Isle of Man Budget Update at a glance
- The Treasury Minister Alfred Cannan MHK described the Budget for 2021-2022 as a “budget of resilience” that aims to stabilise the economy, protect jobs and invest in vital public services whilst providing a platform for economic recovery from the COVID-19 pandemic.
- Government revenue spending for 2021/22 is budgeted at £1.161 billion, representing £13,740 for every person on the Island – an increase of 3.9%.
- The resilience of the Island’s economy and public finances has enabled Government to make more than £100 million of direct financial support available to protect jobs and stabilise the economy in order to help the Isle of Man weather the storm of COVID-19.
- It is estimated that the pandemic will cost the public purse more than £200 million this financial year when taking account of lost revenue, increased spending, and drawdowns from reserves.
Additional spending of £18.8 million for public services
- Spending on public services from general revenue is set to increase by more than £18.8 million, with the largest increase allocated to improving the Island’s health and social care services.
- Manx Care, a new arms-length body that will take over the delivery of health and social care services from 1 April, is set to receive an additional £15 million, which will help it meet increased demand for services. Manx Care will, however, be tasked with delivering efficiencies of 1% of its budget in its first year of operation.
- The Government’s commitment to achieve net zero carbon emissions by 2050, along with efforts to mitigate the impact of climate change, are also prominent areas of additional spending in the Budget.
- There is £10 million for climate change mitigation and environmental initiatives as well as £6.25 million for climate change adaptions, which includes £2.25m for flood defences. In total, the Government has so far committed almost £17 million to addressing climate change.
Welfare benefits increase
- Some welfare benefits will see an uplift, with above inflation increases of 15.6% for contributions towards nursing home costs; 2.5% for the basic state pension; and 2.5% for the Manx state pension.
- Incapacity benefit, bereavement support, carer’s allowance, and jobseeker’s allowance will increase by 0.5%. The level of other benefits has been maintained.
Focus on improving delivery of capital schemes
- The Government’s capital programme – one-off spending, such as infrastructure projects – includes an additional £15 million for new schemes, taking the total programme to £182 million.
- Government’s focus, however, will be on delivering schemes already approved – including new delivery and governance arrangements for capital spending.
- A new Major Capital Projects Board will be established at the centre of Government to oversee and manage major or complex projects.
Platform for recovery
- The Government’s £100 million Economic Recovery Fund as an important element of efforts to build a platform for recovery in the wake of the pandemic.
- Funding from the scheme this year and next could total £40 million.
- Approvals made so far include £1.4 million to accelerate the rollout of fibre broadband; £3 million in additional funding to encourage more people to take up higher education; and £1.75 million for the Manx Restart Scheme, which aims to reduce unemployment.
Further information from:
Caldric Randall, Chief Financial Officer
Isle of Man
+44 1624 686433
+44 1624 685662