Press Release
GOVERNOR'S ANNUAL ADDRESS TO LEGISLATIVE COUNCIL
24 May 2007
Mr Speaker,
1. This year we mark the 25th anniversary of the liberation of the Falkland Islands from Argentine invasion. It is a time to commemorate those who died in the conflict, in a respectful and dignified way. It will allow us to remember the courage and professionalism of all those in the British Armed Forces and civilian support services - and Falkland Islanders - who helped to secure the freedom of these Islands. We shall recall with appreciation the political will of the Prime Minister of the day, then the Rt Hon Margaret Thatcher MP, in taking the difficult decision to send a task force to return these Islands to democracy in the face of unprovoked aggression.
2. It will also be an opportunity to showcase the Falkland Islands as they are today - a modern, thriving society, self-sufficient in all matters except the cost of defence. Those veterans who return here will see how much the Falklands have changed. The population has grown by 31%; we have a sustainable economy, good quality public services, a vibrant private sector and modern arrangements for governance and democracy. Islanders can be forgiven for the occasional smile of self-congratulation. Whilst our current economic success is built upon our fisheries' natural resource, it owes much to the hard work and initiative of the Islanders themselves and to the careful management of the Islands' economy by successive Falkland Island Governments (and the civil servants concerned). Revenues have been put to good use in the development of education and health services, roads and communications and much more. And the Islanders have retained the essential characteristics of their forebears, hard-working, persevering, and self-reliant.
3. The conflict, paradoxically, proved to be a turning point in stimulating the development of this society. It is our privilege therefore to turn in gratitude to those British veterans who return to the Islands to say thank you, and to hope that they will feel that the effort and sacrifice on their part was worthwhile. Certainly, many of the media commentaries this year have remarked on the advances made since 1982. The evidence is all around us. Islanders have a right to be proud of what they have achieved and are still achieving.
4. In June, we shall host a large group of distinguished visitors from the UK - His Royal Highness the Prince Edward, Earl of Wessex, as representative of Her Majesty The Queen; the Rt Hon Adam Ingram MP, Minister for the Armed Forces, as representative of Her Majesty's Government; Dr Liam Fox MP, Shadow Defence Secretary, as representative of Her Majesty's loyal opposition; Sir Nicholas Winterton MP, Chairman of the All Party Committee on the Falklands; Lord Parkinson, as representative of Baroness Thatcher's Cabinet in 1982; Bishop Stephen Venner, Bishop for the Falklands; the Vice Chief of the Defence Staff - and of course Sir Rex and Lady Hunt.
5. We shall also be host in June to British veterans, invited here by the Falkland Islands Government to participate in the 25th anniversary commemorations, together with representatives from Ascension Island, St Helena, the States of Jersey and the Cayman Islands, who did so much to support our cause during the Conflict. We should give them, and the veterans who follow in November, a great welcome as Islanders have always done. I am conscious, Mr Speaker, of the great deal of hard work that you and many others are devoting to making these events a success, which all Islanders can enjoy and in which the community can take part.
6. The presence of these senior representatives, along with the ceremonies that will be held in London and elsewhere in the UK, demonstrate clearly the depth and closeness of the link between Britain and the Falkland Islands; the continued commitment of the British Government to the Falklands; and the importance that the British people attach to the principle of self determination. Successive British Prime Ministers have consistently made it clear that the UK Government has no doubt about British sovereignty over the Falkland Islands, and that there can be no change in that sovereignty or discussion of sovereignty unless and until the Islanders agree - and currently I see no indication that Islanders wish any such change.
7. But both the British and Falkland Islands Governments seek to maintain good working relations with Argentina. We have previously been able to co-operate well on various matters of common interest, such as the conservation of shared fish stocks, by putting to one side the issue of sovereignty (under the sovereignty umbrella). Unfortunately, the approach of the current Government of Argentina seems to be to narrow seriously these areas of co-operation. The Argentine Government have made it clear publicly that what they want is discussion about the transfer of sovereignty to Argentina - and on that there can be no meeting of minds.
