Building A Diverse Economy

Minister Allinson & DfE CEO Mark Lewin appear before the Economic Policy Review Committee of

Tynwald Court chaired by Claire Christian MHK


F R O M   H A N S A R D:-


The Chair: Could you confirm what is your overriding strategy for building a diverse economy?

The Minister: The overriding strategy for building the economy is very much being developed

at the moment in terms of the overall Economic Strategy, which KPMG is feeding into. In terms of

building a diverse economy, obviously the Business Agency comes up with a huge number of ideas in

terms of policy and direction, so that is supporting what we have in terms of the e-gaming

sector, in terms of the finance sector, particularly the insurance sector, and we know the

contribution they make to GDP. Also looking at the whole business sectors … the whole range of

them, in terms of construction, looking at new sectors that might be available such as medicinal

cannabis, which has been at the forefront of some of the programmes that the Department have

been leading over the last two years, and then looking at actually bolstering some of the

underlying foundations of our society, such as hospitality, the retail sector and also the childcare

sector.

We are going to be making a statement to Tynwald next week in terms of a Childcare Strategy

because, driving forward, that is certainly something that the industry has been very interested

in, in terms of driving the future economy – how we cater for those people already here, but also

attract more people to come to our Island, because the demographic changes here show that we

need to create a more active working population. We have seen from the recent census data that

we have grown by about 2,000 people over the last couple of years, but certainly, looking forward,

there is still a perceived skill shortage on the Island. We have record low unemployment but

record high vacancies, with over 1,500 vacancies currently available for workers, and so part of

our key priorities is to try to fill that gap so that we can drive the economy and allow those

companies that are here to function, but also to expand in the future.

Q8. The Chair: There is a great deal of emphasis on waiting for this report, but the Department must

have a strategy before this report, (The Minister: Absolutely.) so what has that strategy been

to build the diverse economy? There must be –

The Minister: Please do not get me wrong. We are not waiting for a report. The report will

show the direction for the whole of Government. What we have been doing over the past couple

of years, particularly through the Business Agency and also the Finance Agency and Digital Agency,

is responding to industry, growing the various sectors that are here, reinforcing them – particularly 

during the last two years with the COVID pandemic, making sure that they literally survive in some

cases, but also thrive.

The diverse economy was here already, and again the Department for Enterprise is trying to

enable that through a whole range of levers – whether that is changing legislation to allow for

medicinal cannabis, whether it is through financial support for some of those firms to bring

graduates over here, for instance, or expand their premises, or develop more energy-efficient

offices for themselves. So it is reinforcing those people who are here, also looking out to

companies that want to relocate here and may need grants for that. Part of it is promoting the

Island on a world stage, and we have been doing that through various business meetings and

finance organisations. Part of it is actually looking at those diverse companies we have here and

allowing them to expand and thrive, but also looking at attracting new companies here as well

through either financial support, through logistical support or sometimes legislative support.


Q9. The Chair: Thank you. How are you actually going to create jobs?


The Minister: The Department will not create jobs. The Department will enable firms, companies and

businesses to create jobs on the Isle of Man –


Q10. The Chair: And how are you going to do that?

The Minister: – and there is a range of ways that we enable that. Part of it, as I said, is looking

at the skills mix, and we will be coming back with a Skills and Workforce Strategy to ensure that

those firms that want to take on new workers with particular skills get the workers they need. Part

of it also is through financial assistance – if they need to expand their premises, if they need to

have business adaptations. If they need to take on new staff, we can give them a whole range of

funding to allow them to bring, for instance, graduates to the Isle of Man and actually expand

those job roles there. We also work very closely with the Department of Education, Sport and

Culture in terms of making sure that some of the vocational training schemes on the Island are

accessible, that our own people who are resident here can get the skills that they need to take up

those roles. That is how we fill the vacancies, but also how, by giving targeted support to particular

sectors and particular businesses, we can create more jobs. In fact, in March Tynwald we will be

laying a paper looking at the Financial Assistance Scheme, which benchmarks the number of jobs

that have been created through that scheme as an outcome. That is not the only outcome,

because there may be certain businesses that do not create a huge number of jobs but create a

huge amount of wealth that adds to our GDP, and it is trying to get the balance right as we move

forward.


I do not know whether you would like to add anything else?


Mr Lewin: I guess, tying both those questions together, across all the different areas of the

Department there are individual plans in place. The Finance Agency has its road map for this year,

and it has set itself out in terms of promoting the Isle of Man and talks about further outreach

across key, core jurisdictions; the Digital Agency has its road maps and plans and projects, and

again there is an element of promotion in there – which markets; and each of the areas in the

Registries have their plans. But in terms of then translating that to … It is all very well promoting,

but the businesses then need … where they have growth, we need to be able to help them get

people – and that is where the Locate Agency comes in, in helping support campaigns – and then,

behind that, it is about making sure that when people are looking at the Island, actually it is an

attractive proposition in its broader sense. So we have to take the whole life cycle. We are there

to support the business growing, we are there to take the ideas that help existing businesses grow

and new businesses as well and new sectors, but then also in terms of the skills and the workforce 

and then also in terms of the environment. I think we have to look at it in the end-to-end

perspective.


One of things KPMG have already said – it came out in the first phase – is ‘a small jurisdiction’.

We actually do have a relevant, broad, diverse set of sectors: 26 roughly different sectors of

reasonable size. For a small Island, that is quite broad. We have had a lot of growth over many

years, however, probably in a smaller number than we would like, and I think when we talk about

diversity it is important to recognise we have to absolutely protect what we have got. There are a

significant number of fantastic jobs and fantastic businesses here and we need to look after them

against ever-changing shifts and challenges, but we also do have to help find new businesses, help

find new sectors, and we have to be careful that that balance is right.

Clearly, at an economy level, at a Government level, we have limited resources bandwidth, and

on one hand we are very keen to spend a lot of our time and efforts supporting what is already

here, where they can see ideas for new markets, for new customers, for new products – or,

indeed, if it is Government getting out of the way or changing a policy or legislation in support of

that; and at the same time, then looking forward a bit, and the KPMG as much as anything, the

new Economic Strategy is helping look much further into the future, to help do some of that

forward planning in terms of where we might be in a number of years and what are the things we

need to do to navigate towards that. But right here, right now, every area of the Department has

plans in place, they have priorities and they have key outcomes set against those in terms of

economic outcomes, in terms of jobs, people, businesses, but also in terms of the broader

environment.


Q11. The Chair: Thank you. Keeping it still quite simple, how are you going to measure economic success?


The Minister: There are a range of simple KPIs that you can introduce. You mentioned jobs, for

instance, how many jobs are created.


Q12. The Chair: Enabled. (The Minister: Sorry?) Enabled – to your point.


The Minister: Absolutely – well, jobs created, so jobs created by business, sorry, not by the

Department.


We also look very closely at the overall contribution to the economy in terms of GDP, and work

very closely with Treasury looking at the number of people who, for instance, are registered for

tax, the number of companies based on the Island that are functioning and paying VAT. All these

metrics can show how you are growing your overall economy.

But we also noticed, particularly over the last two years with COVID, that a lot of the

companies – particularly SMEs, which are the backbone of our economy in terms of jobs on the

Island – were struggling in terms of their business model and in terms of their adaptability. So one

of the things we are keen to promote is support, both logistical advice/mentoring of those

companies, but also financial support, to allow them to adapt, to allow them to develop to perhaps

a different business environment than existed back in 2018-19.


Mr Lewin: Just building on that, absolutely the high-level … many countries around the world

would measure it in terms of GDP, and it is important but it clearly has a less direct relevance to

us, in terms of the way that we particularly drive Government income, but we have growth in that

perspective.


But if we look at the economically active, which we have seen in the census, over the last five

years we have seen growth back in the economically active population, and that is really good. At

the same time, we have seen migration, and migration generally over a number of years is back

in a growth trajectory, which is really good, and that all translates back to particularly Government 

income, and Government income through a really difficult and unpredictable two-year period. It

actually has responded and rebounded quite well.

So there are a variety of measures. It is not always just about jobs, but it is, again, the end to

end of how you look at the whole healthy economy. All those indicators, certainly from where we

thought we might be two years ago when we were doing some predictions, to where we are

today … I think we are as pleased as we can be in terms of the general direction of some of those.


The Minister: And I suppose we have mentioned COVID because it has dominated what the

Department has been doing for the last two years, but also it has created a bit of space to again

contemplate and reset what we want out of the economy. In the past, it has been driven by GDP.

We now know that actually making the Isle of Man a good place to live and work is equally as

important as some headline figures on a spreadsheet, and so it has to be that balanced economy

as well as a diverse economy, so that we can weather storms but also create the prosperity and

the jobs that people need.

Q13. The Chair: Thank you. I am just going to move a little bit more on to the KPMG Economic

Strategy. On the Government COVID-19 website, under the Economic Recovery Programme section, it

says:

The KPMG Economic Strategy … will be constructed across five key phases; the Economic Vision,

Macro Economic Research and Review, Development of Policy Levers, formulate a Strategic

Framework and Establish a Monitoring Program.

This is not to catch you out in any way, but in the Island Plan it says on page 11 that you will

‘complete the four phases by June 2022’, so can you just advise – is it five phases or is it four

phases? Is one blended into the other? Is it an error in the Island Plan?


Mr Lewin: If I may, there are five phases. The fifth phase is about a monitoring regime, and

that follows when we have agreed what it is we need to do, how we are going to do it and just in

terms of sequencing the priorities. So there is a fifth phase beyond July, it runs into about

September/October, and it is about establishing the monitoring regime and making sure that what

we are left with is not just a document but is actually living and breathing and we have the

governance around it and the ability to make sure it is taking us in the right direction.


Q14. The Chair: So there are five phases, and the fifth phase will complete later on in the year?


Mr Lewin: September/October.

Q15. The Chair: Thank you. Have KPMG sampled a fair cross-section of Island businesses – not just

large entities but also small businesses, too?


Mr Lewin: They have certainly done a lot of outreach, and this has been going on for 12 months

in different guises. There are a number of different forums that have fed into that, from individuals

a year ago – and there were about 70 individuals. A cross-section of the economy fed in, in terms

of ideas. Then, as they have gone through into specific topics, they have done outreach to a

broader section of people. For example, they did the tourism one six weeks ago, and there was a

much broader church of people involved in that, talking about the future and what it could look

like, and it is the same across different aspects. So yes, there have been some big entities involved.

