February 28, 2014 at 5:33 p.m.

PLP's Budget reply: Talk of economic recovery is premature

Bermuda 'in need of dynamic change' and PLP offers a raft of proposals to 'empower' citizens
PLP's Budget reply: Talk of economic recovery is premature
PLP's Budget reply: Talk of economic recovery is premature

The PLP has rejected the call for privatization of government departments and proposed a phasing out of tax subsidies over the next two years that could save the island $45 million.

In his official reply to the Budget, Shadow Finance Minister David Burt painted the OBA-government as wrong-headed, hypocritical and out-of-touch.

He took issue with some of Finance Minister Bob Richards’ comments about the state of the economy, saying the island’s lowered unemployment rate was “less a function of more people working and more a function of people giving up looking for work”.

Mr Burt challenged the notion that the country is turning the corner and said the OBA’s fiscal strategy represented “an austere approach that will harm the economy”.

“The OBA is at war with itself and with its core values,” he said.

He called for a tighter regulation of BELCO: “What is missing is the creation of a regulatory environment that imposes a social conscience on this monopoly.”


Mr. Burt rejected the notion that the OBA has controlled government spending, citing travel expenses and $45 million worth of additional spending.

He also cast doubt that it would be possible to cut $70 million in spending, as the government has proposed to do, without layoffs or wage concessions. Mr Richards had said that his Budget does not call for layoffs, but public job losses could become a reality next year without significant government restructuring.

Mr Burt also proposed phasing out tax concessions for the hotel, restaurant and retail industries over a two-year period. Such a move would yield $15 million the first year and $30 million the second, he said.

He needled Mr Richards for what he deemed to be an apparent about-face on privatization. He quoted Mr. Richards in 2012 as saying privatization of government entities was not part of the OBA’s plan.

“The minister has moved from being completely opposed to privatization before the election to now being its champion,” he said.

Privatization, he said, is not a financial panacea.

“The unions are right to take a firm stand against privatization and the PLP will stand side to side with the unions to ensure that any changes in the structure and organization of government and delivery of services do not adversely impact workers, roll back rights or increase costs to everyday Bermudians.”

Mr Burt also said the grievance process in the public sector should be streamlined so that “managers have the tools to deal with those who would rob our citizens of our tax dollars”.

Bermuda, said Mr. Burt, should also look to foster growth in the online gambling industry.

The PLP favours regulating and taxing cannabis, said Mr Burt.


The lack of bank lending on the island is restricting economic activity, he said.

He called for reforms to the foreclosure and debt collection processes.

“Our current system damages the family unit, makes criminals of the unemployed and creates more harm than good. Stories about persons avoiding medical care for fear of being jailed for debts have no place in a society like ours,” he said.

The rate of interest applied to judgment debts is too high, Mr Burt said. He wants the rate reduced from 7 per cent to 3 per cent.

The immigration rules also need to be changed: “Bermudians are not hostile to guest workers in international business,” Mr Burt said, “they are hostile to guest workers who are fully employed in the local, non-international business economy while willing, able, skilled and college educated Bermudians sit unemployed”.

He added: “Our economy is broken, and the OBA government seems to be falling into the same trap as the former PLP government – wait and hope that international business stabilizes and we can attract more jobs to our shores. This ‘wait and see approach’ ignores the fact that the trend of outsourcing is ultimately irreversible.”


 

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