Hassan Nahon slams ‘sham’ budget but questions GSD’s ‘irresponsible’ stance

The Gibraltar Government should publish the spending of all government-owned entities that it has kept out of the public eye “through financial engineering and legal opinions”, Independent MP Marlene Hassan Nahon said yesterday.
In a budget address that echoed many of the GSD’s concerns about public finances, Ms Hassan Nahon said opposition MPs were being asked to assess a budget that presented an incomplete picture of government spending.
But she was also sharply critical of the GSD’s decision to vote against the budget, insisting that this was an irresponsible move that went against the interests of Gibraltarians.
Ms Hassan Nahon delivered a wide-ranging speech that reflected the fact she shadows all government portfolios. But her strongest words were reserved for her analysis of public finances.
“There is an equally important budget of borrowing and spending that is never reported, debated or accounted for,” she told Parliament.
“This must change. Otherwise, this can feel like a hollow process, and one that does not give the appropriate scrutiny to how Gibraltar’s finances are handled.”
“There is no real distinction between the Government's useable cash reserves and the pools of cash held by Government owned companies.”
“Similarly there is no material difference between the debt held by one public entity and another.”
“It is all public debt, just as all government spending is public spending.”
Ms Hassan Nahon accused the government of doing Gibraltar “a great injustice” by keeping a large section of its spending off its books.
She said that there was mounting concern in the community for “a true picture” of public finances.
She said it was wrong to suggest that spending by government-owned companies was unrelated to the public sector and insisted the government had a duty to be transparent with taxpayers.
In common with the GSD, she said the borrowing of public entities should be included in the public debt as occurs in the UK and other countries.
“Otherwise, does it not show the budget process to be little more than a sham?” she said.
“Our government taxes and borrows in order to meet planned expenditure, so therefore I petition the government to report on all current and planned government expenditure.”
“This is the only way to prevent our people feeling that they are being kept in the dark about what is being spent by government-owned companies.”
She had stern words too in respect of the £300m secured by the government from London investors against publicly-owned housing estates in Gibraltar.
While the government insisted this was an investment, Ms Hassan Nahon said it was clearly a mortgage, adding that to say otherwise was to mislead the public.
She also described it as “illogical” that there was no mention in the budget about the deal or how the money would be spent.
“If we are indeed headed towards harsher times, then we need to tighten our belts and take prudent measures rather than doubling down by borrowing large amounts at a time of increased Brexit-related uncertainty,” she said.
“We should be protecting our borrowing capacity, rather than burning straight through it.”
Ms Hassan Nahon said debt was “highly addictive” and warned that unsustainable borrowing and spending could put in jeopardy the wellbeing of future generations of Gibraltarians.
She called on the government to enable deeper scrutiny by providing information on all public sector liabilities, obligations and contingencies, even if these were not included in government balance sheets.
“Concerned Gibraltarians see the increase in off-balance sheet borrowing from the savings bank followed by the estates mortgage as clear evidence that the government has over stretched financially, and, as a result, it is now having to mortgage the family silver,” she said.
“But how can government reassure us to the contrary when we are not actually entitled to scrutinize them?”
She said the concerns about public debt and spending became even more important when viewed against the fact that many important areas of the community were in need of investment, including schools.
And while she was tough on the government for its handling of public finances, she was equally firm with the GSD for announcing it would vote against the Appropriation Bill.
She said the move was “irresponsible, cynical and completely against the interests of Gibraltarians”, adding that the full effect of the decision – were it not for a government majority - would be to paralyse the community.
She pointed out that Sir Peter Caruana, who led the GSD in government for 16 years, had once argued that all parliamentarians should support a budget even if they opposed its measures, “in order not to deprive the Government of funding and civil servants of their pay”.
“I therefore find this move to be little more than a cosmetic and sterile marketing stunt that smacks more of desperation than it does a responsible approach to politics,” Ms Hassan Nahon said of the GSD’s decision.
Ms Hassan Nahon said she would vote in favour of the Bill even though she had “honest doubts” about it.
And there was a fiery exchange too after she alleged GSD leader Daniel Feetham “…hides behind the profiles of members of our community to fight his battles against me.”
That drew a furious response from Mr Feetham, who called a point of order and said the accusation was “utterly false”, challenging Ms Hassan Nahon to substantiate her claim.
Ms Hassan Nahon responded by naming a person whose profile had allegedly been used by Mr Feetham, insisting she had been told by the person himself. Mr Feetham again hit back and said the accusation was “outrageous”.
Ms Hassan Nahon, whose speech was laced with examples of how she been critical of the government in some areas while supporting it in others, said Gibraltar was ready for a break from two-party “mudslinging politics”.
She said her aim was to represent “something new” in parliament and deliver for Gibraltar “a bold, optimistic approach” to politics.
“In Gibraltar, people want politicians who are close, honest and understand their real aspirations, politicians that work for their citizens, not for partisan visions, egos or agendas,” she said.