28 May 2020
Today, the Minister for Social Security has approved the transfer of up to £150 million from the Social Security Reserve Fund into the Social Security Fund, to cover the cost of supporting Islanders and businesses during the coronavirus pandemic.
The money will be used to replace the income that will not be collected into the Social Security Fund this year due to:
- The reduction in income following the deferral of contribution payments from businesses
- The cancellation of the 2020 tax-funded States grant from government.
- The reduction in contribution income from reduced business activity.
An initial transfer of £55 million will be made, with permission granted for further transfers, up to the £150 million limit as needed during 2020.
Deputy Judy Martin, Minister for Social Security, said: "The coronavirus pandemic is an unprecedented situation, the consequences of which we have never faced before. The Reserve Fund is effectively our savings account, which we are drawing on in the same way an individual or business would do, in hard times.
"These transfers will use funds that aren’t tied up in long-term investments, so there won’t be any loss of value due to the current economic climate. I’d also like to reassure people that with a Reserve Fund worth £1.7 billion, there will still be enough to pay the old age pension and other contributory benefits for years to come.
Social Security Reserve Fund balance was £1.7 billion, April 2020.