There have also being the Agencies, there has been the likes of the Chamber of Commerce, and

there have been other formal bodies that have fed in as part of that, but also, depending on what

the topic is, there have been other people who have fed in directly to KPMG as part of some of

those workshops.


The Minister: Yes, and I think you make a very good point because the benefit of having a

diverse economy is you have a whole range of people out there doing different things in different

ways. The issue that we have in terms of Government is reaching them and hearing their voice,

and that can be very difficult, sometimes, particularly given the preponderance of small and

medium-sized enterprises, who are busy working, who are busy providing services, making

money, and do not necessarily have the time to go to workshops.

One of the things that we are very keen on doing is working with the Chamber of Commerce

to try to allow them to act as a representative. Just this week I met with their Local Economy

Group, which they have set up to try to harness the voice of those small businesses on the Island,

which is equally as important as some of the large businesses. We know, when we look at some

of the big sectors such as e-gaming and finance, and particularly insurance, it contributes a huge

amount of GDP, but actually, when you look at who provides the jobs it is often hospitality and

retail. So it is trying to get that balance right in terms of representation and hearing all those voices.


Q16. The Chair: Thank you. You described earlier the KPMG initiative as the first time the Island has

looked at its economy and the available levers. We have been here before, in the late 1950s and 1960s

when we went 350 into the finance sector. Will the KPMG initiative lead to a similar dramatic

transformation, are you hoping?

The Minister: I do not think it will be as dramatic as back in the 1950s and 1960s, because our

economy has matured far more – the world economy has matured. Some of the initial responses

from KPMG have been looking at priorities and emphasis. It has been looking at synergies between

different sectors in terms of offerings. It has been looking at growth opportunities. Throughout a

lot of their work has been the sustainability agenda, as well, and actually providing what we need

on our Island, in terms of renewable energy, to drive business forward. So I do not think it will be

such a seismic change. It will suggest certain new sectors, particularly in the digital realm in terms

of data, and that will certainly, I think, help us move forward with new offerings. But I do not think

it will come up with any revolutionary new idea which will completely change our economy in the

way that the introduction of various parts of the finance sector did in those years, because since

then we have become far more of an interconnected world, and so a lot of the things we did in

the 1950s and 1960s other people caught up with the 1970s and 1980s.


Q17. The Chair: Thank you. What is the deadline to the KPMG report? And when might we expect to

discuss this in Tynwald?


Mr Lewin: It will be for July’s Tynwald. It will be finalised and published in June.

Just to build on the question before, KPMG have been openly procured as a professional in this

space. There is some local expertise, but importantly there is global expertise that is feeding into

this across various different subject matters, but ultimately this will be Government’s economic

plan.

In terms of the scale of change that we might wish to see, as the Minister said, actually we

have a relatively healthy economy. We have some real strong foundations. Yes, there are some

areas we need to attend to, but we need to look after that. But in terms of how far you go, it will

partly depend on the ambition we collectively have. It will be subject to debate and it will not just

be a consultant report that says ‘This is what you need to do’. It has to be part of this

administration’s … It is your plan and says how we take the Island forward.

Q18. The Chair: Thank you. Will it be in time for the six weeks of business for July? 


Mr Lewin
: That is one of our challenges, but absolutely we are aiming for that at the moment.


Q19. The Chair
: Mr Lewin, you are CEO of the Department, but you jointly serve as the Chief

Operating Officer in the Cabinet Office also. How do you balance the two roles?

Mr Lewin: I do it as best I can. There are real synergies and I think if I just put it into context:

when COVID happened we needed everyone, and everyone did step forward to help. I became

part of the centre in terms of that response, and I have continued. Part of the role of the Cabinet

Office is still as we go through, hopefully, what will be the final stages of our management in this

space, making sure we see that through to fruition.

There are other roles as part of the Cabinet Office that made sense at the same time to look at

and the GTS digital portfolio ties exactly to what the Minister was talking about in terms of a

forward-looking digital economy. Climate change: again, as the Minister said, sustainability is a

hugely important part.

So there are some real synergies in terms of the two roles, but absolutely on a day-to-day basis,

I am the Accounting Officer for the Department for Enterprise, that is what we are here to talk

through today in terms of the areas. There is a really great team in the Department for Enterprise.

Across all the different areas there is a strong leader in place out there that is leading their own

area; and the same in the Cabinet Office where there is a strong team of people in place.

Sometimes from my perspective it is just helping to make sure that all the relevant aspects are

moving along at the right pace and to make sure, again, the vision and the general direction is

there.

The Minister: When I started the conversation, I said that I was aware of the DfE’s profile and

a lot of that was working with Mark through the pandemic.

It has often been the ambition to get away from siloed Government and Departments acting

on their own. What COVID has shown is that by working together we can achieve a lot more. Mark

will often check with me that I am happy with his dual role and I certainly am.

I was hoping that as we got through the pandemic we would have a chance to relax and

regroup. Unfortunately, due to the war in Ukraine, we have been thrown back altogether. Again,

in terms of navigating the economic and human effects of that, I think the collaborative working

that we developed during COVID will continue. But we just need to make sure that we do not get

burnout of some of the people involved, and we look after them through what will be a very busy

period over the next couple of weeks.

Q20. The Chair: I see you are the only Department that has two Deputy CEO roles. Is that to

support you? Do you feel that is one of the reasons, because you are split over the two, you need

the two roles to support you?

Mr Lewin: Yes, absolutely. Again in the context we did it at a point in time – and also the change

of administration coming in – that would then give an opportunity to look at what generally the

administration wants going forward. As I say, there is a good team in place but, yes, behind that

having to make sure the Minister has always got access to … The way we do that, regularly, it is

not just me that speaks to the Minister, we have an extended team that can access, not just the

Minister and Members, on a regular basis. Multiple times a week we check in as a whole team

and make sure everyone knows what is happening.


Q21. The Chair: I feel like we are probably going to keep facing problems as we just live in this

day and age. How do you see your role developing, Mr Lewin? Do you see you would keep

maintaining oversight over the two Departments? Or do you see, hopefully, a future where you

have one area or …?


Mr Lewin: It always has been the position, this is what we are doing right here and right now,

keeping it under review. As the Minister said, there are aspects of this that work really well, in

terms of Government working really close together. But, equally, there are aspects where we need

to make sure that the relevant areas have the relevant time, attention and direction.

So I suspect nothing is off the table. Right here, right now, that is where we are. We will

continue to work as best we can in that space.

The Minister: Yes, because at the same time that we have two Deputy CEOs, we also have four

political Members, which is probably larger than most of the other Departments. Each one of

those is allocated one of the Agencies and, again, it is to try to have that political input, political

oversight of those sectors, but also to allow for the businesses in those sectors to feed in to

Government, basically. That has been very important in terms of working as a team, when you are

dealing with such a diverse portfolio of different sectors and different priorities.

Q22. The Chair: Thank you.

Just moving a little bit on to the Executive Agencies. When the Executive Agencies were first

announced the then Minister, Laurence Skelly MHK, said in his media release:

It is intended that together the boards will contribute to a centralised Economic Advisory Board that

will feed directly into the National Strategy Group, impacting decisions and direction at the most senior

level. Could you tell me more about the Economic Advisory Board, and when did they last meet?


Mr Lewin: It was very much a feature of the previous administration and I do not have the

dates to hand as to when it last met. It met a number of times, but then obviously COVID came

along and to an extent the Economic Recovery Group took over a large proportion of that. That

met, sometimes, every day; sometimes multiple times a day. But it would meet regularly and it

stepped into that space.

In the new administration there is an Economic Strategy Board now in place. Underneath that

the intention is to set up one aspect, led by Treasury, that is looking at our economic policies and

looking at the long-range views that will build on what we have been talking about in terms of the

strategy; and more of a liaison body that is chaired by the Minister for Enterprise that will look at,

actually, are we going in the right direction, what is happening, and essentially the delivery of that.

That will very much bring back the Chairs and bring back the Agencies, and bring other bodies and

other voices into that space. One of the great things about Island communities is that there are a

lot of people who want to be involved and want to give their time, whether that is in social or

volunteering, but in a business perspective as well, and we need to harness that. So that is very much

one of the things we are moving towards now. In terms of bringing it

together what I would also say though is each of the Agencies come together regularly – the

Chairs, the heads – every two weeks. But also at a Department level. They are in every month and

they talk with the Minister and with Members, and that is about what each of them is doing, what

challenges they are seeing and how they face that.

I think that the Liaison Board, or what was the Economic Advisory Board, will now change

shape. Again the strategy will help feed that. But they have other things that have stepped into

that space, particularly over the last couple of years, to make sure that we are bringing together …

As the Minister said, it is not silos. Yes, there is an issue in one area. We cannot just fix that in isolation.

We need to look at the totality of that and we need to prioritise.


Q23. The Chair: It sounds to me like the Department is changing, and developing, and evolving,

and especially it seems to be that this is changing very much so in this administration. Can you just 

give us a little bit of an idea of how you are evolving it now and what you see is going to be

different?

The Minister: When I started at the Department for Enterprise what I saw was a well functioning

system that did not need radical reform or reorganisation. As you say, the Agency model had been set

up several years before and so it was absolutely right to review that structure and the function of the

Agencies and also the outcomes. That review happened just before I started. We have then looked at

various other reviews, looking at the organisation of the various Agencies to refine them. Not

necessarily to change their function but try to prioritise what they are doing to actually get shared

governance across, to make sure that they have the right resources to meet their targets and deliver on

the programmes that they have started.


Moving forward, also, that the Agencies should work together. So, for instance, one of the

things we have set up is an innovation hub to particularly tie the Digital Agency with the Finance

Agency. So moving forward, we can give the businesses on the Isle of Man new products and new

ideas, and use logistical support to digitalise their service to hopefully expand into different fields.


Q24. The Chair: Would it be possible to submit that review to us regarding the Agencies?

Mr Lewin: Absolutely, yes. We have a variety of things we have done. The Agencies themselves

are bodies predominantly supported by the private sector, giving their time voluntarily. They have

all gone through a cycle of really looking at the plans. As I said before, road maps are in place.

I think it is a really appreciative sign that each of the Agencies … I think Finance went through a

renewal and changed some of its members, and people came forward.

The Digital Agency then went through a process and had an open advertisement, and it has a

new board. They have kept some members and got some new members, but people came forward

with new ideas and wanted to participate. And latterly the Visit Agency has done that. But that

then gives each of them an opportunity also to look at where we are going, to make sure that the

views are right and the general direction is fully supported.

