Copyright jerseyeveningpost
By Carl Parslow “I DON’T care about politics,” a Jersey retiree said to me recently, “because my pension and income are effectively untouchable by the government.” It is a comforting belief, but a dangerously naïve one. In reality, no one is more exposed to the consequences of political decisions than those who depend on fixed incomes, public services, and long-term care. And in Jersey, where the state is expanding its reach at an unprecedented pace, retirees are not spectators, they are on the front line. The idea that pensions and other savings are immune from political interference is a myth. Jersey’s state pension is funded by a social security system that is subject to political control. Contribution rates, eligibility rules, and benefit formulas are all determined by elected officials. The Social Security Reserve Fund, while substantial, is not a fortress. It is a pool of money that can be (and is) redirected, restructured, or depleted depending on the priorities of governments. And those priorities are shifting fast. Private pensions and other such savings, often assumed to be beyond the reach of the government, are no safer. They are vulnerable to changes in tax policy, investment regulation, and inflation, all of which are shaped by political decisions. A future government could, for instance, alter the tax treatment of pension drawdowns, impose new levies on retirement income, or tighten rules on pension fund investments. These are not far-fetched scenarios. They are already being debated in other jurisdictions, and Jersey is not immune to similar pressures. Moreover, the performance of private pensions is tied to financial markets, which are themselves influenced by government policy, on interest rates, corporate regulation, and international tax treaties. A shift in Jersey’s fiscal or regulatory stance could have a direct impact on the value of pensioners’ private savings. The idea that private pensions are somehow insulated from politics is not just wrong, it is dangerously misleading. Jersey politicians are embracing big government. Public spending has surged, with the budget climbing to billions. Health, education, and social protection dominate the ledger. A billion-plus infrastructure programme is under way, promising digital healthcare, expanded nursery provision, and sweeping hospital upgrades. These are not marginal adjustments, they are structural expansions of the state’s role in everyday life. And they come with a price. A price in the billions. That price will not be paid by abstract taxpayers or distant institutions. It will be paid by Jersey residents, especially those with a money pot, retirees: through higher taxes, new types of tax and reduced benefits. As a case in point – the Long-Term Care Fund, which supports elderly residents with chronic needs, ran at a deficit last year. That shortfall must be addressed. Will the government raise contributions? Cut benefits? Delay access? These are not theoretical questions. They are imminent decisions that will affect thousands of retirees. Healthcare, as a whole, is becoming more centralised and more expensive. Apparently Jersey now spends more per capita on health than any OECD country. Yet access remains uneven, waiting times are growing, and we still don’t have our billion-pound-plus hospital. Pensioners rely on these services more than any other demographic. When the system strains, they feel it first. Housing policy is another political lever with direct consequences. Many retirees own property, but they are not immune to rising rates, shifting tax thresholds, or changes in land-use policy. A revaluation of property taxes (such as capital gains tax) or a reform of inheritance rules could materially affect their financial stability. And with inflation eroding purchasing power, even modest increases in living costs can have outsized effects on those with fixed incomes. The most dangerous risk, however, is complacency. Jersey’s political system is evolving. Power is consolidating in the hands of ministers and civil servants. Scrutiny panels are losing influence or, to the more cynical, are supportive. Parish assemblies are increasingly ceremonial. The traditional checks and balances that once protected local interests are weakening and accountability is sadly lacking. And if retirees continue to show little interest in politics, they will lose the ability to shape the very policies that govern their lives. This is not alarmism. It is arithmetic. Jersey’s ageing population, rising healthcare costs, and expanding state apparatus create a fiscal equation that must be solved. And when governments look for solutions, they look to where the money is: pensions and property. The notion that retirees are untouchable is not just wrong, it is reckless. Jersey is changing. The state is growing. And the stakes are rising. Retirees must not retreat into the illusion of immunity. They must recognise that their wellbeing depends not on the size of their pension, but on the strength of their political voice. Politics is not something that happens elsewhere, it is the process that determines whether your pension grows, stagnates, or shrinks; whether your care is timely or delayed; whether you, your home is taxed fairly or punitively. Every budget, every reform, every vote has consequences. The only thing more dangerous than bad policy is believing it won’t reach you. Politics matters, especially for those who think it doesn’t. Born and educated in the Island, Carl Parslow is an experienced Jersey Advocate and notary public with over 25 years’ experience. He heads up Parslows LLP business legal services department, advising corporates and individuals on a range of issues with a particular emphasis on acting for Jersey owner-managed businesses. Outside of work, he enjoys rugby and cycling with Lasardines.
