Client Weekly Update – 14 April

Market Update

European markets extended their gains on Friday late morning as traders continue to digest U.S. data. Cooling inflation raised expectations that the Federal Reserve will pause its current rate-hiking cycle. The Pan – European Stoxx 600 was up 0.4%, Germany’s DAX was up 0.3% and the UK’s FTSE 100 climbed 0.3%. France’s CAC pushed on to yet another high, up 0.2%.

U.S stocks are trading mixed today, with Dow Jones Industrial Average futures up 54 points or 0.16%. S&P 500 futures were flat, while Nasdaq 100 futures were 0.5% lower.

Asia-Pacific markets largely rose on Friday, following the moves of Wall Street as the U.S. producer price index signaled further signs of cooling inflation. Japan’s Nikkei 225 led gains in the region and gained 1.2%. The Hang Seng Index was up 0.27% and China’s Shanghai Composite closed at 0.60%.

Bank issues ‘sincere apologies’ to Jersey customers after credit-card email mistake

A major bank has apologised after causing concern among Jersey users of its credit-card service with an email that ‘incorrectly’ informed them their accounts would be closed. Barclays has sought to reassure Barclaycard cardholders in Jersey and Guernsey that there will be ‘no change to the service they currently receive’, after they were mistakenly told their cards would stop working next month. An email sent to customers early this morning said Barclaycard accounts without a UK residential address were being closed as the company was ‘no longer offering accounts to customers living outside of the UK’. ‘If you don’t have a UK residential address, then your card will unfortunately stop working on or after ‌30 May 2023 and we’ll close your account on or shortly af‌ter 21 June 2023.‘We know that this may be disappointing and inconvenient, so we’re here to help you understand what this means for you and what to do next. If you have other accounts with us that are affected by these changes, we’ll contact you about them separately,’ it stated.

The announcement came as a shock to many, with several Barclaycard customers contacting the JEP. One Islander, said: ‘It was completely out of the blue – I was wondering if it was a scam [email] at first.’ The email comes just a few months after the Jersey Consumer Council warned that credit-card companies are pulling out of Jersey because they cannot check customers’ details on a central register – and that the trend could spread to mortgages, loans and other financial services. Another Islander said: ‘If Jersey doesn’t do something from a regulatory point of view then there is a real risk this could become a big problem.’ However, some Islanders claimed they contacted Barclays about the changes only to be told the email had been sent ‘in error’. In a comment on the ‘Jersey Ask! Advise! Advertise!’ Facebook page, one said: ‘I enquired at Barclays Library Place who emailed me to say “the email was in fact sent in error and was not supposed to be distributed to Jersey, Guernsey and IOM residents. ’A Barclays spokesperson said: ‘We offer our sincere apologies to any of our Barclaycard customers resident in the Channel Islands that may have been incorrectly informed that their accounts would be closed. ‘We can confirm all existing cardholders resident in Jersey and Guernsey will continue to be supported and there will be no change to the service they currently receive.’

Ministers back call for windfall charge

A fresh attempt to introduce a windfall tax on the vast profits generated from the sale of land rezoned for development has been ‘broadly’ supported by the government. The Council of Ministers has lodged an amendment to a proposition put forward by Reform Jersey Deputy Raluca Kovacs, which calls for a land development tax ‘or an equivalent charging mechanism’ to be introduced to raise revenue for the States from any significant uplift in the value of land, from when it is rezoned or planning permission has been granted. Deputy Kovacs’ proposition seeks to end years of political debate about whether to tax the large sums of profit that can be generated after land is rezoned.

Last year saw field J1109 in St John sold for £3.55 million after it was designated an affordable-homes site in the Bridging Island Plan. Prior to the rezoning, the 6.71-vergée site – located next to the former Sion Chapel – was estimated to be worth around £70,000.The Council of Minister’s amendment asks that the wording of Deputy Kovacs’ proposition be altered to remove references to ‘tax’, on the basis that the new charge could take the form of a tax, levy, or ‘some other mechanism to extract value’. It also seeks to extend the date by which the necessary legislation would need to be brought forward for approval, from Deputy Kovacs’ target of 31 March 2024 to 31 March 2025. ‘The Council of Ministers is broadly in agreement with Deputy Kovacs’ policy aim to introduce a charging mechanism to capture a proportion of the uplift in land value arising from land being rezoned or when planning permission is granted, while being mindful that this needs to be well-framed to avoid undue disincentives or delay in developing land,’ the amendment’s accompanying report read.

