The States of Guernsey has reported a £24.9 million surplus in public finances recorded last year.
The 2016 States of Guernsey Accounts detail a significant improvement on earlier indications that a combination of lower than anticipated revenues and higher expenditure would result in a deficit.
The States has attributed the turnaround to improved underlying tax revenues in the second half of the year, along with measures put in place to improve the in-year position and returns from investment funds.
Revenue expenditure by committees was also £9 million below budget, with underspends recorded in pay and non-pay budgets.
Deputy Gavin St Pier, President of the Policy & Resources Committee, commended committees for their financial restraint, but added: “While the end-year financial position is to be celebrated, we are not out of the woods yet.
“The surplus position was only made possible at all by a reduction of £23.9 million in the appropriation to the capital reserve. This reduction in the amount put aside for capital investment was an appropriate short-term response to balance the budget.
“However, the implications of this adjustment, if continued, would limit our ability to appropriately invest in the island's infrastructure.
“As such, there remains an underlying structural deficit if the one-off measures for 2016 and excellent investment returns are removed. We can neither simply cut nor tax our way into a sustainable financial position. This deficit will only be tackled through a combination of targeted revenue-raising, largely from those best able to pay more, and a reduction in the cost of providing public services through public service reform.”
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