8. The Argentine Government has recently taken action to put pressure on the Islanders and on businesses that have contributed to economic growth here. In March, Argentina withdrew from the 1995 Joint Declaration on Hydrocarbons and announced a ban on oil companies working in Argentina from also operating under a FIG licence on the Falklands continental shelf, with retrospective penalties. In April, the Argentine Chamber of Deputies passed draft fisheries legislation designed to penalise fishing companies in much the same way: the legislation is now before the Argentine Senate. Argentina has also stalled co-operation in the South Atlantic Fisheries Commission, and continues to block any progress on the establishment of a multilateral high seas fisheries agreement, which works against their own fisheries conservation interests as well as ours.
9. Such measures do not improve the scope for understanding between the people of the Falkland Islands and Argentina. They are certainly in marked contrast to the efforts of the UK and Falkland Island Governments to be constructive towards Argentina.
10. I hope that the invitation to the Argentine Families' Commission to bring next-of-kin and relatives of those Argentine servicemen killed in 1982 to a commemorative service at the Argentine cemetery in Darwin in November this year will begin the process of healing. Whatever the relationship with Argentina at a political level, Islanders have always welcomed and assisted visits by Argentine next of kin. But memories of the Argentine invasion and occupation are still very stark here. The Argentine Government, whilst it may be democratic and has eschewed pursuing its claim by military means and disowned the actions of the military junta, cannot ignore the fact that the invasion occurred and that it changed the situation completely for Islanders and Her Majesty's Government alike. It will be important, therefore, in agreeing with the Argentine Families' Commission the arrangements for this group visit, that Islander sensitivities are respected. This has not been helped by the inappropriate actions of the Argentine veterans who visited the cemetery recently. They did not receive widespread support in Argentina for what they did and Councillors were able to put across their views about the incident in the Argentine media. Most Argentine visitors act sensitively and sensibly. So we should not overreact but be prepared to receive the Argentine visiting group with our usual hospitality and courtesy.
Mr Speaker,
11. About three years ago, the Government published its second Islands Plan. The Plan sets out a series of aspirations linked to the Government's Mission "to protect and improve the quality of life of Falkland Islands people and community." Today, I shall break the practice of reporting on the activities of Government departments over the last twelve months in favour of highlighting some of the achievements against Government's objectives in the Islands Plan.
12. The first chapter in the Plan is on self-determination. Islanders have an opportunity now to look again at the constitutional arrangements for their government. In 1999, the UK Government invited Overseas Territories to examine their constitutions to identify whether any changes were required to reflect current circumstances. Since then, elected Members have undertaken a review of the 1985 Falkland Islands Constitution and, following extensive public consultation, the final report of the Select Committee has now been published.
13. It is for Councillors rather than me to explain their proposals but I think it wholly proper that any new Constitution should seek to advance internal self-government and clarify the role of the Governor. I am a firm believer in Councillors having more responsibility and being accountable for their decision-making - and, in my time here, I have made it clear that on most issues affecting domestic policy, it is a matter for Councillors not the Governor to decide. I recognise Councillors' concern that such matters should not be left to the whim of individual Governors - that will be for the drafters of any new Constitution to resolve.
14. I have forwarded the Councillors' report to London. This will trigger discussions, initially at official level, which should lead to an agreed new draft Constitution. I should make it clear that London may not necessarily accept all the proposals. The UK Government will wish to ensure that key democratic principles are upheld - on human rights, the independence of the judiciary, the impartiality of the administration of justice including the police, and protecting the freedom of the civil service to give advice without fear of penalty or improper interference. London will also look closely at any proposal which restricts the overriding power of the UK Government to intervene, if necessary, when things go wrong or when the principles of good governance are compromised. Whatever the case, there will be full public consultation and transparency on any new Constitution.
15. There will be some complex issues to resolve, not least the issue of status and citizenship, which affects the fundamental principles of democracy, such as the right to vote and to stand for election. Many outsiders find it difficult to understand the nature of the Falkland Islands' link with Britain - British yes and with a right to British citizenship but not part of the UK and with no automatic rights for British visitors to settle here - and with a separate Government largely responsible for domestic affairs, with control over immigration. What some do not acknowledge is that many islander families have been here for generations - and that it is right of the Falkland Islands community to decide how the Islands should develop and who should live here.
