2015 General Election Wish List

The private sector is the main creator of economic wealth in Gibraltar. Local companies and their employees pay the taxes which enable the government to invest in schools, the health service, public housing and other public services and amenities. The Chamber, whose members employ around half of the private sector workforce, sets out below what it would like to see from a new government.

Economic growth 1. Future GDP growth to be driven increasingly by the private sector and less by the public sector The GDP growth year on year continues to impress.

The Chamber’s concern is the increased role of the public sector on GDP growth. In the longer term, the private sector should be the engine room of any economy. Whilst spending on improving the government’s administrative infrastructure is to be welcomed, the Chamber is concerned that the increased efficiencies which were promised as part of the changes to public sector working hours have not fully materialised. In particular

the full introduction of e-government has not happened and our members cannot interact electronically with government as fully as they would like.

Employment 2. Reducing the public sector versus private sector employment disparity It is heartening that the economy continues to perform so well at the macro level. The concern amongst our members is the fear of a growing disparity between the terms, conditions and salaries offered to public sector employees in comparison to the SMEs in the private sector. Even well established companies have lost valuable staff to the public sector. Many companies in the private sector simply cannot compete with the terms, conditions and increasing salaries offered by the civil service. We believe that this growing disparity should be reversed.

Public sector pay increases should also be capped at inflation, not minimised at inflation, unless and until there are demonstrable productivity improvements.

3. Adoption and implementation of the Chamber’s Agenda for Change in Employment legislation Much of Gibraltar’s employment legislation is outdated and over the years it seems that only those elements of UK legislation which are beneficial to employees have been adopted.

This prejudices local employers unduly, leads to inefficiencies, lower productivity and makes Gibraltar less competitive versus other jurisdictions seeking inward investment.

4. Whistle-blowers scheme to identify and fine businesses with unregistered employees Businesses that hire illegal labour and unregistered employers do not pay tax or social insurance. They pay workers cash in hand and compete unfairly with legitimate local businesses which have higher cost bases.

They may also be breaking other laws such as health and safety or hygiene regulations. The Chamber wants a future government to set up a whistle-blower Freephone hotline to inform the ETB about illegal labour. Labour inspectors could then act on tip offs about unregistered employees. The results of the hotline usage and its effectiveness could be made public periodically. There is also a need to encourage greater co-ordination between HM Customs at the frontier and the ETB to clamp down on unregistered labour crossing the frontier each day. Random checks could be made at the frontier by officers from the Borders & Coastguards Agency and/or HM Customs to check that workers are registered with the ETB. Over time these two measures would serve to discourage recalcitrant employers from hiring unregistered workers. Progressively steeper fines might also be considered for those employers which are repeat offenders of hiring unregistered workers.

5. Vocational training support as well as academic and professional The Chamber applauds the government funded university tuition scheme and the recently introduced assistance in training for Chamber of Commerce Election Wish List

professional qualifications.

However, the cost of vocational training undertaken by our members receives no support whatsoever.

There is clearly a need for vocational training as many of these jobs are currently undertaken by non-resident workers. The Chamber calls for a new government to give assistance to private sector businesses which provide apprenticeships or other forms of vocational training. This would help to develop and retain the local skills base. We believe there should be a level playing field established by the government to the extent that all qualifying training (to be defined) which improves the skills of the Gibraltar workforce receives similar government support.

Business Costs 6. Annual increases in the minimum wage, social insurance, rates and utilities to remain at or below inflation Competition with other jurisdictions is fierce.

We need to ensure that the cost of doing business in Gibraltar is sufficiently competitive to retain existing business and attract new enterprises. The Chamber will monitor this as the new government formulates its policy.

Tourism-related issues 7. Holistic long term integrated strategy for the future of the wholesale and retail sectors The local retail and wholesale sector is under the progressive threats of cross border competition and online shopping. The local retail and wholesale sectors employ around 3,000 people directly and results in Gibraltar being a more attractive shopping destination with all the knock-on effects and benefits to other sectors. However, this number will inevitably decline as businesses in these sectors close due to increased competition from elsewhere. The knock-on effects of these closures on the local economy would be detrimental to Gibraltar. The Chamber is looking for a future government to implement

concrete measures to assist these sectors and in particular to enforce collection of duty on all personal imports.

