To His Honour the Speaker and Members of the Honourable House of Assembly:

Mr. Speaker,

The unthinkable events of September 11 broke our hearts and unsettled our souls. The impact of the horror in the United States was felt here immediately. Bermudians lost loved ones and colleagues. Workers lost jobs. Businesses lost customers. As we gathered together to mourn the loss of life, we also grieved for the loss of that relatively safe and secure world we took for granted.

In true Bermudian fashion, people responded to the crisis with courage and great generosity of spirit. And yet we knew, in our hearts, that our special way of life-the Bermudian way of life-would, in some way, change forever, along with the rest of the world.

In case anyone doubted before, it is now absolutely clear that Bermuda is not isolated but fully connected to the global community. This means we are and will continue to be vulnerable. Our prosperity and our quality of life are at risk as never before. This unprecedented situation and continuing uncertainty demand a return to strong, visible leadership and good government. The United Bermuda Party Opposition believes that the fundamentals of good government are far more important to the long-term stability and prosperity of a country than political party positions on issues of the day.

We are talking about the covenant that exists between a democratically elected government and the people it serves. When Bermudians vote, they give their permission for others to act on their behalf. Their elected leaders implicitly promise to respect public opinion, remain accessible, represent the interests of all the people, focus on the people's business rather than their own and understand who put them there in the first place.

Mr. Speaker,

Every day, the United Bermuda Party hears the anxious voices of Bermudians who are concerned that the fundamentals of good government have been forgotten. In our homes, in our churches, in the workplace, on the streets, and in the media, we listen carefully, while those in authority are absent or choose to ignore.

For some time now, the PLP Government has been dismissive of public sentiment. One year ago, former Opposition Leader Pamela Gordon spoke eloquently about the PLP Government's lack of public consultation on constitutional reform. She said, "A modern democratic government gives the people of the country the dignity and respect of telling them what its plans are, and trusts the people enough to ask for their opinion and approval.

This PLP Government is proposing to change this country's constitution with even less warning, less debate, less public explanation and less public scrutiny than almost any ordinary piece of legislation. Do they take the constitution of this country so lightly? Do they not trust our people at all?"

A year later, we have answers, but they are not reassuring. Despite a petition of more than 8,000 signatures requesting a constitutional conference and referendum and independent polls showing most Bermudians in favour of a referendum, the PLP Government pushes ahead with constitutional reform without a single concession to public opinion. It is worth noting that the PLP Government's Throne Speech barely mentions constitutional reform, although the Boundaries Commission will begin work soon and submit its report for debate before the end of the parliamentary year.

Unfortunately, constitutional reform is not the only issue through which the PLP Government has demonstrated its lack of respect and trust for the public it serves. Here are a few more examples:

The failure to answer all questions surrounding the tendering process for the $70 million Berkeley construction contract;

the failure to release a comprehensive, independent tax review completed in 1998 and intended to stimulate broad community discussion on Bermuda's tax policies;

the failure to fully inform the community of specific commitments made to the OECD in 2000;

the failure to release the 1999 civil service review, which recommended major changes in the structure and operation of Bermuda's government;

the failure to release the Review of the Bermuda Regiment 2000;

the failure to release the report on the potentially dangerous mishandling of asbestos by a PLP MP at Southside-more than 18 months after the incident occurred;

the failure to investigate and release information concerning pyramid schemes that adversely affect the well-being of many members of our community;

the failure to disclose the details of the attempted purchase of Cragmore estate for use by the Ministry of Tourism; and

the failure to explain how oversized cars for Government Ministers serve the public interest.

This isn't personal information the people are asking for; this is public information. And a good government, committed to serving the public, would release it.

The Government's Legislative Plan

Mr. Speaker,

The United Bermuda Party has no argument in principle with much of the routine legislation outlined in the Throne Speech, but we find it sorely lacking in vision, hope and inspiration at a time when our country is most in need of reassurance. Tourism, after three years of progressively bad news, has gone into a death spiral. Hospitality and retail workers are facing a grim winter. Anthrax scares bring fears of bioterrorism close to home. We worry about family members flying back and forth over the coming holidays.

A wet blanket of uncertainty and concern has settled over the island, and, regrettably, this Throne Speech provides little to relieve our anxiety. The PLP Government has failed to offer a comprehensive, integrated and substantial plan that addresses the needs of both individuals and businesses impacted by recent events.

The Economic Climate

Mr. Speaker,

It would be easy to blame the terrorist attacks and ongoing conflict for our tourism crisis and uncertain economy, but it would be wrong. While the events of September 11 demonstrate Bermuda's sensitivity to the US economy, the writing was on the wall long before. As the United Bermuda Party stated in our Reply to the Budget in February, the United States economy was slowing by the end of last year, accompanied by a steady stream of job-loss announcements and a January plunge in consumer confidence.

Here in Bermuda, visitor arrivals and expenditure numbers were way down. Retail sales were depressed last year, particularly in the second half, and things look even worse this year. The formation of new exempt businesses began to slow in the 3rd quarter of last year. The balance of payments surplus on current account declined by $63 million in 2000 from the previous year. The number of jobs in Bermuda declined in 2000 and will probably decline further this year.

Mr. Speaker,

Why did the PLP Government ignore these warning signs? Why did the PLP Government introduce a budget that contained over $74 million of additional spending that required a dramatic increase in taxes and over $50 million of new debt?

If the PLP Government had taken a more cautious approach to this year's budget, they would find themselves in a better position to respond to the current situation.