16. It is as well, however, to nurture the relationship with Britain. Raising awareness of the Falkland Islands in the United Kingdom, and indeed elsewhere, is a primary function of the Falkland Islands Government Office in London, which maintains a remarkable range of contacts. FIGO does wonderfully well in securing the support and understanding of Parliamentarians and key opinion-formers to the unusual circumstances that Falkland Islanders face and in dispelling some of the myths about life in these Islands. In this regard, the Falklands Forum, held in Westminster on 18 April, was an outstanding success. I should like to acknowledge the generous sponsorship of the local business community in supporting the Forum.
Mr Speaker,
17. It is a primary responsibility of Government to promote sustainable growth in the economy. We are doing well. The latest figures available show that our gross domestic product now exceeds £75 million per annum. Back in 1982, Lord Shackleton reported GDP in 1980 to be £4.4 million. Public expenditure was correspondingly lower at £2.48 million but now stands at £41.8 million. The main contributor to our economic success is the fishing industry. Some claim that they have received no benefit from the income which the fishing industry generates. That is, of course, nonsense. 40% of Government income is generated by the fishing industry and the industry represents 44% of our gross domestic product. Government spending, and therefore the services that we enjoy, depend upon the contribution that the fishing industry makes.
18. Tourism is now easily the second largest contributor to the economy representing an estimated £10 million per annum and growing. Agriculture has slipped into third place but will always be important. Government policies, not least in relation to continuing to encourage business improvement on farms through the Department of Agriculture's Ten Year Plan, including support for the meat industry and the new wool marketing company, will continue next year.
19. We have a low tax economy that has helped business confidence and investment to remain high. We have an active Chamber of Commerce with over 90 members. The last business climate survey conducted by the Falkland Islands Development Corporation revealed that 90% of businesses were anticipating growth even though typical businesses are very small. A sample of company tax returns undertaken by the Tax Office reveals that the profits of 18 out of 31 companies had increased by 10% between 2001 and 2005. There is real business confidence in the Islands' future.
Mr Speaker,
20. The future success of our economy depends, to a large extent, on the investment that the Government makes in education. We have a teacher/pupil ratio that is the envy of many but we still aspire to levels of achievement to compare favourably with the UK. The Director of Education is pursuing various initiatives aimed at securing improvement. The public consultation on the structure of the Education service should result in changes for implementation during the next financial year. The objective is to improve the quality of the education service in order to improve the success of our students.
21. The Government usually supports about 55 students a year to pursue their studies overseas, at a cost of £1 million or 20% of the Education Department budget. Education is an expensive business but, as someone once said, "If you think education is expensive, then you should try ignorance." It is an investment in our future. We are about to benefit from the UK Government's decision, after much lobbying effort, to treat OT students as "home students" for the purpose of tertiary level fees. For the coming financial year, the cost of fees per higher education student in the UK is set to reduce significantly, and the Government will consider carefully how to use these savings to best advantage.
22. The Training Unit has also responded to areas of skills shortage identified in the Training Needs Analysis conducted in 2005. Over 80% of the areas of need have been met. Of course, many school leavers, for a variety of reasons, do not continue their education overseas. Discussions are underway with Chichester College to explore the possibility of an Annexe of the College being sited here in the Islands. This is an exciting possibility, which I hope will be pursued vigorously.
23. Good communications remain vital to our future success. The Integrated Transport Study has been completed this year and is guiding future investment in transport infrastructure. The Islands Plan target of 95% of the population on East and West Falkland having access to the main road network within 30 minutes drive has been achieved. Investment in roads will continue next year: the emphasis will shift towards higher standards of maintenance and capping. The new Coastal Shipping Service, including a weekly cross-Sound ferry using new terminal facilities which are to be constructed at Port Howard and Newhaven, is expected to begin in December and a review of the service offered by FIGAS has begun. FIGAS and Coastal Shipping freight rates are also in the process of being examined in anticipation of the introduction of the Coastal Shipping Service.
24. FIPASS has been the main civilian marine port of entry for the Falkland Islands since 1988, but there is growing recognition that its facilities are restricting economic potential. The Government has commissioned a series of studies on different aspects of port development - the latest being undertaken by Royal Haskoning. This should take us a step forward but there can be no doubt that both the fishing and tourism industries need better facilities if they are to develop - as will the next hydrocarbon exploration round when it arrives, as we hope it will.