You said about change. That is one of the fantastic things about the Department for Enterprise,

it meets people on a daily basis who have got new ideas. It sees challenges on a daily basis and

we have to react to them. And it will change. The economy is changing, the environment we are

in is changing and society is constantly changing. So potentially nothing that we do is fixed in

tablets of stone. It is very adaptable and that is one of things we just need to keep doing. But we

will share this …

Yes, we had an independent review of the Agencies. We have had other assessments done of

them. The Visit Agency had an assessment by PwC about three years ago, which came out with

some really good strong points, with recognition that it brought together private sector and

Government individuals in a way that has not been seen before. But again there were some

things – it talked about improvements in terms of governance and records – and those are being

taken forward. But we will share all that.

The Chair: Thank you.

The Minister: And, if you do not mind, Chair, it is not change for the sake of change. It is making

sure that we as a Department, and the services that we provide to the economy, are up to date

and relevant. As people’s needs change and as the support they need changes, we need to

respond to that.

The Chair: Thank you. Mr Wannenburgh, do you want to ask a question?


Q25. Mr Wannenburgh: Yes. The recent census report is suggesting we are losing one out of

every two young people. What are we doing to address that, in terms of getting jobs for young

people in different sectors?


The Minister: Again, the demographic of the Isle of Man is often a difficult read and there is no

single option for how you either attract more people back to the Island who have left, or attract

people who have not been to the Island before, to come and stay. What we are doing in terms of

the Department is we have graduate recruitment schemes and we actually have a Graduate Fair

coming up next month, where various industries will advertise to graduates the roles that are

here, the jobs that are here. Through the Locate strategy we will be very much publicising that.

We have relocation grants for graduates who come back, which include NI holidays and which

include some subsidies to the employer to bring those people back. Those are direct subsidies.

We work closely with the Department for Education, Sport and Culture so if those people could

train on Island, doing vocational training, we as much as possible will support them so they do not

have to go across and they carry on being on Island. But wider than that I think we need to create

the right environment so that young people want to come and live here. Part of that is simple

things, like I said, financial support to the hospitality industry and making sure we have a vibrant

night-time culture here so this is an attractive place to come and live and work.


One of my issues with my own children, both of whom are off the Island at the moment, is

when they come back that they are not bored, that they have the same facilities here that they

would expect; that they have the income that allows them to enjoy the wonderful countryside we

have. It is promoting the economy so we have that standard of living, I think, that is very

important.


But in terms of encouraging younger people to come back, I do not know whether you have

got anything?

Mr Lewin: I guess, just to add, one of things that the Economic Recovery Group, the

Department for Enterprise and Treasury jointly have, is the internship that we took last year and

indeed before then, encouraging employers to take on young people. It was hugely successful and

we saw people matched, and then people staying beyond the original placement. It is one of the

live conversations we are having now in terms of what this summer should look like, in terms of

making sure there are opportunities for our young people.

The challenge, as the Minister said at the outset, is we have record levels of vacancies – at

about 1,500 – and we have record levels of unemployment and jobseekers. We do absolutely want

to encourage those who are here to be working. There have been countless surveys over the years

in terms of why young people perhaps do not come back. But jobs, not understanding or believing

there is a job for them, typically comes out top. Then, as the Minister said, the broader environment

comes out quite quick behind that. We need to work on both of those. Things like the Graduate Fair, and

we have talked more generally about a young person’s fair, when the childcare strategy – we will talk

about that next week – but it talks about finding improved pathways for young people into that industry.

The Workforce and Skills Strategy, as the Minister said before, which will come forward later in the

year, also has some themes about young people and making sure they have got choices, and that the

choices are attractive enough. There is another angle of why is that …? And many people choose to go

away. That is for their own reasons, for their own development, and for their own opportunity to see a

bit more of the broader world. But we do want, and at some point we hope they will come back –

making sure they have got a pathway and there are some incentives, and they are eligible for the same

incentives as anyone. It is finding all that in balance. But in the last couple of years we did see

more people come home than we have done previously, and that was really welcome.

Q26. The Chair: Thank you, gentlemen. We have got a lot to get through today, so if we could

keep our answers just a little bit more succinct. 

We are moving on to part 2 now Microbusinesses, Support and Growth. The pandemic

revealed our Island is home to a patchwork of ‘micro-enterprises’ and ‘self-employed ventures’.

How is the Department responding to this trend and what are you doing to monitor and look at

this patchwork of enterprises and supporting them?

The Minister: You are absolutely right and, as I said, they create not only the jobs, they also

develop the skills of those people who work in those industries and hopefully they will grow and

expand. There are two aspects to that: one is to support those who are already established, and

we have a range of financial assistance schemes that can allow people to expand to take on more

workers and to expand their own premises, to adapt and perhaps go online. But we also have the

Micro Business Support schemes, which actually look at those people who want to start off in

business for the first time: giving them the right training; giving them mentorship; and giving them

financial contributions towards that so that we can actually develop those new businesses.

As you probably know, when you get new start-up businesses, not all of them succeed at the

end of the day. It is very difficult in any jurisdiction to sustain new business without the right

support, both logistically and financially. So we will try as much as possible to guide them on that

path.

Q27. The Chair: Thank you.

In light of that and you are talking about different support, etc. I would encourage you, if you

are not aware of this, but the ‘Invest in Cardiff’ agency, I am not sure if you have ever looked into

that? They offer a tiered support at different growth stages of business, and that is something

that is not just about new businesses, it is about growing the existing ones and it is having a tiered

system, and whether that is financial or economic advantages to help them.

Do you think that the Department could be doing more to really be looking at 70% of our

businesses? These are those small micro businesses. Do you think the Department could be doing

more to really lift them and grow their businesses?

The Minister: I think we can always do more within the resources that we have. In terms of the

tiered structure, we have that and we will support people who are starting off with just one or

two people who are creating a brand new business. But also support them if they want to expand,

if they want to take on new workers and if they want to move to bigger premises. Certainly that

awareness of the local economy I think came to the fore over the last two years as they struggled. One

of the issues that we have touched on before is – because we have such a diverse economy and because

often these people are working extremely hard and they do not ask for support and they do not ask for

help – they perhaps do not get on the radar. One of the things hopefully we have managed to do is

promote some of the schemes that were available and expand the schemes that are available to small-

and medium-sized businesses, so that we can support them and they are aware that the support is there.


Q28. The Chair: I think that is essential, the communication to drive that. So in terms of the start-up

enterprises, what would you say the Department does, as the next stage? Here is your chance to tell the

Committee what is the next stage for that small business, that start up? How do they then become a 10-

person business or a 20-person business? It is not just about helping them with the premises, (The

Minister
: No.) it is not just about bricks and mortar. It is: what education are we doing …?


The Minister: Absolutely. The Micro Business Support scheme actually gives – is it 16 hours?

Start-ups?

Mr Lewin: It gives a living wage, they give mentoring around that, and training is part of the

business plan and the forward look on that. 

You talked about businesses succeeding and growing. Typically, when they measure – about

18 months after the first applicant comes in – 93% of those businesses are still going, which is a

fantastic accolade. And it has had some really strong feedback. The previous Economic Policy

Review Committee looked at it and made some suggestions more generally, but it is a real scheme

that we are really pleased and proud of, and a lot of people have benefited from it.

Your point is the next stage of that … The Department has a whole range of other schemes

under its financial assistance which includes access to consultancy, business advice, marketing and

web development. There is a whole range of other things businesses can tap into, and when they

are on that pathway that is one of the things we do with them to make sure they understand some

of the things that they can do next.

Is there an opportunity for some sort of accelerator for certain businesses? Absolutely. We

have looked at it before and it is probably time again to look at it, post the Economic Strategy.

One of the broader aspects – and just to put one of the challenges we have – a lot of what the

Department previously did was principally around export-facing businesses. It was about focusing

off Island to bring investment back on Island. But if a Government steps too far into a domestic

economy, where you have got businesses competing next to each other, then it can have a

disproportionate effect and all you end up doing is fuelling competition.

Clearly the micro business goes beyond that and is available to all sectors. It is one of our only

schemes that does that. It does not matter whether you are in a single domestic economy and

you are competing with somebody else, we let you choose to start out on that business. As you

said before, increasingly the trends are people wanting to do that. But there is a limit where

Government probably steps right into a domestic space and helps one business compete directly

with another. It is just about finding that balance.

Q29. The Chair: During COVID, it was really identifiable that the Government – and the

Department for Enterprise, in particular – did not really understand all of the sectors because

there were lots of sectors being missed off in terms of support. So what have you done since then

to make sure you are capturing all of these sectors and really giving them the support?

What have you done since then to formulate that?


The Minister: As Mark has said, the relationship with small businesses is very much an ongoing

relationship rather than just start-ups and then letting people flounder.

In terms of your question about COVID, I think you are right. There were lots of people in the

local economy who never touched the Department for Enterprise. They did not see it as

necessarily relevant to them, and did not really respond to some of the workshops we were

running and some of the programmes we are running, because they were too busy getting on with

their job. What COVID showed was actually a need for some of these companies to get that advice,

to get the business adaptation that they often needed to bring in quite quickly, and so we were

able to provide that.

But it is all about communication. I think one of the things that we have learnt as a Department

over the last two years is the importance of that two-way communication with all the various

sectors. We cannot make people work with us, we do not want to force ourselves on anyone, but

we want to make sure that they are aware of what is available should they decide to make use of

it or should they decide they do actually need it.


Mr Lewin: If I can, we saw a number of structures come out of that at the time, as a necessity –

for example, the likes of the Restaurant Association – to understand, and that has continued.

We had a really strong relationship with the Chamber of Commerce before, but it was never

as strong as it was through that period and is now, because they helped bring … Sometimes when

Government steps into a space, people do not necessarily want to engage in that. But when

industry itself mobilises and when the likes of the Chamber of Commerce came … We just recently 

had 11 workshops, about 500 attendees, over small businesses, looking at ideas and looking at

what more Government can do in terms of the environment, and removing some of the barriers.

So those structures will continue; the dialogue will continue; and we will never stop listening

and trying to work harder to understand what we can do to make the Island a better place, and

support those.

The Minister: That relationship was incredibly important during COVID, because those people

helped us devise the support schemes. You are quite right that when we started off we did not

reach everyone, so we adapted those schemes and continually adapted them, and are still

adapting them now as we hopefully come out of the pandemic, to make sure that they are

relevant and accessible to everyone who needs them.

