The government portrays itself as business-friendly and stresses the need for more growth.
The Chief Minister is unequivocal. To do this we need to look outside the island and find new areas of business to exploit. Some argue that policy is just what got us where we are today but Allan is having none of that and critics are labelled ‘naysayers’.
His ‘trusty lieutenant’ Laurence Skelly is firmly on side, busily dismantling work permit legislation to aid Allan’s five-year plan.
It’s not a bad analogy because Allan is becoming a bit like Chairman Mao and this it seems will be his legacy, a ‘Great Leap Forward’.
Well, we all know how Mao’s the great leap forward ended. Decades later for China it was freeing up indigenous entrepreneurial skill that made the country the economic powerhouse it has become.
So what of our local entrepreneurial skill? We hear daily about cases on individuals and families having their circumstances and family life squeezed by the government but recently I got an insight to another side of the economic nightmare.
I was contacted by a businessman who has operated a range of businesses on the island for well over two decades. With the exception of some limited assistance with start up over 20 years ago he has had no government assistance since. Over the years he has built up a solid employment base and, despite the economic downturn which required some downsizing, he weathered the uncertainties of recent years, today still employing about 40.
For part of the operation there is a rental agreement for one area of the business that falls under government, which after a five-year period fell due for review. He was advised that the rental will be almost doubled. Now this in itself seems excessive given that in recent years inflation has been very low.
An offer to the government in excess of inflation over the five-year period was declined and they are sticking to their guns. Indeed rather aggressively they ‘upped the ante’ saying if the issue goes to arbitration they will seek the full amount with immediate effect rather than phasing it in over two years.
I’m all for government getting maximum return on their property portfolio and I’m hardly noted for being a ‘bleeding heart’ for business but something seems decidedly wrong here. After all there are those 40 established jobs!
The whole thrust of government is to throw money at business to attract it to the island to secure employment – indeed £10 million per year over five years is being set aside for this purpose, the so-called Economic Development Fund. Of course ostensibly anyone can bid for this cash but it seems clear its aimed at attracting new external businesses and indeed some ‘fixers’ on island are already advertising it on their websites. However there is something amiss if at the same time established businesses are being squeezed to the extent they may have to lay workers off.
This story is not simply anecdotal. I have been shown the evidence including the existing rental and the figure demanded. I calculated that you would need to generate a year-long steady throughput to meet the existing rental and the 40 salaries weekly on the existing figure let alone the position ‘post increased rental’. This is not a singular issue either I have heard of similar cases.
What is the point of disbursing millions to encourage new untested businesses here when some Manx businesses with a tried-and-tested track record that have provided solid employment for two or more decades are being squeezed financially?
It makes no sense at all and it calls into question whether there is joined up thinking between various Departments of government.
Manx people would prefer to see established local businesses with a firm employment base grow than fund the ‘fly-by-nights’ queuing up at Skelly’s door for a hand-out!