Tristan : Public Notice (2)
Submitted by Tristan Times (Juanita Brock) 18.04.2008 (Current Article)

Island Council Announces Austerity Measures to stave off possible insolvency

Island Council Announces Austerity Measures to stave off possible insolvency

The Tristan da Cunha Administrator David Morley delivered the austerity measures heralded in his March Budget Speech (see radio broadcast below) in a communication to Islanders on 11th April 2008.  

A range of new taxes and charges are to be introduced with effect from 1 June 2008.  These include income tax and a contribution to the island’s medical services.  The community charge was increased from 1% to 3% at the beginning of the year. 

Income Tax

The Island Council voted unanimously on 7th April 2008 to introduce an incremental taxation system.  This ensures that the lowest paid do not pay any tax on income. Legislation to introduce income tax to Tristan for the first time will be drawn up to be effective from 1 June 2008. 

Rates will be as follows:

£0-£1500 per annum – no tax

£1501-£3000 per annum – 10%

£3001 upwards per annum – 13%

Medical charges

Increasing medical costs (partly because of the soaring charges in South Africa and partly because of the ageing population on Tristan) mean that Government can no longer afford to provide free medical treatment to those who live on Tristan.  Under the measures to be introduced, everyone, except pensioners, will be required to contribute 4% of their income towards the cost of medical treatment with effect from 1 June 2008.

The FCO and Governor support the introduction of these charges as a means to help prevent the island from slipping into a position of insolvency and believe that it is appropriate to ask Tristan Islanders to make a contribution towards the cost of services they receive from the Tristan Government. 

Governor Andrew Gurr has sent the following message of support to the Tristan people:

"Like my Administrator I take no pleasure in the introduction of these austerity measures. But Tristan will not be able to continue to enjoy its financial independence and governmental self-determination for very much longer unless firm action is taken to redress its budget deficit and avoid insolvency. I am convinced that this is the fairest way for the community to begin to pay for the Government services it has for so long received for little or nothing. I very much hope islanders will understand the reasons behind this radical move, and accept that while unpleasant it is the right and only way forward".

But the Administrator is doing his best to ensure that this isn’t all one-way traffic. Following discussions between St Helena and London, the Government of Tristan has submitted a multi-million pound bid to the European Development Fund for investment in a wide range of island infrastructure projects.