Q30. The Chair: The Chamber of Commerce, you have talked a lot about them this afternoon.

Can you answer me: does the Department actually fund the Chamber of Commerce in any way?

Mr Lewin: No, not directly. We do participate with them. We have a joint venture through the

Eagle Lab where they are obviously the tenant down there and we work with them in that space.

We have from time to time supported them on specific initiatives. We helped them through a

concierge service a number of years ago where they were going to provide the landing zone and

the dialogue and supporting people when they were here. But not on a day-to-day basis. No, the

Department does not do that.


Q31. The Chair: And financially, there is no financial support?


The Minister: In terms of financial support, the only one I know of is through the Eagle Labs in

terms of sponsoring that in conjunction with Barclays. I think it is very important that the Chamber

of Commerce is independent and is not seen as part of Government: (1) for their own integrity,

but (2) so that, when they need to, they can criticise us. It is absolutely right that they are the

authentic voice of part of the business community. They are not the only voice, but certainly they

are an organised voice. We are more than willing to meet with any of the representatives of

businesses, or the businesses themselves, on any occasion.

Q32. The Chair: Thank you. Can I just ask one last question in this section?


How are you going to collate the data in terms of businesses and small businesses, or all

businesses on the Isle of Man? Are you looking at capturing that in a dashboard, in any way, or

something that can be visible? So you could say this percentage of the GDPR is to this sector, etc?

Are you looking to develop something like that?

Mr Lewin: The Economic Strategy, one of the deliverables in there is an economic model. We

have not had one before that allows us to plug in scenarios and see what the effect of that could

be. As part of that – as the Minister said before – we have brought more data together than we

have ever done before, in terms of understanding. That needs to survive and we need to be able

to monitor it going forward. So as he said, the fifth strand of the strategy is about monitoring.

So when COVID came – and I know we keep coming back to that – but it did show how it was

really difficult to understand at a real-time level what was actually happening. Other than

jobseekers, which is pretty real-time. But a lot of tax data, and some of the other Government

incomes and data, falls behind. It lags quite a lot. However, I have to find a balance, because if we

go out and Government starts asking … We had this direct discussion with the Chamber of

Commerce, who said ‘You have got to stop asking us questions. We have got a business to run.’

Sometimes we need information and at other times we need to let the businesses get on, and

we have to try and find that balance. But absolutely, improving data, being able to make intelligent 

decisions and using knowledge should be part of what we are trying to do going forward in the

future. It is what a business would do, increasingly, and it is what Government tries to do.

So we have got some good foundations, but we can always do more.

The Minister: I think there is also the element of trust and, unfortunately, a lot of small- and

medium-sized businesses did not trust Government to show them their books, for instance: ‘What

is your income like this week?’ ‘We’re not going to tell you.’

So it is trying to build that trust, which I think is going to be incredibly important going forward

and hopefully, with the support that we have done, with the communication we have done, we

have shown the willingness to do that.

The Chair: Thank you.  Mr Moorhouse.


Q33. Mr Moorhouse: Just in terms of data, it is really good if you are actually managing it and

controlling it and analysing it. It is good that you are going out and talking to these businesses.

What are they suggesting in terms of their issues and the real problems that they are facing?


The Minister: I think you are probably very aware of those, in terms of talking to your

constituents. At the moment coming out of a two-year, very difficult period, some of it is cash

flow, some of it is bills, some of it is the debt that they have built up during that period. Looking

to get back to normal or, hopefully, expand its workforce, it is getting certain skills as well, which are

difficult to find at the moment – not just on our Island but right across the developed world,

because of the seismic shifts that we have gone through. It is then developing that business model.


Also, often, a lot of the visitor economy on the Isle of Man is very dependent on tourism and it

is trying to open up those links again to get tourists over here. So it is a whole range of issues that

people are facing. Some of them are very common, some of them are specific to a particular sector

in terms of, for instance, banking requirements or the ability to do online payments. So it is just

responding to all these different requests and seeing how we can support businesses in the best

way possible.

Q34. Mr Moorhouse: One of the issues for society is housing – access to housing and the cost

of housing. Is that something that businesses are saying to you is an issue for them, or is it

something that is really beyond –?

The Minister: I think it is an issue, as you say, that goes right across our community. But

particularly when we have been talking to the hospitality industry in terms of getting workers

over, often who work long hours, one of the issues for them is where do we put them? Where will

they stay? Different businesses have responded to that in different ways. Some have gone out

and purchased property. Some have reconfigured their own hotels to provide accommodation

and others have looked at trying to subsidise rents for people when they come over here.

So, yes, it certainly is an issue and again one of the issues that we touched on right at the start:

growing the economy. You can only grow the economy if people have a place to live when they

are over here. That is why, at the heart of the Island Plan, setting up the Community and Housing

Board and looking at it as a whole is very important. Not just for people who live here, who want

to get on the housing ladder for the first time, or on to affordable rents, but also as we grow the

economy and get more workers coming over here, we have got to have the infrastructure to

support that.

Mr Moorhouse: Thank you.


The Chair: We will move on to part three now, Competition and Demographic Trends. So over

to Mr Moorhouse.


Q35. Mr Moorhouse: The first question I am thinking about is Mr Wannenburgh’s point on the

census. In terms of the data that is coming through, is the Department looking at that and trying

to make it relevant to business and encourage business to focus on certain areas, or is it just

something that would be too much for you to go into?


The Minister: I think we are always aware of the demographic data. I think businesses

themselves are aware of it. They know their customers probably better than we do. If you talk to

people who are starting up new clubs, bars or restaurants, they need to know that not only do

they have the clientele, but those clientele have the available income that they can spend in those

businesses. So I think it is very important that we know about the demographics.

Also, it is very important that we create the right climate in terms of consumer confidence,

that people do go out and use local businesses. Certainly the way we are trying to encourage more

people to shop local, to eat locally and to go out and support the local economy is incredibly

important as we recover from the last two years.


Q36. Mr Moorhouse: One of the key changes has been working from home. Is that seen as

continuing and you supporting it, because there is that planning …? It seems to be the case that

more and more applications are going through so people can work at home, can build a business

at home. Is this something you will be pushing, or is it just something that is there?


The Minister: During the pandemic, one of the key roles that the Department took forward

was to accelerate the National Broadband Strategy, to try to get more people on fibre so that they

could work from home effectively when they had to.

I think you are quite right that things will never be the same again. Some people have got used

to working from home when they could, and there are some sectors where that became quite

natural – particularly finance and the digital sector, for obvious reasons. If we can provide the

right environment for that in terms of connectivity, then that can continue and give people a real

choice. However, a lot of businesses are now developing a more hybrid model. For instance,

people may work at home for a couple of days but then come into the office for a couple of days.

I think that flexible working is actually a really good idea moving forward, because it hopefully

gives people a real choice. One of the priorities that I have is reforming our employment law.

Certainly in other jurisdictions they have looked at whether they can enshrine the ability to have

flexible working as an employment right, and that is something we will be consulting on in the

future.


Q37. Mr Moorhouse: One of the key changes in terms of what the Government has done … is

to try to make town centres more attractive. Unfortunately, retail has changed faster than the

investment we have put into those town centres, and we are now at a tipping point, where people

are thinking, ‘Do I actually want to go to a town centre?’ When you go to the centre of Castletown,

it is not as attractive as it could be. When you go down Strand Street, it is not as attractive as it

could be. What does the Department actually think, in terms of this area? Is there anything else

you could do, to revitalise shopping?

The Minister: This is something that came up with the Mary Portas report, which was over a

decade ago now: how you regenerate town centres. There is a whole range of ways you do that.

First of all, you let people live in town centres. You make them vibrant again, so that after

six o’clock they are not just pedestrian waste ground. One of the initiatives with the Manx

Development Corporation is to regenerate those buildings, particularly around Douglas, where

we can get people living and working again in town centres. 


Looking more at the retail aspect, there is the Village and Town Regeneration Scheme, which

gives some support to people to regenerate the front of their buildings, to get help with investing

in their premises. We also have a range of adaptation grants and loans which can help people

develop their business in new directions. Again, we are quite happy to work with local authorities,

local communities and local businesses to try to do this. It is not just a simple fix. There are lots of

ways that you can try to incentivise people to use local products, rather than go online or go off

Island.

One of the advantages over the last two years was the Domestic Events Fund, which actually

tried to lay on activities to entice people, quite literally, into town centres and then get the footfall

for the retail sector. One of the pieces of work that the Business Agency is doing is footfall tracking,

so that we can have much better data on what works and what does not work, and then prioritise

those schemes that will actually give real benefits to those businesses.

Q38. The Chair: You have just mentioned about the Development Corporation, but actually

the first five projects are not really in the town; they are in the perimeters of Douglas, but they

are not in the actual town centre or near it. In terms of once they have completed those five, we

are looking years down the line to putting flats and apartments actually in the town centre.


The Minister: Chair, I would disagree with you on that, because the four key sites that they are

looking at, at the moment, are all in greater Douglas and what they are doing, really, is trying to

flesh out the advantages of urban brownfield site regeneration, but also look at the barriers that

might be there for private developers who want to do the same. One of the actions for the

Department for Enterprise is to analyse those barriers – whether it is planning, whether it is

taxation, whether it is simple issues in terms of rejuvenating existing buildings, rather than

knocking them down – and how we can, if necessary, change legislation, change processes, to

allow that then to cascade right throughout the business sector.

Mr Lewin: May I just add that the Manx Development Corporation has been a fantastic vehicle

for doing those two aspects: one, physically taking a site and trying to draw a conclusion to what

we are going to do with it and bringing that forward; but the second thing, as the Minister said, is

identifying the catalysts and the barriers. But the Department does liaise with other developers

and again is having these conversations about … we have a critical shortage of skills, our

economically active have been growing, we have a significant volume of vacancies, but we have

an acute shortage of housing in certain areas for these people – and people want to live in the

town centres. How can we bring all of this together? So the MDC is an important part, but it is not

the only part.

Q39. Mr Moorhouse: We got there slightly ahead of schedule, but just in terms of the MDC,

how is the Department for Enterprise working with them? You suggest there are strong synergies,

but are you being proactive? Are there meetings? Are economic trends pointed towards …? Or is

it something that is just work in parallel?

Mr Lewin: We do meet regularly. It has only had its employees since September last year, and

I think it has achieved an incredible amount within 14 weeks to get to its first planning application.

