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Headlines:
“Significant” deficit in budget.

Tiphanie is crowned May Queen
Inside Penguin News.

Tiphanie is crowned May Queen

RIGHT: Fifteen year old May Queen, Tiphanie May, receives her tiara and sash from His Excellency the Governor, Mr Howard Pearce. Tiphanie was chosen for the honour by a panel of three judges at the annual May Ball held on Friday, May 21. May Princess was Tamara McCormick and Prince Charming was Jon Felton.

?Significant' deficit in budget.

Some of the 2004/2005 budget measures:

Vehicle licence fees increased Import duty on tobacco tax raised by 10% Service charge introduced for water and refuse collection £250 Holiday credit scheme cut by half - now 50p per day Increase in charge for spectacles Subsistence for medical patients referred overseas withdrawn Stanley House Boarding Fees increased 50% Leisure Centre swimming fees increased Higher Education students grant reduced by £1,000 Electricity price increased by 0.5p

THE budget deficit in this financial year is "significant" however losses should be replaced in two to three years. Speaking after the official confirmation of the budget measures for the 2004/2005 financial year, Chairman of Standing Finance Committee Councillor Mike Summers confirmed the government is facing a deficit which will be funded by the government's reserves. He added that the government will also face a deficit of £3 million next year, "...but after that we should at least be back to balanced budgets and some kind of surplus and we will aim to replace the losses we have made over those couple of years." Councillor Summers said the projected deficit of £3 million, "...has some major assumptions in it. On the income side, illex income is expected to be significantly less than in past years; we know for example that up to £2 million of refunds still have to be made, but there is also potential to exceed target income if licence sales go well. "On the expenditure side, in setting the budget virtually every department in the government has had its budget reduced. Some of those reductions are specific, others are targets not yet specifically identified that may be difficult to achieve in one year. "The size of the deficit will therefore depend on final outcomes in these areas." In spite of the cuts, Councillor Summers said the security of the Falklands' future is in no doubt: "We just have to manage the economy sensibly and to deal with demands on expenditure in a sensible and sensitive manner." Chief Executive Chris Simpkins said the government is keen to ensure investment in the future. "We have got to look to build up other lines of income and indeed boost the existing lines of income and there is every reason for optimism..." He added, "We shouldn't forget this is the only Overseas Territory that is financially self sufficient. We are actually in an extremely good position and there is no reason whatsoever to suspect that that is going to change." Mr Simpkins said the government needs to avoid a "boom bust approach". He explained, "That's why you are seeing the sensible use of the Consolidated Fund to smooth out those troughs, and to return funds to the Consolidated Fund to smooth out the peaks. "That's exactly what it's there for, it's why it was built up as a nest egg over the years and we are just making a sensible use of it." Addressing criticism that the government is taxing the cruise industry when it should be trying to attract more visitors, Councillor Summers said the income raised from an increased charge for passengers will be used to pay for added security. He said, "This is not a charge that the government is going to use to be any better off. It is a charge to stop us being even worse off. There are now significant costs for providing security services for cruise vessels, as indeed there are for airlines. "We are just trying to cover a real cost and I don't think the cruise vessel industry themselves will be deterred, nor will they be surprised. "The security issue is one that they are very acutely aware of - they won't come here if we don't provide proper security services - it's something that they demand - so, inevitably, it should be their passengers who pay for it." Included in the revenue measures approved by Councillors is a service charge which will amalgamate the existing water charge and a new refuse collection charge for domestic premises in Stanley. Financial Secretary Derek Howatt said the £250 charge each year, "...won't totally recover the cost of the refuse collection service - it will be about £15 short of the full cost." Boarding fees for children living at Stanley House Hostel have been increased by 50%. Councillor Summers described the existing fee of £1 per day as, "pretty cheap". He said, "The suggestion was that it should be increased to £2 a day, which is still pretty cheap, but we thought that was a bit much, doubling it. One pound fifty a day as a boarding charge for a child really isn't very much money." When asked if this increase is affecting those in the community who can least afford it, Councillor Summers responded, "We hope not and we think not. I doubt there are many parents who can't afford £1.50 a day. "As the Financial Secretary has said on a number of occasions...if anybody is in genuine hardship there are ways of dealing with it. So if anybody genuinely can't afford to pay and can demonstrate that, then the government will pick up that cost."

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