Deputy leads the push for regulation of estate agents

Estate agents may soon have to become members of a government-approved redress scheme, following renewed calls for the industry to be regulated. Deputy Max Andrews lodged a two-part proposition with the States to establish regulatory schemes for estate agents in late March, after the Environment Minister revealed he had ‘no plans’ to do so. Deputy Andrews said at the time that there was ‘a need to ensure that estate agents were members of a statutory regulatory body and redress scheme’. He added: ‘As it stands, estate agents can access the market with ease without undertaking professional qualifications when dealing with transactions that are the biggest investments some people will make in their lifetime.’ Deputy Andrews has now described Deputy Renouf’s decision not to move forward with regulation as an ‘unpopular move.’

The first part of the proposal, that the Economic Development Minister should establish a ‘statutory regulatory body for estate agents’, has been rejected by the Council of Ministers in an amendment to his proposition. But the second part, that estate agents should register with an ‘independent redress scheme’ looks set to pass, albeit with a slight amendment: that the scheme is ‘approved by the Government of Jersey’. As it now stands, the proposition requests that by December 2024, there will be a requirement for estate agents to obtain membership of a government-approved independent redress scheme. It would then be an offence for a business which conducted estate agency activities not to be a member and participate in an approved redress scheme under the Consumer Protection Law, the penalty for which carries a level three fine (£10,000).Deputy Andrews said that the proposition would bring Jersey in line with the UK, where it has been a mandatory requirement for estate agents to join an approved consumer redress scheme since 2008. The Property Ombudsman, one of the schemes, makes approximately 5,700 decisions a year, achieving 99% compliance.

People don’t vote ‘because they don’t trust the political system’

A lack of awareness, education and trust in the political system have been cited as reasons for Jersey’s poor voter turnout at elections – as it was revealed the Island ranks lower than any country in the OECD for engagement. Jersey has faced criticism for its poor engagement for several elections now, with the voter turnout often hovering around 40%, although this number drops significantly for by-elections. And a new report from an Island-based think-tank revealed that only 17% of those under the age of 35 voted at last summer’s general election, while just 16% of tenants cast their ballot. By comparison, Islanders aged 65 and over had a turnout of 53% and owner-occupiers’ turnout was 41%. The figures also highlighted that those living in urban areas were far less likely to take part in elections – with just 18% voting, compared to 40% in rural parishes. Deputy Carina Alves, who chairs the Political Awareness and Education Sub-committee, said that during her most-recent election campaign, she met ‘far too many’ people who did not know they were eligible to vote. ‘I feel that government departments simply do not communicate this vital piece of information enough. Those who move to the Island are eligible to vote only after two years’ continuous residency.

Only those registered to vote are eligible, and while moves were made ahead of the 2022 election to allow online registration, there are still no methods to allow for automatic registration on the electoral roll. St Martin Constable Karen Shenton-Stone, who chairs the Privileges and Procedures Committee, said that the low figures were ‘very, very disappointing’. ‘I wish I knew what the magic thing was to do to get them out voting,’ she said. ‘It’s very concerning to me and I think it’s absolutely critical to find out why people won’t vote. ‘We need to empower them and make their voices heard. ’Major changes to the composition of the States Assembly were made before the 2022 election, with the Island wide office of Senator being scrapped in favour of 37 Deputies’ seats in larger constituencies sitting alongside the 12 parish Constables. The move was designed to make the Island’s political structure simpler, with the hope that this would improve turnout. However, during the campaign, many criticised the loss of the Senators, and there have since been calls to reinstate the Island wide mandate.

Though the election had seen a low turnout, Mrs Shenton-Stone said that changes in the electoral system in 2022 meant the States became much more diverse, with a higher proportion of female candidates being returned than ever before. Sir Mark Boleat, who authored the Policy Centre Jersey report, said: ‘Jersey’s voter turnout has lagged behind that of its neighbour Guernsey, where the turnout at its most recent general election was 79.7%. He said that one other factor that might be at play is that people were not used to voting. ‘The evidence is that people not born in Jersey are more likely to vote than Jersey people,’ he said. ‘People who have come here from Britain are used to having voted in elections. It’s standard – people vote.’ Turnout at the last election was 41.7%, making it the election with the third-lowest turnout in the last 30 years.

