numbers are rising much more quickly in the past. They are above any target the
Government has set, whether that is arrivals or approvals. I want to say some words about the benefits
of the high-value residency scheme because I want to be clear, there are benefits to the high-value
residency scheme. The tax income is the most obvious; £250,000 a year from the newest arrivals.
The Government tells us that 5 per cent of all income tax revenue is derived from the 230-odd H.V.R.s
currently residing here, and there is stamp duty, G.S.T. (goods and services tax), obviously, and other
taxes and charges, no doubt. I know many H.V.R.s contribute to charities, and the Government is
attempting to make the £100,000 a year charitable contribution as close to compulsory as it can.
However, it is wrong to say in its report that they must make a £100,000 contribution, as the email
from the Community Foundation that was circulated earlier today makes clear it is voluntary. There
is nothing in law that can hold that contribution to be compulsory. However, I know that many do
make the contribution and indeed exceed it. I also know, as the very helpful letter from the
Community Foundation points out, that they are heavily involved in other charitable activities, and
in lending their expertise and time to relevant organisations. These are very valuable contributions.
This proposition would make a negligible difference, if any, to those contributions. I recall, all the
proposition says is that we should stick to 15 new residents a year. The effect of my proposition
would be to moderate growth, not to reduce the amount of money given. Beyond charitable
contributions, I am also aware that the Government is now placing particular emphasis on applicants
who might help to diversify and innovate within the economy, particularly, for example, within
financial services, in A.I. (artificial intelligence), or to innovate and invest within the economy more
generally, and that their knowledge and capital are significant assets. The dynamism, global outlook,
and international connections that H.V.R.s bring to the Island are hugely beneficial. These benefits
are real benefits from the H.V.R. programme, and the fact that they have been summarised briefly
here is not in any way to diminish their significance. On the other hand, there are clearly costs to
running an H.V.R. programme. The Government seems very reluctant to admit this, but it has been
explicitly acknowledged since the earliest days, indeed the very notion of having limits would not
apply if there were only upsides. The costs fit into 3 categories: damaging social cohesion, distortions
in the economy, and excessive political influence. I do not think there is any question that the
existence of a programme that offers tax and other benefits to its beneficiaries that are not available
to the rest of the public is divisive. Being able to bypass normal housing controls, bring in staff and
family without the need for licences, and avoid standard taxation rates creates an explicit double
standard and delivers advantages to people who are already well-advantaged. I think there are subtle
signals that reinforce the sense of social division that a large H.V.R. programme creates. Calling
very wealthy immigrants “high value” signifies that the value of a citizen is judged by their private
wealth or income. The very highest value citizens are those with the greatest wealth. It could equally
be argued that doctors, nurses, teachers, care workers, and so on are also high-value residents, and
that equal, if not greater, Government efforts should be made to attract immigrants in these categories,
particularly where we have known shortages. I recall that when I was a Minister, I made a short-
lived argument that the head of high-value residency should be repurposed as the head of essential
employment with a brief to fill crucial gaps in the labour market. It did not gain much traction. The
general point is that in an Island where there is considerable economic hardship, it is damaging for
social cohesion to see very wealthy immigrants given preferential treatment, and the more there are,
the greater that effect becomes. It is worth noting that Jersey’s Gini coefficient, which measures the
degree of inequality in a society, is 0.43 at the latest measure. It has climbed steadily over the last
15 years. It is well above the O.E.C.D. (Organisation for Economic Co-operation and Development)
average, and even marginally higher than the United States. We know that in general, countries with
a lower Gini coefficient have higher levels of trust, greater social cohesion, and on many measures,
better economic outcomes. I also want to point out that resentment at the special treatment given to
high-value residents is not just concentrated in less well-off income groups. I have been contacted
by a number of what I think you would generally call well-off Islanders, since I put forward this
proposition, who have spoken of their resentment that their lifetime of commitment to the Island has
included paying tax at 20 per cent, but someone who has only just arrived gets taxed at 1 per cent,
and many of them were in favour of getting rid of the whole scheme. I should point out that not only
do high-value residents benefit from a fixed tax bill, currently £250,000, but their bill is frozen at this
level in perpetuity. This explains why there are 230-odd H.V.R.s in the Island. The average tax
contribution is only around £140,000 a year. Most are grandfathered under one of the previous
schemes. Economic distortions. It has long been recognised that high-value residents can have a
negative impact in certain economic sectors. P.2/1974, which I am sure Members are familiar with,
initiated the first H.V.R. scheme, 1(1)(k), as it was, included the following list of potential costs: the
effect of superior purchasing power on the take-up of housing and building resources reflected both
directly and indirectly in house prices; the demands placed on labour supplies; the demands placed
by ancillary domestic staff on educational and medical services; the effect on the use and price of
agricultural land. I think those are all equally valid today, and they would resonate with man y
Islanders. From my own experience in Government, it was clear that high-value residents, if we
move on to political influence, enjoyed high levels of access to Ministers. On one level, that is not
surprising. However, it is a matter of understandable concern if high-value residents are able to
exercise influence behind the scenes, and the greater the number, the greater this influence will be.