In addition, we believe that a new rates charge (ie a reduction from the current 67p), for property use in the following classes is warranted: • A1 Shops, • A3 Restaurants and cafés, • A4 Drinking establishments, • A5 Hot food takeaways only, • B8 Storage or distribution (This class includes open air storage.)

These reductions should be implemented to help support ground floor (only) or those retail premises which are directly connected to a first floor retail area or where a property is specifically built as retail premises wherever located in Gibraltar.

8. A more holistic plan for Gibraltar’s transport network in respect of tourism The draft traffic plan does not adequately address how visitors would be able to travel to various sites of interest. Furthermore, the signage around Gibraltar for various tourism locations is poor. The Chamber would also like to see the introduction of a courtesy shuttle bus service to/from the cruise terminal to the market place for cruise passengers.

9. Develop a new tailor made tourist product with a specific emphasis on educational tourism, particularly for schools and youth groups from elsewhere.

Taxi service 10. A modern and efficient taxi service on a par with other modern jurisdictions The 2013 Taxi Charter has had little effect on the poor service provided by Gibraltar’s taxis There continue to be numerous complaints Chamber of Commerce Election Wish List

from across all sectors: tourism, business, and local users about the City service in terms of cost, availability, lack of response to phone bookings or just a refusal by drivers to take customers where they want to go. Both parties had manifesto commitments to tackle the continued poor service. Despite the numerous complaints and Chamber representations in the last few years the City taxi service fails to deliver an acceptable level of service for locals and visitors alike. The Chamber once again calls for a future government to ensure that Gibraltar has a modern and efficient taxi service and one that has an easy and efficient complaints procedure with measures such as a Freephone hotline and email address available on a notice at each taxi rank and inside each taxi for complaints to be sent to by those customers who wish to report poor service.

Port & Shipping sector 11. A commitment to build land-based fuel storage and related infrastructure to supply vessels with bunkers delivered by pipeline Gibraltar has lost out to neighbouring Algeciras in supplying bunkers to visiting merchant ships.

Other port-related services have lost out as a result. Gibraltar can only regain its competitive edge if it has modern fuel storage facilities.

12. Improved visa arrangements to facilitate crew transfers for merchant ships calling at Gibraltar Merchant ships use Gibraltar to make crew transfers due to the proximity of the port and airport. However, recent changes to visa requirements have made it more difficult to carry out these changes.

Government tax and rent collection 13.

Proactive arrears

collection

of

government

According to the Principal Auditor at 31 March 2014 government was owed £60.86m.

Further updates by the Income Tax office show tax arrears at ÂŁ32.8m in July 2015 and rent arrears of ÂŁ5.5m in July 2015. There appears to be no significant improvement in the year on year ability to reduce this level of debt owed to government. To address this the Chamber suggests setting up an independent statutory body free of political interference which would become responsible for collecting all government arrears.

14. End unfair abuse of government accommodation The Chamber urges a new government to introduce legislation which would make it an offence for tenants of government rental property to own another property.

This measure would ensure that those who have a property be it as an investment or holiday home in neighbouring Spain would not be able to live in subsidised government accommodation.

In essence, those who can afford a mortgage or who can afford to buy a property outright should not be entitled to live in rent-protected or government subsidised property to the detriment of those that truly need government housing.

15. More efficient and transparent procurement policies The Chamber has received complaints from members about procurement policies by various government departments.

Often there are few or no price comparisons undertaken by government departments and goods are ordered and signed for without any consideration as to whether the same goods could have been procured at a lower price or (where they are ordered from a supplier outside Gibraltar) even from a locallyregistered business. Many of the companies benefitting from the existing procurement policies are Spanish businesses which are not registered in Gibraltar and which do not pay taxes in Gibraltar or employ Gibraltar residents.

The Chamber would like the government to implement robust procurement policies that ensure that goods are sourced from locally registered businesses with Chamber of Commerce Election Wish List

adequate infrastructures. Such a policy would ensure that companies who wish to supply government departments with goods or services should be appropriately licensed and have adequate facilities and suitable premises to provide the relevant goods and services to government.

Other 16. The Chamber understands that the Post Office currently operates at a loss. We urge the government to look at new services and other forms of revenue generation which would make it selffunding.

17. Make a political roadshow in Spain an annual event Host an annual Gibraltar Day in Madrid to update potential investors, media and other interested parties on Gibraltar’s economic development.

18. Commitment to closer consultation with the Chamber on issues which will have an impact on businesses in the private sector. (e.g. the recently announced Gibraltar 2025 initiative).

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