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Coronavirus pandemic cost local economy roughly £246m

Mon, 12 Jul 2021

The Manx Government’s Detailed Accounts 2020/21 will be laid before Tynwald at this month’s sitting.

Commonly known as the Light Blue Book, the document presents the financial outturn of the accounting period for the year ended 31 March 2021, and includes the financial impact of the coronavirus pandemic.

The accounts show the financial impact of the pandemic for the last financial year to be approximately £246m, split between £111m reduced Government revenue, £109m in direct support costs and £26m in other costs, for example the purchase of personal protective equipment.

The final position for indirect taxation receipts (VAT) will be determined in the near future and will be reported as part of the Statutory Accounts (the Dark Blue Book) which are expected to be finalised during August.

Treasury Minister Alfred Cannan said: ‘The cost to the public purse of dealing with the pandemic will not be a surprise but it is well within the worst case estimates that I presented to Tynwald in July 2020.

‘In order to meet our costs, a total of £57m was transferred from the Contingency Fund to cover pandemic operational costs, £78m was transferred from the National Insurance Fund to cover additional benefit costs and £111m of reduced Government revenue was funded by reduced costs and the residual deficit from the Net General Revenue Account [£60.5m]. 

‘However, despite this activity our reserves remain strong and indeed the market value of our externally invested reserves grew by £37.3m over the year, standing at £1.84bn at the end of March.’

Minister Cannan added: ‘It is further worth noting that capital expenditure for the year was just under £72m, close to last year’s level despite the pandemic, and that most Departments remained within their revenue budgets and actively managed the revenue impacts of the pandemic by approved fund claims and reducing costs, where possible.

‘While the pandemic has undoubtedly affected our financial position, these accounts provide continued evidence of the strength of our finances and will provide a platform for future economic recovery.

‘I remain resolute that the actions that we have taken and the financial support that we have delivered to protect jobs, businesses and individuals has been both necessary and appropriate.’ 

The Treasury intends to introduce a new-style annual report combining the Light Blue (Detailed Accounts) and Dark Blue (Statutory Accounts) books for the 2022/23 financial year end.

 

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