Alongside that, there are concepts and feasibility studies on the other sites, as well, now coming

forward. We monitor at the Department for Enterprise. We work across developers and across a whole

series of sites and are regularly talking to them. The MDC are part of that. Ultimately, because it

is a publicly funded body, it comes through the Brownfield Regeneration Steering Group, and that

brings together Ministers and Members from other Departments – we have the Treasury, we have

the Department for Enterprise and we have the Cabinet Office – and that is where we can really

get into the detail of ‘We have identified a barrier: what are we doing to do about it? We have a 

site here and we have some questions: which way are we going to go with it?’ So that Brownfield

Regeneration Steering Group is really critical as well. The final bit, I would say … and the Minister

touched on planning but there is a lot of narrative in the Island Plan about encouraging more town

centres and vibrancy. We have a commitment to go and look at Scotland, Town Centre First, to look at

some of our policies around conversions around the town centre development more generally, and that

is something the Department for Enterprise is actively involved with, and the MDC are part of that as

well.

Q40. The Chair: What data are they using?


Mr Lewin: In which aspect – sorry?

Q41. The Chair: What data are you going to help to provide, for them to be able to formulate

a strategy?

Mr Lewin: In terms of things like the MDC connecting into each of the relevant areas, we talked

about demographics and the census. Take the former Nurses’ Home, which they have announced.

They spoke to Education, and the Department of Health and Social Care as well, about key

workers, and more generally we have spoken across sectors about the need for that kind of

accommodation. So there is a piece of work there.

An example where the Department for Enterprise sees a gap in data would be a thing called

the Consolidated Analysis Centers, Inc. (CACI) Report – and again we can share that. A number of

years ago, when we were trying to encourage retailers – this was pre-COVID – to the Island, it was

identified that we did not necessarily feature in one of the standard industry reports that showed

affluence and demographics in towns, so the Department paid to go into that. We took some of

our data – Economic Affairs, as it was at the time, helped support that – and then we featured in

the report, and all of a sudden investors and retailers could see the Isle of Man alongside Warrington, or

wherever else it may be. So there are things … When we can identify that there is

a gap in data, one of things we can do is see if we can try to plug it.


Q42. Mr Moorhouse: Does the Department own any land or have access to any land that could

be used by entrepreneurs?

The Minister: No – as far as I know.

Mr Lewin: We have pockets. We have some areas down south. We have some land around the

Island in different places. A lot of it is actually rented out, so the Department gets, I think, £900,000

of income per year from different areas. But in terms of surplus land, no, not really.


Q43. Mr Moorhouse: Just in terms of start-up companies, one of the big problems they have

is actually accessing facilities. Incubators and various things have been set up to help them. We

have an issue in town centres, in terms of empty space.

Has the Department thought about the possibilities of bringing these two things together, so

the Department could find a way through all the hassle of private owners and their requirements,

and help vibrant new businesses set up and work in that area, or is it something that has not

been …?

The Minister: Yes, and that was the motive behind partnering with Barclays to start up the

Eagle Lab for start-up companies. You are going a little bit further, in terms of how do we

incentivise people moving into other premises. As I said, there are a range of grants and loans that

can facilitate that, but also we obviously are cognisant that people may end up having lots of other

issues in terms of utilities, in terms of getting broadband into their premises and in terms of 

planning, and by giving them the logistical support and advice they need – whether that be

financial or whether it be IT – hopefully we can support them to develop their business case.

Q44. Mr Moorhouse: One challenge for new businesses and businesses coming to the Island

is that factor of competition. How does the Department view this and retain an independent

position because we need to see a bright, shiny new entrepreneur coming along and at the same

time be thinking of existing business? How do you get that balance right? It must be a challenge.


Mr Lewin: I think a lot of what the Department does – if you think of the Agencies and you

think of our Registries and you think of things like Locate, it has been principally export facing. We

go out and we try to bring new businesses here into our manufacturing sector, our engineering

sector. So for that very reason it is less about competing in the domestic economy. We do support, and

we have talked at length about how we can support, the local economy and businesses in that space. But

typically a lot of what the Department will try to do is support those entrepreneurs that are coming here

and bringing businesses here. But often they are facing an international marketplace and that is where

the economy can really grow.

The Minister: I think you raise a very good topic because sometimes it may be seen that the

Government is enticing more and more start-up companies here that might be competing with

people who are already trying to make a living. And that can be an issue.

However, the alternative aspect of that is, when I was talking to a bigger gaming company

during the week, they were welcoming competition because it created a microcosm in terms of

that sector. The more companies that are in the e-gaming sector on the Isle of Man, the more

they could work together and they could share expertise, they could share staff training, and it

creates a critical mass that could actually make it quite productive for all of those people involved.

We have had the same in terms of the finance sector and the banking sector. I am getting

people over here to apply for a banking licence that can enhance the financial sector. But I think

you are right in terms of some other sectors, we need to be very careful that we do not favour the

newcomer to the sector and forget about those people who have already invested in their

premises and invested in their business here.


Q45. Mr Moorhouse: One key advantage you mentioned there was clustering and everything

that goes with that. The Airport Technology Gateway is an attractive location, it has been in place

now for seven years and we have struggled to move it forward. Do we really need to be looking

at businesses and what businesses want? Or, are we doing the right thing at the moment and will

the right thing pay dividends in the near future?

The Minister: Thank you for your Question in the House of Keys raising that, because I think

you are right. It was a project that has taken too long to come to fruition. The idea there is that

the Government will work with the private sector and very much develop facilities there. The

question is whether Government – in terms of Departments – are the best people to develop

properties, to help people develop business plans and provide the right premises. I think the answer to

that is we need to have that private-public partnership to take it forward. Yes, we can give the financial

support, the logistics support and look at any issues that there might be around planning, or road access

to it, but we also need to rely upon those businesses who are going to be using those premises to

actually give the right advice and develop a sustainable future for that area.


The Chair: Thank you. We will now move on to part four, Open Skies and Business Connectivity. Over

to Mr Wannenburgh. 


Q46. Mr Wannenburgh: Thank you. We have an Open Skies policy for air routes. Given that we

cannot under the policy dictate schedules, what are you doing about securing economic links to the City

of London and the northwest?


The Minister: I think we had Open Skies policies. I think that model suited us several years ago,

but particularly after the seismic shift in aviation over the last two years it is no longer providing

what we need, which is direct accessible flights which suit the visitor and the resident population,

but also the business sector, in terms of getting into the key economic areas that we need to.

What the Department for Enterprise has done is commission a report looking at a long-term

airline strategy; looking at how we can service those sectors; identifying those four key

destinations, which are Liverpool, Manchester, London and Dublin. How we can, if necessary,

intervene in the sector to promote and ensure we have that connectivity going forward.

We have been doing a huge amount of work with existing airlines that serve our Island and

today we announced we have managed to secure flights back into City Airport and into Heathrow.

Later on next week, Aer Lingus will be re-establishing the Dublin links as well, which is a

commercial decision for them and they can see the advantage in doing that. We have also got

increased links to Manchester coming online and the established links to Liverpool. We have got

a range of other airports that are being served and as the aviation industry gets back on its feet,

we will be working with all of those airlines to see how we can provide better connectivity to the

Isle of Man for all the various people who need it. But I think you are quite right, that the Open Skies

policy was very much open, that airlines decided when and how they would arrive on the Isle of Man.

That no longer meets our strategic needs, particularly when it comes to the business sector who may

want to bring people here for the day, or go to one of the key economic targets for the day as well.


Mr Lewin: If I could just add, one of the things the Department led, on working with the

Department of Infrastructure and Treasury, was a piece of work specifically on that question. A

report came back in November. It did identify that, as the Minister said, in the right time and place,

 perhaps, but where we are now – and particularly coming out of COVID – for a small economy,

there are four key routes and they need some form of security. To do that, there are probably a

number of different things you can do from incentives in terms of discounts, or in terms of more

broader incentives, through to then protecting an incumbent on the route and how you can do

that. We have spoken to a number of airlines and we will shortly be going out to the market again

on a longer-term situation.

What has been announced today is very much in the short term. We absolutely heard an

increasingly loud voice to concerns around business connectivity into London, so Government

stepped in and has been facilitating that in the short term. Longer term, we are also going out to

market, and that will happen in the next couple of weeks, looking very much for the long term

around those four key routes and how we can put in place a much clearer, more certain set of

routes that will actually talk to frequency, talk to timing, talk to fares and talk to a long-term

tenure.

Other things, such as international connectivity, also play an important part in that space. We

know it is time to relook at that, work has been under way. We are in the final stages of the short

term, and we are now moving into what we are going to do for the longer term.

Q47. Mr Wannenburgh: That commission that Dr Allinson mentioned just now, is that still to

be released to us or are you still doing that?

The Minister: In terms of the Air Strategy, we will be publishing that, yes. 


Mr Wannenburgh: So when it comes to Open Skies being a thing of the past, you will be

familiar with the term ‘predatory overcapacity’. How are you going to address that, because do

we need easyJet to come in, or not?

The Minister: We have a very good relationship with easyJet. They are definitely part of the

offering for Isle of Man residents and visitors coming to our Island. Absolutely. As Mark has said, what

we will be doing over the summer is putting out expressions of interest to all the airlines, including

easyJet, to look at what their future plans are for the Isle of Man and how those fit in with our strategy. I

have had conversations with easyJet and they are committed to serving the Isle of Man and, in fact,

expanding the number of routes and the number of flights that they provide. I think it is very important

that we have a range of options for people to come to and from our Island.


Q49. Mr Wannenburgh: I agree, but their offer needs to sit alongside other offers, not to the

exclusion of others.

The Minister: Absolutely. That is why we need to look at those levers we have, which are a

range of economic levers to ensure that we have a range of options for people and we do not just

have one airline serving the Isle of Man. We have a real choice for the consumer.

Q50. Mr Wannenburgh: Thank you. The Department of Infrastructure is responsible for the operation

of the Airport – and we understand that – but what are you doing to attract and keep the important

business routes, which I think you have just outlined? Do we give financial support to the likes of

Loganair?

The Minister: Part of the announcement made today in terms of re-establishing, for the next

six months, the flight to City Airport and also new flights to Heathrow, there is some financial

support available which will underwrite that service. That was a decision made to actually re-

establish that service in a short timescale. I think it is very important as we come out of the

pandemic, that if we are going to be serious about having a strategy to get those flights at times

that suit the Isle of Man, there will need to be some initial financial support for that to be taken

forward.

