16 October 2025
Statement from the Minister for Social Security, Deputy Lyndsay Feltham:
I want to clear up some misconceptions that have crept into the public debate on social
security funding and reassure Islanders that the funds that secure our pension system are in a
strong position.
I can assure pensioners that there is more than enough money in the funds to continue paying
their pensions. Our reserves are over £2.5 billion, which would be enough to pay pensions for
the next seven and a half years even if no more money were paid in. This is far more than other
national pension schemes: Guernsey and the Isle of Man have enough reserves to cover four
years, while the UK’s would cover less than a year. And our funds will continue to grow over the
next four years.
I welcome constructive scrutiny and debate on the forthcoming Budget. However, recent public
commentary has suggested that the Government is improperly using the Social Security
Reserve Fund to support everyday public spending. This is not true. It is important that any
debate on this is based on fact, not scaremongering.
We are not “raiding” or “plundering” the fund. On the contrary, the Government of Jersey is
allocating £184 million from general taxation to the Social Security Funds in the forthcoming
Budget and Government Plan. This is on top of contributions, and a significant investment in the
long-term sustainability of our pension system, not a withdrawal. It reflects our commitment to
responsible financial planning and to safeguarding the future of Islanders.
What we are proposing to do is reduce the States Grant – the amount that taxpayers pay into the
Social Security Funds – as a temporary measure, in order to prioritise spending on other areas
that matter to Islanders, such as healthcare and children.
The reason we are able to do this is because our pension system is in such a healthy position.
Put simply, there is enough money in the funds. That means that, for a few years, we can move
the spending elsewhere, while the fund will continue to grow. This will enable us to invest now,
without having to raise taxes or contributions.
This means we can make crucial investments in our health service and in our Children’s
Services, expand the support we give parents through the provision of free childcare, and
extend our support for healthcare to more pensioners.
This includes:
- £28 million investment in Healthcare – including more money for preventative healthcare and
digital health systems
- £8 million to improve Children’s Services to make improvements, ensuring that provision is at
the standard Islanders expect
- £3 million to expand free childcare to 2- to 3-year-olds
- £2 million to support Islanders and strengthen communities by expanding eligibility for the
Pension Plus scheme, helping struggling parents with the cost of the new school year,
improving access to services and activities for disabled Islanders, and working to develop a
workplace pension.
A temporary reduction in the States Grant to the Social Security Funds unlocks the money to do
all this – without compromising our ability to pay pensions.
For the future of our pension system, it’s important that we make Jersey an attractive place for
people to live and work for future generations, and these investments will help to do that.
I want to ensure that Islanders have clarity and confidence in how their social security
contributions are managed. There are two funds: the Social Security Fund, which is used to pay
current pensions and benefits to Islanders, and the Social Security Reserve Fund, which is there
to ensure that pensions can continue to be paid in the future. Together, these funds form the
backbone of Jersey’s pension system.
They are funded by social security contributions from employees and employers, and by the
States Grant, which comes from general taxation. They also earn income from investments –
the Government makes investments with some of the money in the funds and the income from
these investments is added to the funds. Between 2020 and 2024 they made £748 million in this
way.
The contribution rate was set nearly 30 years ago at a time when Jersey’s economy and
population were very different, to address the impact of an ageing population. Contributions
and the States Grant have consistently been higher than the amount needed to pay current
pensions and benefits, and so over time our reserves have grown, putting us in the strong
position we find ourselves in today. These reserves continue to grow.
We need to ensure that today’s working population is not overburdened and that future
pensioners receive the support they deserve. That is why ministers are reviewing the funding
structures and getting independent advice on how to protect our pension system for
generations to come. The findings of that review will be available next year. What we are
proposing now is a temporary change in funding, for the next four years, to allow us to address
some other pressing needs for Islanders.
While other countries’ pension systems are under serious pressure because of ageing
populations, declining birth rates, and insufficient contributions, Jersey has built up substantial
reserves and continues to plan ahead.
We understand Islanders want to know that their contributions are being used appropriately
and that their pensions are secure. We take that responsibility seriously. That is why we
continue to publish detailed financial reports, commission independent reviews, and engage
openly with the public on matters of financial policy.
We welcome scrutiny and debate, but it is essential that such discussions are based on facts,
not speculation and opinion.
Islanders deserve confidence in their institutions, and we will continue to work hard to earn that
trust.
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