25. Modern communications must include modern telephony and electronic communications. We now have broadband and mobile phones, courtesy of Cable and Wireless, even if expectations go further. The Camp telephone system must be replaced. Detailed proposals are being formulated which, it is hoped, will include the ability to deliver television signals. And we are preparing for the digitalisation of BFBS.
26. Access to the Islands by air is also vitally important to the development of the economy. Whilst many people moan about the Airbridge, it has with the weekly LAN Chile flight proved to be an essential lifeline to the Islands. There is recognition that the MoD, the Foreign and Commonwealth Office and the Falkland Islands Government need to work together to review the service. It's no easy task with a whole series of objectives that are not always complementary. Nevertheless, we are exploring improvements to the Airbridge without compromising its primary function in support of the British forces. We hope this financial year to negotiate a new Joint Policy Statement that will set the parameters for an improved service.
Mr Speaker,
27. Perhaps the service most highly valued by the community is our excellent health service. Expectations of the health service are very high. But it comes at a high price - well over £6m per annum - and expectations may have to be tempered by budgetary realism (or by agreement to contribute more to costs). The Government has increased investment in dental services. There are new dental surgeries under construction and extra staff. And, separately, Government has recognised the importance of mental health with the recent publication of our first Mental Health Strategy.
28. I shall not get into the no-smoking debate except to say that smoking has wider ramifications than an individual's health, just as the risks involved in not wearing a seat belt and talking on mobile phones whilst driving have wider health and safety implications - is that controversial enough?
29. The Government remains committed to investment in agriculture as an essential element of the Falkland Islands economy. A viable Camp is a central theme of Government policy. The census carried out last year shows a further reduction in the number of people living in Camp. This is not necessarily a disaster. Modern agricultural practice needs fewer people than in previous generations; so, perhaps, the measure of a viable Camp should be one which measures the economic success of life in Camp rather than simply the number of people. From the Government's perspective, it is better that those who choose to live in Camp can do so successfully and in a sustainable way rather than requiring continuous support from Government. It's therefore pleasing to see that in 2005, 77% of Camp businesses recorded a profit. We'll see what the figures for 2006 bring but the various FIG initiatives, including the introduction of the weekly ferry service later this year, should create business development opportunities for Camp, and generate more on-island tourism. I know that the Development Corporation plans to establish a regular presence on West Falkland to work with business there to exploit the opportunities offered by improved communications.
30. The Development Corporation is also hosting the Aquaculture Development Project. This is very much a demonstration project working with the local fishing industry. With European Union support, £600,000 has been earmarked for the project over a three year period and preparations are well in hand. If it shows that aquaculture is viable here, then it will represent another good opportunity for economic diversification.
31. Global warming is the catchphrase of the day. For us under the ozone hole and reliant on fisheries that are susceptible to changes in water temperature, it is an issue not to be ignored. So, it is good to point to two projects. First, the recently completed project to recover waste heat from the power station to heat the Community School and the hospital. And second the Wind Farm currently under construction at Port Harriet. Taken together, these projects are expected to reduce fuel consumption by 1.1 million litres per annum and to reduce carbon dioxide emissions by 2,800 metric tonnes per annum. If the wind farm project is successful, I hope that the government will think about a second phase - not least because the current project is predicted to pay for itself in 6 years.
32. Conservation of the environment, essential in itself, is also crucial to our tourist industry. The Falkland Islands are a world leader in identifying and implementing, with the fishing companies, measures to prevent the needless slaughter of Albatross and Petrels. FIG is a major sponsor of Falklands Conservation in the effort to protect our exceptional natural environment. Greater emphasis is also being placed on the preservation of the built environment. But we need a proper tourism strategy to guide public and private investment. Should we, for example, protect our battlefield sites from trophy hunters and improve the facilities and attractions for tourists? We must ensure that the success of the industry does not actually damage the very things that attract our visitors. And so I for one hope that a dialogue can be opened with the cruise ship operators to achieve a sensible pattern of itineraries that does not see Stanley flooded with thousands of visitors one day and then no-one for several more days before the next tsunami-like wave arrives. This is far from ideal for local traders and cannot leave our visitors with the right sort of lasting impression of our country and its capital.
