Oliver Wyman Ltd was selected to carry out work which looks to assess growth options for the industry for the next five to 10 years.
The company has been paid a total of £559,300 for the work, which it started this month, with 62.5% of that cost being met by the States.
The figures were revealed in responses by Economic Development president Sasha Kazantseva-Miller to written questions from Deputy David Goy.
Deputy Goy said it was a ‘significant’ fee to pay a single consultant. He wanted the public to see line-by-line what they were buying.
‘My questions were designed to establish whether the Economic Development Committee had first proved that the same outputs could not be produced in-house or with cheaper, local expertise,’ he said.
‘£559,300 would, for example, cover the entire annual running cost of several school programmes or fund tax relief schemes for the low- to middle-income earners.
‘My questions invite members to confront that trade-off explicitly.’
The Guernsey Financial Services Commission is paying 25% of the consultant’s costs and Guernsey Finance is meeting the remaining 12.5%.
Economic Development said it was confident that work on the framework would analyse industry competition, identify emerging sectors, strengthen regulatory frameworks, address skills gaps, and enable Guernsey to enhance its global standing through marketing strategies.
A confidential technical report will be prepared for politicians and officials, and a public report will also be produced.
The committee said that it appointed Oliver Wyman following a competitive bidding process.
It said the decision to hire external expertise was based on the need for impartiality, as well as the credibility an independent consultant brought to the evaluation of Guernsey’s position in the global market.
Deputy Goy said Economic Development’s responses confirmed propriety, but failed to demonstrate necessity.
‘Every pound is still ultimately Guernsey money,’ he said.
‘The GFSC is funded by industry levies that licensees pass on to island consumers, and Guernsey Finance is grant-aided by the States. The total £559,300 remains a charge on the local economy.’
He questioned how an external consultant would give the final report greater credibility.
‘Rating agencies and international investors assess statutory data, regulation and political stability, not whose letterhead appears on a strategy document.
‘The answer never quantifies how much extra investment or tax revenue this supposed credibility will generate, so the return on the £559,300 is wholly speculative.’
He added there seemed to be no evidence of internal scoping.
‘The response concedes that significant expertise exists inside the States, but asserts that additional external expertise would be useful.
‘Nowhere is there a costed comparison showing what could be delivered by combining the GFSC’s policy team, the States’ own economics unit, and modern AI or data-analytics tools already licensed by government.
‘In the private sector, a board would require that internal option memo before releasing half a million pounds. The public sector should be held to the same discipline.’
Deputy Goy was also critical of the intention of keeping the technical report confidential. He said it would be hard for the public to know if it had received £559,300-worth of insight.
‘At a moment when the States is proposing GST, higher social security contributions and the loss of mortgage interest relief, approving a £500,000 strategy that could plausibly be home-grown sends a signal that fiscal restraint is being preached to residents more than it is practised by committees,’ he said.
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