How much of that financial support is utilised is very much up to the Manx public. The flights

are now going to go live next month. It is very much use it or lose it. We have been told there is a

demand for those flights. We want to make sure people use them and this six-month period will

give us the data we need in terms of the actual demand for those.

We have calculated that if we get a 70% to 80% load on the planes it will be at no cost to the

Manx taxpayer. We are talking about a 72-seater plane, so if we get 50 people on each of the

planes it will be at no cost to the taxpayer. But we need to make sure that those flights are used,

we need to make sure that people are aware of those flights. So thank you for the opportunity of

making that statement.

Q51. Mr Wannenburgh: If we ask you back here in six months’ time what will the Department have

achieved in this area?

The Minister: In terms of aviation, what we will have achieved is established far more secure

routes. We will have gained that data in terms of the usage of those routes and their long-term

sustainability. We will have also, hopefully, completed that outreach to airlines in terms of

expressions of interest for developing new routes, and we will have also looked at the various

levers we have to determine what is the best way of attracting long-term connectivity. 


One of your previous questions, I think, was quite right: we need to know what is going to be

available this year and next, not for it to constantly change –


Q52. Mr Wannenburgh: In the end, frequency is more important than price.

The Minister: It is, but prices also … affordability; and access is also important. In the past,

when we have done surveys and you ask people who are using flights just because they want to

go and see relatives or they want to go on holiday, often they do not necessarily mind when they

fly as long as the price is right.

If you perhaps asked the business sector, they are quite happy paying a premium because it

saves them a hotel bill for staying overnight and getting the flight back the next day. So, again,

I think we need that choice and hopefully we can achieve that by having a range of airlines

servicing the Isle of Man.


Mr Wannenburgh: Thank you.

Q53. The Chair: I just wanted to pick up on Mr Wannenburgh’s … You mentioned a full air

service review in your statement today and you have mentioned an Air Strategy. I am assuming

they are the same item, would you say?

The Minister: Yes.

Mr Lewin: We have a report that has told us what we think are the areas we could improve on.

It has identified that in terms of a small economy, for four key routes, we need to do something

different. We are about to go to market, very much hand in hand with the Department for

Enterprise’s support and the Department of Infrastructure in that space, and we will be open to

all airlines to come back. As I said before, in terms of four different aspects you could use to secure

that longer term, I think the strategy is relatively clear in the context of we want frequency, we

want timing, we want the long-term sustainability. We talked about not over-supplying a

particular market. Those kinds of protections are what we are looking for.

So that is very much the next step for us in terms of going to the market, still with advice for

some expert opinion, to actually land a new set of agreements in place on those routes, going

forward for a number of years.


The Minister: If I could just answer, the review is the first part of a far longer long-term

strategy.

Q54. The Chair: Okay, thank you. So your full air service review which, as I said, you mentioned in

your statement: when do you expect that to be complete; and will you be bringing that to Tynwald?


The Minister: The review is complete and was presented to the Council of Ministers in

November. The actual strategy itself, that I have evidenced, we will be publishing in the very near

future.

Q55. The Chair: Any ideas on that, Minister?


The Minister:
Probably within the next week or two.


Q56. The Chair: You gave some detail there just before about the cost to the taxpayer, and

I appreciate that. You said if 50 people or more were on the plane, it would not cost. So what 

would it cost per person, less? So if there were 49, and that one person … What cost is that to the

taxpayer?


The Minister: I am quite happy to share that information with you confidentially, but again this

is quite detailed financial information regarding a particular carrier, so I would prefer to do that

confidentially. I cannot give you the exact answer per passenger, but we do have that information

based on the overall load of the aircraft.


Q57. The Chair: The current plan, the press release that you released today, it is just another

example of the Open Skies, because it is volatile to market conditions. That is what it seems. Is

there another model that you would offer, that could offer more certainty and dependability?


The Minister: What we have announced today is a six-month programme of times that we

asked for, which particularly responded to the need of the business community to have

connectivity to the centre of London, so that they could arrive early in the morning, leave early

evening and basically have a day trip to London if they needed to visit clients, or clients needed to

come here. This is the first step, as Mark has said, in reaching out to the aviation industry in terms

of what our needs and requirements are.


There are obviously routes that we want to develop, but we need to also develop the actual

timings of those routes and the price of those routes so that they are affordable to all the people

who want to fly to and from our Island. We will be developing that as part of this long-term

strategy and we will be trying to secure that as well, so that it does not change at the whim of a

particular airline and so that we have the choice for the consumer.

Again, the Open Skies policy was very much that anyone could fly here if they wanted to and

they could fly at any particular time that suited them. What we are trying to do as we emerge

from the pandemic, driving economic growth, is to actually provide that accessibility and that

resilience to a service.


Mr Lewin: If I can add to that, without pre-empting what will come forward in the strategy,

particularly on your key economic routes of Liverpool, Manchester, London, Dublin … putting in

something around that, which deters over-supply. That is absolutely one of the key things we want

to achieve. I said there are four things: it can be as simple as having a high default rate and only

providing incentives to those that meet the demand; through to some form of incentives, which

we have done from time to time to stimulate demand, to the point where it is viable; through to

having a commercial agreement, which is what we have entered into for six months; through

to – and it is not off the table – having a licence. If that is where we get to, and if that is what the

feedback is, and if that is genuinely what is going to serve us well …


We have spoken to the incumbents that fly currently to the Isle of Man and told them a licence

may be one of the things we will look at as part of this process. But, absolutely, at a top level we

want to get away from not knowing almost from month to month or from year to year what is

going to be on the route; and also being subjected to somebody else coming and disrupting that.

That is essentially what the report says. That is what our overall aim is. We are having to take

a short-term position, but longer term we have got a range of tools to try and achieve those

outcomes.

Q58. Mr Moorhouse: Today, we actually got the results, the outcome of the process. In terms

of the process, you have given the suggestion that you were very proactive in terms of specifying

what you wanted. Did those requirements go out to all the airlines, or was it just down to a small

group who you chose to work with?

The Minister: We worked with the current airlines that are supplying the Isle of Man. We also

reached out to other airlines as well to see if they were interested in flying to the Isle of Man. But 

at the moment, because of the nature of the aviation industry, there are not a lot of players in

there who are opening up new routes to new destinations.


Mr Lewin
: Going forward, though, what we are going to go out with longer term will go to

every carrier, existing and potential, in terms of a longer-term set of arrangements.


The Chair: Thank you, gentlemen. Just to say, it is actually quite hot in here, if you want to remove

your jackets, if you want to take a moment? I certainly do not mind. We will move on to part five,

Motorsport Event Delivery. Mr Wannenburgh, if you would like to …?


Q59. Mr Wannenburgh: Last month, the Chief Secretary appeared before this Committee and

we understand he chairs the Motorsport Event co-ordination. Does your Department expect any

challenges within this year’s TT event?


The Minister: Yes. TT is always a challenge, and bringing back TT to the Isle of Man after a twoyear

hiatus is probably even a bigger challenge. I am afraid I did not listen to the evidence the Chief

Secretary gave you. Some of it is very simple: the number of police officers who have never

policed the TT and who are new to their role, and now need to be told what to expect. Obviously

the other main challenge that we were concerned about was getting the riders and their teams

back. I am glad to say that we have had almost record numbers of entries for the TT, so they are

keen to get racing on our roads again.

As you are probably aware, the DoI has closed the Mountain Road for a period of time while

they do the necessary repairs to it, and that is on track. I suppose one of the other challenges that

has got publicity is in terms of the marshalling of the TT. We rely upon a large number of

volunteers and enthusiasts to allow the event to run. Marshals have not had any role for the last

two years, so it is absolutely right that we get on with the retraining here and we get on with

getting marshals to come forward, whether they are on the Island or off the Island; and if they

have marshalled before, invite them back to the event. But also that we talk to people on our

Island, particularly young people, to get them involved in the event as well, so we have that

sustainability.

Over the last two years the Motorsport team, the organisers of the TT, have done a huge

amount of work, particularly in terms of safety and looking again at all the various ways that the TT

is run. So I am confident that we will get road racing back on the Island for TT and Manx Grand

Prix, but we will do it on a much more sustainable level than we have ever done before.

Q60. Mr Wannenburgh: You touched on marshals, do you think we will have enough marshals

to run the event?


The Minister: Again, yes is my own personal feeling, but I do not take marshals for granted.

I do not take the volunteers for granted. We have to appeal to them, and I would like to take this

opportunity to appeal to them. The TT is based on the people of this Island and our visitors

marshalling, being trackside, being part of the event. That is one of the things that makes it unique.

Please, if you have marshalled before, think about marshalling again if you have been resting for

the past two years. If you have never marshalled before, the Marshals’ Association will be

announcing on-Island training. Please take part in this, it is a fantastic event and you will be an

intrinsic part of bringing it back to the Island.

Q61. Mr Wannenburgh: Are you confident that the availability of bed spaces will be enough?


The Minister: Again, there have been various things in the press, particularly in terms of the

Homestay scheme and it will be a challenge. One of the things with Homestay is often people go

off Island and rent their home out while they are away. There has been a lot of anxiety – even

over the last month – about whether the TT will happen. It will. But, particularly with issues going on in

Europe at the moment, will people from the Isle of Man be wanting to go abroad and let out their

homes? I think that will be a challenge. However, we have some incredible campsites here. We have a

diverse hospitality offering not just hotels, homestays and B&Bs, but campsites and glamping.

Hopefully, people who want to come over here will find a place for them to stay. Our role in terms of

the Department for Enterprise and the Visit Agency is to try to promote that as much as possible, and

try to advertise that as much as possible so that people know the choice that they have got once they get here.


Mr Lewin: If I could just add, I think we recognise again that the absence does introduce more

risk, and we have been going through … As the Minister said, the two years have been a real

opportunity to go back and fundamentally look at what the strategy needs to be for the TT. Probably the

biggest body of work that has ever been done around this space. Currently in terms of the Marshals’

Association, they have record numbers of people signing on for training compared to what we would

expect. There is a whole new training package as well, because we are lifting standards. So this year,

yes, there are additional challenges that we need to face, but if you look at what we are trying to bring

for fans, there are new things from the Fan Park to the global broadcast. There are new things in terms

of the riders and the teams. There are new things in terms of safety standards, we have electronic flags

that we have not had before, and improved communications and CCTV, and a whole range of things in

there.