33. Another theme of the Islands Plan is the commitment to maintain a vibrant and safe community. Crime remains low and detection rates high but the criminal environment is changing, with new forms of crime, such as internet paedophile pornography. We need to review the training and staffing needs to equip the RFIP better to meet such new challenges. The plans to provide a new prison and to address the long overdue re-furbishment of the police station are now well advanced and, all being well, work will begin within the next few months. The Force has had a difficult year - and we shall appoint a substantive Chief Police Officer soon - but I have been impressed by the professionalism and commitment of its members to get on with the job. Being a police officer in any small community is not easy. We should lend them support, not criticism, and take care not to allow standards to drop, either within the Force or more widely within the community. It might, for example, be considered by some fair game to remove items from a stranded ship but it is stealing and that should not be indulged.
34. This year, we shall have a new Chief Justice, Senior Magistrate and Attorney General. I must acknowledge the considerable contribution of our outgoing Chief Justice, Judge James Wood, and Senior Magistrate, Clare Faulds, to the administration of justice here. I also want to thank Robert Titterington for returning to the Islands as Attorney General for a few months and to thank the government of the States of Guernsey for permitting him to do so. And I would like to acknowledge the great contribution made by David Lang over his many years of service as Attorney General.
35. Still on quality of life issues, FIG has approved its first comprehensive housing strategy following public consultation and, arising from this, has announced a review of the Stanley Plan. The strategy aims to provide the climate in which a wider range of house types will be provided and to generate more activity in the private sector by promoting the release of private sector owned land for housing development. A new mortgage scheme has been developed with Standard Chartered Bank and a shared equity mortgage scheme is being developed to provide access to home ownership to people for whom the purchase of a home may currently be little more than a dream.
36. Our young people will ultimately determine the future success of life in these Islands. The Falkland Islands have now produced an action plan on how to improve our compliance with the UN Convention on the Rights of the Child. An inclusive steering group has been established, tasked with implementing action. The aim is to ensure that all children and young people in the Falkland Islands are safe, healthy and confident and have the opportunity, through education and recreation, to develop and make a positive contribution to the community.
37. This brings me to the final strand of the Islands Plan. The government is responsible for the prudent management not only of public expenditure but also of the economy as a whole. Last November, the FCO Overseas Territories Economic Advisor, and a consultant from Oxford Policy Management, visited the Islands to undertake a review of government's fiscal management. Their report endorsed government policies and made no recommendations that would suggest a major departure from established financial strategies. The Consolidated Fund stands at 2.7 times annual operating expenditure and public expenditure is under firm control despite the pressure and demands placed upon it. Nevertheless, one of the government's main strands of income is from the Illex fishery, which is highly susceptible to external influences beyond our control. I am pleased to note, therefore, that the government is beginning to think about preparing its financial plans on the basis of treating income from this fishery as a bonus or windfall rather than relying upon it as we currently do to the tune of around £6m a year. This will be quite a challenge in a budget of just over £40m for all government expenditure. It could be done but would probably take several years to achieve and would require a mindset change about what government should spend its money on. Quite simply, something would have to give; consumer expectation and demand would have to be managed far better than they are now. But perhaps that's what we should be doing even now?
38. One of the issues to which London attaches importance is disaster management. Recent disasters elsewhere have shocked the world - and there are all too many disasters that could happen here. We are not immune. The Capability Review team that visited last month should give us a clear view of what we should do - and the Fire Service review has also given food for thought. We are fortunate in being able to rely on assistance from the military but we need to refine our crisis response plans and ensure that they are regularly practised.
39. Finally, I have to express some surprise that Helen and I have been here now for 9 months. Time has just flown by. We have seen and experienced much in Stanley and in Camp and have been touched by the welcome and hospitality that has been shown to us. There are many more places to visit and people to see before I can begin really to understand the issues facing these Islands. I welcome the very real support that CBF and his military colleagues provide both to me as Governor but also to the people of the Falkland Islands.
40. I have certainly been impressed by the range and complexity of policies and problems coming to Executive Council - and I pay tribute to the dedication and commitment of Councillors and also to the high standards and professional qualities of our public servants who work on our behalf. I am deeply conscious too of the selfless dedication of those who work in the voluntary sector, in our youth groups, and those involved in supporting charities. There is a lot of hard work going on in this community, often by people who don't seek the limelight. The success of the Falklands today is a tribute to you all.