Last year provided a very clear example of the outsized influence of a small number of high-value
residents in relation to a matter of public policy. A year ago, the Minister for the Environment
cancelled supplementary planning guidance relating to the 3,000-square-foot floor space limit. This
guidance placed restrictions on the construction of homes above 3,000 square feet in pursuit of the
policy aim of encouraging the development of a number of family homes on a site rather than a single
very large house. Restrictions, not a ban, by the way. The fundamental issue here is not whether this
was a good or bad policy guidance. You can argue it either way. It is the way in which it was
changed. The report accompanying the decision stated: “The basis for the review emerged at the
request of the head of high-value residency engagement.” The head of high-value residency
engagement had requested the review because of “three clients who have projects that are directly
concerned by the changes.” The Minister went ahead and cancelled the supplementary planning
guidance without consulting on the change. This was a profoundly damaging decision because it
gave credibility to the argument that when it comes to the planning system, there is one rule for the
very wealthy and another rule for the rest of us. In effect, 3 high-value residents were able to achieve
a rewriting of planning guidance to their own benefit. This is what I mean by undue influence in the
political system, which in turn has a damaging effect on social cohesion. So, we face a dilemma.
We have benefits and we have costs. How do we resolve a situation like that? Well, in principle, I
do not think it is that difficult. I argue that the way to maintain a balance, and therefore to ensure
public acceptance of the scheme, is to keep the numbers of new entrants under control with a clearly
defined policy that the Government commits to following. That is what this proposition is designed
to achieve. I should at this point confess to a failing on my part, not for the first time, I am sure. In
2023, I voted against a proposition brought by Deputy Feltham that would have required a cost-
benefit analysis of the H.V.R. scheme, even though something similar was in my manifesto. I cannot
now recall my thinking at the time particularly.
[16:00]
I suspect it was because I was trying to be a good boy scout and show loyalty to the Government, but
I do not think that is a sufficient excuse. It was an error that I regret. Let me turn to the Government’s
case. Reduced to its most basic, the Government says that the current level of high-value residency
approvals is nothing to worry about because the actual growth in the size of the H.V.R. community
remains modest. There are a number of problems with this argument. First, regardless of the metric
used, as I have said, the size of the H.V.R. community has grown rapidly over the last 10 years. This
is indisputable. It took 40 years to get to 100. In the last 10 years, that has more than doubled.
Second, the idea that it is fine to go over the limit because so many H.V.R.s, leave each year, in a
sort of balancing measure, is a highly unreliable method of achieving balance. It is, after all, the
intention of Government policy that H.V.R.s will stay for a good long time. So, if large numbers
leave, then that is a policy failure. Justifying one policy failure on the basis of another policy failure,
is not exactly the basis of a good long-term strategy. I have also heard it said in Government circles
that getting more high-value residents in, is the nearest thing to an easy win that we have. An eloquent
case has been made for the benefits that come from an expanded high-value residency scheme, which
is all fine, it is just not the stated policy. It is pretty clear to me that at present the Government is
following a “as many as can get” policy, probably aiming to capitalise on the clampdown on non-
dom status in the U.K. and the mansion tax and so on. The underlying assumption is that more is
better. I respectfully disagree. I believe a carefully controlled policy will deliver better outcomes.
Relying on ever greater numbers of high-value residents is itself contradictory, because we are
becoming ever more reliant on a cohort of taxpayers, who we also seem to acknowledge are highly
mobile and could leave at any time, and large numbers do indeed leave, it seems. A prudent course
of action in this situation would be to limit our dependency on this group, to keep it within
manageable bounds. In fact, our dependency is growing and will continue to grow quite significantly
if this proposition is not adopted. Finally, at its core, this proposition is about striking the right
balance. Clearly-stated policy setting explicit limits within a policy framework that is transparent
will maximise public support while ensuring that the potential downsides to going overweight in
high-value residents are mitigated. I move the proposition and look forward to the debate.