But absolutely it comes back to making sure that the people of the Isle of Man … It is done with

their support as well and we need to make sure of that. We have talked about schedule changes –

and we have talked about schedule changes for next year to improve it as well. Homestay is

another part of that and we understand that a number of people who have previously been

involved have come forward. In fact, two years ago, we had a record number of people who had

come forward, and then obviously the event was cancelled, and there was uncertainty. Some of

the reason that people perhaps have not come forward is just, as the Minister said, that

uncertainty. We will continue to work, we will continue to sign people on. Both from a marshalling

perspective and from a Homestay perspective, all the indicators are that there is a strong demand

across all the different aspects in terms of bringing back a really strong event.


The Minister: There is also a huge amount of loyalty. One of the problems for hotels and

homestays is those people who were meant to visit here from 2020 have rolled over their

bookings for two years. They are so dedicated to the TT that they want to come back. They believe

in it. The TT Marshals’ Association are on course to train three times more marshals than ever

before, in time for this event. So I think that, whilst there are challenges to getting it back on track,

there is a huge amount of optimism there that we can build back.

We can get the TT back, it will happen. Then we can grow that, as we intended to do before,

through use of things like the live streaming and actually opening out to a brand new audience.


Q62. Mr Wannenburgh: Are you able to tell us how much you spend on promoting the TT?


Mr Lewin: In its broader context, it is in the Pink Book. It depends what you mean by

promotion, but broadly the Department spends around – this year’s budget is going to be around

£9 million net, because it also brings in income directly to the Department. It will spend about

£6 million. But then the economy generates and when we have previously had studies around 

this, then the exchequer benefit exceeds that. So that is the model, but it is absolutely in the Pink

Book in terms of what the budgets are for next year.

Q63. The Clerk: Sorry, can you explain the net and the six and the nine a bit more slowly? You

said the net expenditure was ‘nine’ but the income was ‘six’.

Mr Lewin: Yes, I should clarify that is not necessarily the TT. That is the whole Motorsport Event

programme which includes the Grand Prix as well. But we invest, we spend things – from the

organisers, to safety, to equipment, to appearance fees, prize winnings, logistics and infrastructure. But

there is direct income, whether it is from ticket sales, hospitality, programme sales or from the TV

programmes – 


Q64. The Clerk: So the expenditure is greater than the income?

Mr Lewin: The expenditure is greater than the income directly to the Department, but at an

economic level in terms of visitor spend and exchequer benefit, then that exceeds what is spent.

That is, principally, we go back to as you said before, the Chief Secretary, the national

Motorsport Committee that he chairs is to make sure that all areas of Government come together

to make sure the event happens. But it is not done for any other reason than to generate economic

benefit for the Island.

It is an Isle of Man event. If we wanted to raise money there would be other ways to do that.

It is absolutely part of our tourism proposition to bring people here for the event, but also then

all year round as well. The number of people who come here to visit because of the events … But

outside that period, people who come to live here, often you will hear that they have come for

the TT, or they have heard of the TT. The Isle of Man is a fantastic brand for us. It is a fantastic

tool.

So, yes, it is a net spend. It is a significant amount of spend from a Department perspective out

of our budget, but the whole economy benefits in terms of that.


The Minister: In terms of the economic impact of the TT, there have been two reports written

trying to quantify that. But what they also showed was that, because of the TT, people will invest

in premises, invest in hospitality, and invest in restaurants and shops for the TT – which residents

and visitors on the Isle of Man can then use for the whole 12 months round.


It is a huge economic stimulus and actually losing it for two years, during the pandemic, showed

some of the issues there that perhaps certain businesses are too reliant on the TT. So that is why,

with our visitor strategy, we are looking to extend the visitor season to look at those shoulder

periods, to extend the amount of time that people are coming to the Island, and to try to expand

the availability for people to do business on the Island without having to rely solely on one or two

events.


Q65. The Chair: Thank you. I am going to now move on to another section, which I had not advised

you we were going to go over, but just to talk a little bit more about the film industry, if you would not

mind?

A couple of days ago, there was a BBC report that Liverpool’s film and TV industry is said to be

booming – films like the Batman programmes, including Doctor Who and Responder, brought in

£18.7 million of investment in the city in 2021; £400,000 of which generated an income to

Liverpool City Council for paid services like location fees. Is the Isle of Man, in your eyes, missing an

opportunity here to build a booming industry of our own? Surely this is worth greater time and

investment.


The Minister: Thank you, Chair. It is certainly worth reconsidering because what we have seen over

the past couple of years is a shift in media in general. Rather than big film studios, the use of streaming

has created a far greater demand for content and so we have seen mini-series being filmed all over the

world. We have seen large productions such as a Batman movie, but also an awful lot more TV

productions for some of the big streaming services. So that is certainly something in terms of economic

development that we need to be aware of.

As you know, the Isle of Man in the past has invested in the film industry in terms of both

logistical support and underwriting the productions themselves. With a change in the past

taxation regimes, that was deemed no longer to be fit for purpose, and there was a recent PAC

inquiry into that and into the circumstances around that. What the Department does is offer a

range of options for people who want to film here in terms of logistical support and advice to try

to make it as easy as possible.

In terms of locations, unfortunately, for residents, we can close roads at relatively short notice

and allow people to set up filming projects. We can actually facilitate their accommodation. We

can put them in touch with people locally who can provide those services. What we have not done

is invest large amounts of taxpayers’ money in productions. There is a range of financial support

for media companies and, for instance, for animation studios, but we normally ask for them to be

based on the Island and contribute in terms of jobs and the local economy, rather than just fly in

and do some filming and then fly out again. However, as that sector develops, we will be looking

into it. One of the aspects in the United Kingdom is obviously the availability of studio space and

the availability of skilled workers, and the Isle of Man lacks both of those. So there would be a

significant investment if we are going to compete with Pinewood.

Again, in the past there have been Government policies to do just that. I do not know whether

that is something we would need to go back to, but through the Digital Agency we are in touch

with a range of people in the media sector and obviously responding to their ideas and any future

developments that might come forward. I do not know whether you want to say anything?


Mr Lewin: What are the real challenges we face? As the Minister said, we can do things like

financial support at a low level when somebody comes to do something on the Island that has

economic value for us. Around the world, many jurisdictions provide these tax credits back, so

whether they are filming in the UK or they are filming in Ireland the production company is getting

direct cash to do that. Obviously because of our economy, where we do not bring tax in at that

 direct level, we do not provide the tax credits back out. There are other challenges which we can

absolutely work on, but the fundamental reason why people …

We would still get lots of enquiries, but they are always looking for substantial upfront cash,

and that is just, politically, a space that we have not been in. The case is more challenging to say

that you get that directly back – it comes indirectly in terms of PR and brand awareness. But,

directly, that is a hard space for us to get back into. The Digital Agency has previously looked – we

had a media agency which we provided support to – but we are all struggling against that hard

challenge of the tax credits to find what is the proposition that would bring somebody here to do

the production.

Sometimes people will come here for an element of it, and we absolutely will support and we

do support that, but not investing in the way we used to.

Q66. The Chair: You obviously just mentioned about the tax credit scheme funding to support

productions, and because we do not have this we are going to continue to lose out on productions

being filmed on the Island. It is a fact. So why does the Department feel that this is an area the

Government should not be investing in, when it is so lucrative in the UK?

The Minister: Again, in the UK, they obviously have a different tax structure, and so they have

the facility to give tax credits on corporation tax that will be paid. We do not have corporation tax. 

It is certainly something that we have asked KPMG to look at in terms of the wider economic

strategy, whether this would be something that the Isle of Man Government should go into again

in the future. We will be waiting for that phase of the report to come forward in terms of whether

that is a lever to go forward.

But again this is taxpayers’ money. There is quite a large amount spent in other jurisdictions,

particularly the UK, to promote media development. It has been quite successful, but it has been

at a considerable cost.

Q67. The Chair: Pertinent to your Answer to a Question to a Member of the House of Keys on

1st March, you intimated the Department were focusing on business that will establish a

permanent presence. Would you not agree with me that an industry, such as the film and TV

industry, is not actually a one-off and that Liverpool – who reported 250 productions a year

in 2021 – is very much not a one-off industry?


The Minister: Yes, but what I was talking about was having a physical presence on the Island.

So with the tax credit system in the UK, it constricts people’s ability to have pre- or post production in

other jurisdictions. There is an element of that.

Most of the financial support that we give on  behalf of the Isle of Man taxpayers is growing the

local economy by having people based on the Island, having a physical presence on the Island.

A lot of the various companies that have been set up, are set up just to produce one film or one

mini-series and then vanish. They are dissolved. That would not, in my opinion, give us the

sustainable job prospects that most of our schemes are designed to deliver. However, as I have said, it is

something we will be looking into as part of the overall economic review.


Q68. The Chair: Do you agree with me that jobs in this sector would attract youth to return to

the Island, if this was a booming economy like it would be in Liverpool? So you would have

everything including directing, lighting, research, hair and make-up, wardrobe, stylists, animation,

production designers, sound engineers, special effects, technicians and writers – let alone the

effect it has on the economy for hotels and hospitality.


The Minister: I think we do have some very good writers on the Island who use this as their

base. Most of the other skills you have been talking about will travel the world, depending on

where the occupation is. The Department of Education, Sport and Culture finance people to do

media studies to get just those skills that you have said, and they will travel the world for work,

whether that be filming on the Isle of Man – which we will still always encourage – or filming in

Hong Kong or Europe.

Again, what you are talking about is setting up the Isle of Man as a centre for film production,

which has been done in the past. It involves quite a significant capital investment from the Isle of

Man Government and in the past the returns have been very variable. It is a very difficult business

to get into. However, as I have said, this will be one of the parts in terms of the economic review

and if it is seen to be a prospective sector that we should be considering further, we will do that.


Q69. The Chair: This is ironic because we have just come from one subject to the other. We

have gone from the TT where you are spending £9 million on the budget and £6 million net

income, but yet you are not willing to do that in another industry. Is there is a reason for that? Who

makes that decision?

Mr Lewin: Ultimately, the Public Accounts Committee looked at the film industry generally and

looked at the investments that have gone in that space. But going back, we can evidence that the

economic value of having the motorsport events outweighs the investment. In fact, everything the

Department for Enterprise does generates economic value into the economy. We do look at it. Our

financial assistance schemes and our Enterprise Annual Report which is coming before Tynwald, talk

about the return on investment. So when we are spending taxpayers’ money on something we have to

see the broader benefit in the economy. It might not be in one year, but you would certainly hope it

would be well within five years.

