Govt redefines borrowing powers, prompting row in Parliament

A change to legislation redefining the Gibraltar Government’s borrowing powers will enable Gibraltar to benefit from low interest rates currently on offer, Chief Minister Fabian Picardo told the Gibraltar Parliament this week.

His intervention during a marathon session on Wednesday drew immediate flak from the Opposition, which intensified its criticism of the government’s handling of Gibraltar’s public finances.

In practical terms, the amendment allows the Gibraltar Government to borrow over £200m more than it is legally allowed to at present.

But Mr Picardo said this was not the purpose of the change, insisting that the government was on target to meet its target of £314m net debt by March 31 and that this was well within the legal debt limit even before the change in the law.

“We are not here looking to amend the law because we need to increase borrowing,” the Chief Minister said.

“We are proposing these changes in order to provide additional flexibility so that we can get a better deal for Gibraltar when it comes to the borrowing already in place and to allow governments of whatever political complexion to take future borrowing based on the size of the economy’s growth...”

The Opposition said the amendment was “flawed” and amounted to “a blind gamble” with Gibraltar’s future.

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