La Collette may have to shut its gates to hazardous waste

The prospect that all asbestos removal, construction on contaminated land and clinical-waste disposal could grind to a halt tomorrow is the result of poor government planning over decades, an environmental campaign group has said. SOS Jersey – which has been monitoring contamination levels around Jersey’s coastline for more than 25 years – argues that the current deadlock between the government and Planning Committee over the creation of new headlands of hazardous waste at La Collette is self-inflicted and demonstrates the need for an independent environmental regulator. SOS Jersey co-ordinator Dave Cabeldu said that the government was facing a ‘perfect storm’ completely of its own making – caused by a combination of poor planning, a ‘nothing-to-see attitude’, a lack of understanding by politicians and an absence of proper oversight.

The government has said that if the committee’s decision to refuse planning permission is ratified, the Infrastructure Department will be forced to close its hazardous waste dump, increasing the risk of illegal fly-tipping. Planning Committee chair Constable Philip Le Sueur said that it felt as though the government was holding a gun to the committee’s head. The ‘perfect storm’ described by Mr Cabeldu includes what he describes as disjointed plans at the Waterfront, a new sewage treatment works which is not fit for purpose and the fact that hazardous waste has continued to be dumped on reclaimed land without planning permission however, he said that the issue – which had been known about for years – would not have arisen if there was an independent body regulating the environment.

The responsibility currently rests within government. ‘The government regularly hands over planning decisions to an independent inspector but we don’t have the same system for the environment. It is just bizarre,’ he said. ‘I have no doubt that an independent body would have forced the government to act sooner and decisively. ‘Instead, we get a government tying itself in knots and making bad decisions, such as deciding to dig up contaminated material at the Waterfront to move it a few hundred metres to La Collette. It would be a lot better and cheaper to leave it where it is. ’SOS Jersey has today published a report which raises this and other concerns. For instance, the group says that official samples collected at the discharge pipe from the Bellozanne sewage treatment works over 15 years show that nitrogen levels have been consistently above the permitted limit. This is the reason that St Aubin’s Bay has been covered in sea lettuce each summer for several years, it argues.

Ferry disruption continues due to French strike action

Travel disruption is set to continue for Islanders returning from Easter getaways, as major French strike action causes further ferry cancellations this weekend. A spokesperson for Condor Ferries said: ’The morning and evening sailings to and from Jersey and St Malo are still operating. However this morning’s round trip was brought forward by and hour and a quarter to avoid the 11am cut-off.’ They added: ‘In order to accommodate Guernsey passengers due to travel today, we have automatically moved them to Saturday. We regret the inconvenience this causes but these are clearly circumstances outside of our control.’

Evening sailings between Jersey and St Malo have not been affected. For several months, large parts of France have been brought to a standstill by industrial action and violent protests sparked by President Emmanuel Macron’s controversial pension reforms. Much of the country’s transport system remains paralysed, with major roads blocked and rail, ferry and air services all badly affected. The UK Foreign Office has urged those travelling to France to ‘monitor the media, check the latest advice with operators before travelling, avoid demonstrations and follow the advice of local authorities’. Any Islanders wishing to transfer, discuss other options or cancel their booking with Condor can visit the company’s website or call 0345 609 1026.

Number plates go on sale for over £300,000

A pair of consecutive two-digit number plates are available in a private sale – if you’ve got a spare £300,000 knocking around… J72 and J73 are advertised and are only available together. The seller – who wants to be anonymous as he is selling on behalf of a friend – said that the plates ‘would make a good his-and-hers’ present. He said they expected to hear from a small number of car enthusiasts, and added that if no serious offer was on the table, the number plates would not be sold. The seller is asking for offers over £300,000. He said: ‘I have never seen two advertised together before and I don’t know if it will come up again.’

The owner of the number plates has owned one of the numbers for over 40 years, and bought the second plate recently to complete the set. The J72 plate was auctioned in August 2022. The seller said that he had not known that the plates needed to be attached to a car until they placed the advert. For legal reasons, number plates can only be sold attached to a vehicle, so it is common to sell valuable number plates attached to cars or motorbikes of little value. The J72 number plate was attached to a 1999 Honda Civic 1.6 estate when it was sold in August 2022.