Film, when they are often looking for millions of pounds of investment and you see it over a

relatively short period, the business case in just that one … As the Minister has said, they are often

single entities and you do not get the return … You get a return, absolutely, but nowhere near the

amount that you would need to put in as a jurisdiction. It is a significant business case that, when

it has been looked at before, does not stack up for us as a small jurisdiction. It can be looked at again

and maybe it will feature in the Economic Strategy coming forward as one of things that could be

looked at, but every time it has been looked at in the past a business case just does not stack up.



Q70. The Chair: The economic benefit of the TT that happens once a year … I am not saying

that it should not happen, but it happens once a year. It is as unstable as the film industry, surely?

You could have several films or several TV productions being filmed on the Island that actually

would, to me and many people, bring quite a large economic benefit. Especially if you built it up

over a certain number of years.


The Minister: Again, Chair, I am not saying no. If people want to film on the Island and want to

bring the production to the Island, we will do whatever possible to facilitate that. The TT has been

going on for over a hundred years. It is a major part of the culture of the Isle of Man. Filming has been

going on for years on the Isle of Man and often is a very good advert for 1480 what we have here and

the beautiful scenery we have here. So we are not saying no. What we are questioning is the financial

return on large-scale investment of taxpayers’ money into various productions. That has been looked at

in the past and not seen to be a good use of taxpayers’ money.


Q71. The Chair: Okay. It was brought up on 1st March by another Member, that the accounts

show at the end of the life of the Isle of Man Government audited accounts in Isle of Man Film Ltd,

that there was £635,000 available inside those companies. Can you advise what happened to that

money? Or, where did it go to?


The Minister: That was a bit before my time, I am afraid.

Mr Lewin: I can certainly follow offline if that helps in terms of showing where they went to.

All the companies across Government are ultimately owned as part of Treasury, in terms of the

shareholder. There was a proposal where some of those funds were being made available for

small-scale media companies that needed to do certain things. We drafted a scheme around

helping, for example, a scriptwriter to take something to the next stage of a pilot, working

together with the Arts Council.

I will come back offline in terms of whether that has been used and to what extent. But that

certainly was one of the ideas of where some of those funds would be repurposed. But all of the

1entities, when the cash is there, it is still the public cash, and ultimately it goes all the way back to

Treasury.

The Minister: One of my disappointments, when I took up the role as Minister for Enterprise,

was to see that the Department had zero budget. We very much spend what we can earn. We do

get various grants, we work closely with Treasury in terms of financial assistance when that is

above and beyond that income. But we are one of the few parts of Government that tries to 

finance itself. That has advantages in terms of governance and advantages in terms of prudence,

but also sometimes disadvantages in terms of our ability to fund large schemes. However, we act as a

conduit for taking those schemes to Treasury for further financing.


Q72. The Chair: Thank you. We are now just going to move on to another section, which has been

brought up recently in the House of Keys. With the recent reports of Manx residents’ ability to access

credit cards, what more could the Department be doing to overcome these barriers?


The Minister: Thank you for the question, Chair. It has become public knowledge that there has been a

change in the appetite from various providers who previously provided credit cards to Isle of Man

residents, that they are no longer willing to do so. This seems to have been due to an element of ring-

fencing after the 2008 financial 1520 crash coming to fruition, and also then re-evaluating their risk

appetite.

What the Isle of Man Government have been doing is talking to the entire banking sector to

see what those problems are, to see if we can reassure them through work with the FSA, if they

do question the risk environment. We have worked with those banks that are still providing credit

card facilities to Island residents. We are also writing to all credit card providers to see if they

would be willing to expand to the Isle of Man; and also working with the Isle of Man Post Office

who have a limited banking licence to see if they could also provide a service to Isle of Man

residents.

By working closely with Tesco Bank, which got the headlines, we have managed to extend their

provision for the next six months, which at least buys people the time to look into other

alternatives. But it is something that is increasingly important. The Access for Cash report shows

that more and more people are using credit cards and online banking to pay for a whole range of

services, and we need to make sure that Isle of Man residents are not disadvantaged, whether

they are here or abroad, by lack of access to these services.

Q73. The Chair: It is absolutely essential, obviously, if we are trying to attract people on a global

standard. We have got to be able to have the credit facilities here on the Isle of Man.

The Minister: Absolutely, and it is part of a wider issue in terms of banking services on the

Island for people relocating here or setting up a business here, that we try to work quite closely

with the finance sector through the Finance Agency to provide.

The Chair: Which brings me nicely on to my next question. Residents or people moving

here are continually facing delays when opening up new bank accounts, it can take six to 10 weeks.

Is there anything being done by the Department to establish why that is taking so long? And what

can be done about that?

The Minister: There are a range of issues regarding that. Sometimes it is due to the banks

themselves and their own procedures. Sometimes you need to have proof of identity, which

includes a utilities bill, where you may not get your utilities bill straight away. So we have been

working with the banking sector in terms of KYC, to look at alternatives, so that people can register

their ability to prove that they are an Island resident and register their ability to prove their

identity in a much easier way than having to wait for conventional means.

Q75. The Chair: Is that something that including biometrics could be utilised …? Is the Digital

area looking into that?


The Minister: There are a range of digital options, you are quite right. Part of the legislation

that we are going to be bringing through looks at how you can use digital alternatives to the

standard paper-based application forms that are currently necessary.

Mr Lewin: It has been a regular topic over the years directly with the banks, and the broader

economy – putting it to the trust providers, speaking to the banks directly, or businesses speaking

at a business level – the ability to open an account and the risk appetites. Ultimately, these are

commercial entities and they have decisions made in terms of what they have an appetite for, or

not. But on a personal perspective in terms of individuals here being able to open bank accounts,

it is something we have talked to them about; and we continue to talk, as you said before, on

credit cards.

The broader range of services you would expect and you need to have in an economy for it to

be healthy, ordinarily Government would not step in. We have to be careful. For a small Island,

we have a real variety in lots of areas, but there are times where that choice narrows down and

we have to do something to understand it and perhaps step back and make sure there are choices

available. We have done it on air and we are watching in this space and continuing that dialogue

in terms of credit facilities in particular.


The Chair: Thank you. Mr Moorhouse, would you like to ask a question?


Q76. Mr Moorhouse: Just in terms of medical cannabis, we recently spoke to the Gambling

Supervision Commission and they are clearly involved in the regulation, but it was quite clear from

that conversation that there is a lot to be done by the Department in areas like planning and

marketing and everything else. How is that actually being managed?

The Minister: In terms of planning and marketing, again our role is very much enabling the

sector to develop. The Gambling Supervision Commission is an independent regulator. We work quite

closely with them in terms of introducing people to them, in terms of marketing the availability of that

sector on the Isle of Man, and recently held various workshops and functions to introduce people in that

sector to the Gambling Supervision Commission. We have been doing some work also,

internationally, in terms of raising the profile of the Isle of Man as somewhere that … you can be

based, in terms of cultivation for export.


Q77. Mr Moorhouse: Given this is a brand new area, what role has the Home Office played in

allowing us to move forward? Has it been limiting in any respect, or has it been incredibly

supportive?

The Minister: The UK Home Office is obviously not part of our legislation. We are an

independent jurisdiction. However, I understand that the Gambling Supervision Commission has

asked for their expertise and advice.


The Chair
: Thank you. Mr Wannenburgh.


Q78. Mr Wannenburgh: TT Zero: how does that sit with our green agenda …?


The Minister: The TT Zero will not be happening this year and there are a range of reasons for

that. One of them was that in bringing road racing back to the Isle of Man, we wanted to make

sure we had a sustainable schedule. As you are probably aware, the number of entrants for

TT Zero was dropping off year on year. Some of the university teams that were normally taking

part would be very unlikely to be taking part this year. So we will not be running it this year. 


What we are doing, though, is looking at other ways that we can introduce more of a green

agenda to the TT, whether that is using biofuels for the existing bikes or whether that is

introducing other racing. There are various manufacturers who have been planning to produce

production bikes that use electric power or even hydrogen power. If we can harness those we can

race them.

But in 2019, for the first year, we offset the whole of the carbon emissions for the TT and we

will be doing that again this year.


Q79. The Chair: I have a final question for you. You spoke earlier about hopefully bringing

employment law reform through. Are you looking at doing that in this administration?


The Minister: Yes.


Q80. The Chair: You are. And at what point is this going to be coming about?


The Minister: What we are doing from a Department point of view is trying to look at – for

want of a better word – a ‘quick-fix’ that we can do; for instance, reforming parental leave that

takes some relatively small legislative changes which can be done relatively effectively.

There is a three-year programme to look at the entirety of employment law on the Isle of Man

on the back of the Zero Hours Report that was given to Tynwald, on the back of the Taylor Report

that took place in the United Kingdom, to look at better ways of establishing employment rights

both for employers and employees. That will be put out for consultation, hopefully over the next

year or so. It is a large piece of work to bring our legislation not just up to date with that in the

UK, but actually to make it world class. Because, again, if we are going to attract people to stay

here or to come and live here it is essential that people know what employment rights they will

get, whether that is maternity or paternity pay, whether that is leave in terms of bereavement,

but also their employment rights in general. So, to make absolutely certain we get that right.


Q81. The Chair: Will you be looking at menopause in the workplace as well?


The Minister: Yes.


Q82. The Chair: Good. Fantastic!

That brings us to the end of our prepared questions, but before we close is there anything else

that you would like to say?

The Minister: I would just like to thank you for your time today. As I said, it can be quite difficult

to describe the intricate workings of the Department for Enterprise, and if I have forgotten any

parts of it I apologise to the staff who work there, because it is an incredible bunch of people who

reach out to all sorts of parts of our community. But, as we have demonstrated, we have gone

from filming to TT, to start-up companies to childcare. It is a really diverse Department.

It is a pleasure and an honour to be the Minister and I hope to see you in a year’s time, so we

can give you an update on some of the subjects we have been talking about today.


Q83. The Chair: Thank you very much. Mr Lewin, any other points?


Mr Lewin: I would just echo that, thank you very much. We will be bringing the Department

plan forward to Tynwald in May, and we will further explore and give you some indication of the

priorities we see over the next number of months.

But as I said at the outset, a lot of what we do is actually driven by what industry is saying, in

terms of where the ideas are. We have a fantastic staff and the Minister has said it all. But I really 

look forward to following on with some of the things we said we would share and we will do that

straight after this.

The Chair: Thank you very much for attending. The Committee will now sit in private.

Thank you.

The Committee sat in private at 4.38 p.m.