‘The best Budget of this century’

Economist and Bermuda College lecturer Craig Simmons called Bob Richards’ 2014-2015 Budget “arguably the best we’ve seen this century.” 

“This is Bermuda’s first multi-year budget,” he said.  “It is a medium-term expenditure plan, with the operative word being plan.

“For too long, we have stumbled from year to year, loosening our sails to take advantage of windfalls and trimming them to meet threats.”

Stumbling

Yet the Progressive Labour Party, authors of the stumbling-from-year-to-year policy, will have nothing nice to say about the Budget this morning in the House of Assembly when they read their formal Reply to it.

Shadow Finance Minister David Burt already set the stage for the Opposition attack last Friday with an immediate criticism of the Government’s first year in office, largely ignoring Mr Richards’ just-delivered Budget Statement.

The Government can expect him to renew the attack in the form of a finger-pointing lecture on the need for spending discipline, the need to grow and diversify the economy, the need to reduce the cost of government and the need to empower Bermudians.

These are all things the previous government failed to do, and so it will be interesting to watch Mr Burt — the Junior Finance Minister in the last years of the PLP Government — make his argument while avoiding the biggest fact of life in Bermuda today, which is that virtually every decision the Government makes is constricted by the legacy of debt and deficits accumulated by the previous government.

It will be a lecture based on amnesia.

People will have to decide for themselves whether the PLP leadership has credibility to criticize the Government’s management of the economy. Mr Burt may well put forward a worthy idea or two — and the Government will be listening for them.

But people should also consider the many other voices — business, labour and independent — who have already commented on the Budget. 

Economist Peter Everson, president and CEO of PEConsultants, said the Budget is “about as good as it can be under these difficult circumstances”.

Independent commentator Vexed Bermoothes described the Budget as “detailed, responsible and a good path forward for Bermuda.  It is designed to spur economic growth and start reining in the debt without increasing the already difficult hardships on Bermudian taxpayers”.

Many support the aims of the Budget.

Mr George Hutchings, chairman of ABIC, the organization representing Bermuda’s international companies, agreed with the Government’s strategy to grow the economy while taking action to control and reduce government spending.  He commended the Government for its “continued support of the Bermuda Business Development Agency, the establishment of the Bermuda Tourism Authority and their review of the 60/40 rule. Each of those initiatives is focused on the objectives to retain existing business and attract new businesses and revenue sources to the Island.”

Sensible

The leadership of the Bermuda Public Services Union said they were “pleased that there were no job cuts to the Civil Service” in the Budget, and supported its goal to build confidence to attract foreign investment.

Mr Simmons, the economist, concluded: “The Finance Minister’s plan is largely a sensible one. Recognizing that we are in the early stages of a recovery, he has resisted the temptation to focus on debt reduction.”

In other words, Mr Richards is trying hard to turn the economy around, but not at the expense of those in the community who are already suffering. He has not increased taxes, but has increased the amount of money Government has available to help the financially challenged.

This move was welcomed by AGE Concern, whose chairman said: “There is definitely a sense of relief from us that the Finance Minister did not introduce new taxes, which would have been an even greater burden to many Bermudians who are already struggling, especially to our seniors.”

Mr Richards’ Budget puts Bermuda on the road to recovery; a road that will surely be bumpy as we try to rein in spending and pay down the debt while caring for the most needy amongst us. It’s a plan that offers hope and stability and that, I believe, is what’s important about this Budget. 

Toni Daniels is a Senator for the One Bermuda Alliance.