Two months after telling us not to panic, the PLP Government has finally begun to address the current situation and to reverse decisions they made nine months ago. We applaud land tax relief for senior citizens, but they have been made to suffer unnecessarily for too long under the PLP Government. And we remind the government that this is their third attempt to get land tax right for our seniors.

While the payroll tax concession is a step in the right direction, a close look at the details shows that the PLP Government plan is not overly generous. When the proposed tax concession is calculated for a small business with an annual payroll of $100,000, the total savings is only about $50 per week. It remains to be seen whether this token assistance will be adequate to prevent layoffs or closures.

As proposed, the concession applies only to the first three months of 2002, traditionally a quiet time when levels of employment and the impact on government revenue will both be at their lowest. While this may help government's bottom line, the concession applied to the current quarter-October through December-would be more meaningful to most affected employers. We would also suggest that government consider deferring this quarter's payroll taxes until April to assist with cash flow and provide additional incentive to maintain employment levels.

The government's modest attempts to provide tax relief will be insufficient to address a protracted downturn in Bermuda's economy. We hope the list of job losses and store closings does not have to get any longer before the PLP Government takes this situation seriously.

Mr. Speaker,

Government needs to share the pain and tighten its own belt. The Finance Ministry should establish quantifiable goals for cuts in government spending and dispense with the vague promises put forth so far. The $4.4 million government travel budget and the $112 million capital expenditure budget are good places to start. Projects addressing immediate needs, such as housing or education, should proceed. Others should be deferred or eliminated. Remember that Bermuda's recession in the early 1990s lasted for three long years. A smart government would delay the start of some projects in order to create jobs when really needed at a later date.

The structure of Bermuda's economy has been changing for some time, but the Finance Ministry has released no information indicating it is committed to examining this issue. The comprehensive tax study completed in 1998 by two highly respected consultants should be released immediately to initiate a broad, community-based discussion of how Bermuda raises revenue. The recommendation contained in that document for a duty-free scheme for tourist-oriented retail businesses could well have been in place by now, and the retail sector might be better positioned to weather the current storm. That, Mr. Speaker, is what is called a missed opportunity.

There is no legislation in this Throne Speech that seriously addresses retraining or the shift in jobs or the need to further diversify our economy. The majority of legislation affecting international business and the financial services sector has been thrust on us by the UK to address recommendations from the KPMG Review of Financial Regulation in Overseas Territories.

One bright spot in an otherwise dim picture is the buoyancy of the reinsurance industry. Already, some $4.5 billion of foreign capital is flowing into Bermuda as newly created reinsurance companies satisfy a global demand for greater risk capacity. But given the crisis in tourism, we must be careful to avoid what may become a have and have-not situation between these two economic sectors. It will take careful planning and a sensitive hand in immigration to ensure that Bermudians are not overlooked for these new opportunities and businesses get the skilled manpower they need.

Mr. Speaker,

The economic climate in Bermuda is uncertain. We could be facing a lengthy downturn in the economy. Given the requirements for careful financial management in the best of times, we question why the Premier assigned additional responsibility for the Bermuda Land Development Company, West End Development Company and Small Business Development Corporation-all critical to the growth of our economy-to the Ministry of Finance. At the same time, the Premier appointed the Minister to the Boundaries Commission. We hope this does not dilute the government's efforts to deal with the current economic challenges.

The Tourism Crisis

Mr. Speaker,

Long before September 11th, Bermuda was headed for the worst tourism year on

record. No matter how you measure tourism-by arrivals, visitor spending, bed nights, length of stay, or hotel occupancy levels-by June 30th of this year, the numbers were down by double digits. And now there is no doubt that Bermuda's tourism industry is facing its most serious crisis ever.

The Minister of Tourism, of course, had no control over the September 11th tragedy. But he must not use it as an excuse for poor performance. The United Bermuda Party holds him directly accountable for the accelerating decline of tourism in the past three years, and in the future we will hold him responsible for the way he handles the current situation.

If past performance is any indicator of future results, we are very concerned about tourism's future under a PLP Government. For three years, we have seen enthusiasm. We have seen energy and desire. And we have seen lots of hype, travel and spending. But, Mr. Speaker, what we have not seen is results.

Our hotels are almost empty. Our taxis sit idle. Our restaurants serve fewer meals. Our shops remain quiet. And our hospitality workers go home with smaller paycheques, if they have a job. In response to this extraordinary situation, the PLP Government promised in the Throne Speech to revise legislation governing time-share operations. They also said, and I quote, "As a result of Government's initiatives concerning planned events and advertising, Bermuda is well positioned to respond quickly to tactical and strategic demands in the wake of September 11. By these measures, Government has enhanced Bermuda's competitive edge, in terms of the price/value relationship of our tourism product."

Mr. Speaker,

Does anyone know what that means? Can anyone be expected to know what that means? Whatever it means, it certainly doesn't sound like what we need: a tourism recovery plan. Nor does it adequately address the immediate crisis. The fact is that the PLP Government and the Tourism Minister, elected on the empty promise of a 100-day Rescue Mission, still-after three dismal years-have no overall tourism strategic plan to share with the public. There is no cruise ship policy after three years, just a failed fly-cruise-stay initiative. After three years, there is no air service strategy.

This is not just about politics. This is about real jobs, real paycheques and real opportunity for advancement for Bermudians. As the United Bermuda Party Opposition has said on many occasions, we believe there is hope for tourism if: