THE Isle of Man has no alternative other than to abide by a new revenue sharing arrangement with the UK government and the loss of £75 million in additional revenue over the next three years.
And Tynwald has this afternoon been forced to accept that the Isle of Man’s new arrangement, which follows almost a year of intense negotiations, must go ahead.
When it came to a decision, there was a unanimous vote by all MHKs and MLCs in favour. However, an amendment was carried to change the wording of the resolution to say that Tynwald “notes” the new arrangement, instead of the original wording “accepts and approves” which was described by Speaker Steve Rodan as “misleading”.
He said the original wording suggested that the Isle of Man was happy to welcome the new agreement, whereas this was clearly not the case. His amendment was accepted by the House.
In a lengthy debate, during which virtually every member of parliament spoke, Tynwald was told that there had been “robust” negotiations between the UK Isle of Man governments on the basis that the previous VAT sharing agreement was “not sustainable”.
The UK said that they hoped the new arrangement would provide “long term security”. Throughout the debate, Members all accepted that the Isle of Man had to face the reality of reduced Customs & Excise revenue.
But the issue did not pass without a number of MHKs making critical remarks about the outcome of the negotiations with the UK government.
Treasury Minister Anne Craine rebuked comments made early in the debate by Brenda Cannell (East Douglas) that the Manx economy was being “propped up” by the money coming to the Island via the VAT sharing arrangement.
“Nothing is being propped up,” said Mrs Craine. “The Manx economy is worth £3.5 billion; this is £75 million . . yes it’s important, but we need to look at this in context.”
She also told North Douglas MHK John Houghton that he was wrong to suggest the UK was in breach of revenue sharing arrangements. “There is no breach,” she said. “The agreement is that either side can approach the other.”
She also used the opportunity to remind Members that any comments they make in Tynwald can have a devastating effect outside the Island.
“Some of these comments are politically naive and economically damaging. We need to be very careful about the language we use in here. The rhetoric is damaging, to say the least.”
It was a point emphasised by David Cannan (Kirk Michael) who initiated the emergency debate. “When you go to London to meet senior officials of the UK government you will see a copy of the local newspaper on the table. Do not imagine that anything said here does not find its way elsewhere.”
He also said that the revenue sharing agreement was of such vital importance that it was “not the time for political bickering”.
The mood of Tynwald was reflected probably most appropriately by Economic Development Minister Allan Bell who said it was time for the Isle of Man to forget about the past and make plans for the future.
