We need a stimulus plan
I have been reading with interest the stories that Bermuda has finally accepted there is a recession and that it is likely to affect Bermuda as severely as it is affecting many other countries. The reality check is from such actions as the retail sector practically grinding to a halt and a number of job layoffs occurring in both local and international companies.
Minister David Burch's speech to the Public Service Union, hitting out at what he called "the culture of greed" and urging Bermudians to work hard and improve their training etc. was the first major speech on the recession from Government I have read or heard coming from Government. I may be wrong, I may have missed something. I have long been waiting for major directions to the public about the recession from Minister Cox the Minister of Finance. Again I may be wrong, but I do not recall seeing or hearing anything major from her on this subject.
Marina Mello's story on "Bermuda feeling the job crunch as a result of the global economic downturn" should be a wake-up call for all Bermudians. It was a very well done and informative story about the reality of the effects of the recession on Bermuda. I am very concerned about the effects this recession is going to have on Bermudians, particularly lower income Bermudians and their families, and how long it will take Bermuda to recover from those effects.
I agree with much of what Minister Burch had to say in his speech. Bermuda should take his comments seriously, especially those about working together and helping one another. I will comment later on his Bermudians-first approach and how he intends to handle non Bermudian workers in some instances. I have some comments with some aspects of that part of his speech.
Minister Burch spoke largely in general terms (urging Bermudians and non-Bermudians alike to work together) through these difficult times. I would like to add and elaborate on one important specific under his call. That is jobs. I do so as a result of some of my past experiences in government but also very much from what is being done in Australia, where I am currently visiting.
One of the major policies during a recession should be keeping people employed. There are several programmes that can be put in place to achieve that goal. It takes, of course, the cooperation of both the employer and the union or the employer and the employees where there is not a union present.
Here in Australia many companies and governments, federal and state, have implemented one or two of the following programmes or a combination of them to keep people working:
¦Employees and management agree to take a ten or 15 percent cut in pay until economic conditions improve.
¦Employees and management agree to take a cut in pay with a commitment that what is lost will be recovered to the employees pay package when economic conditions improve.
¦Employees and management agree to forego a pay increase until economic conditions recover.
¦Employees and management agree to work a four day week.
¦ These programmes assume benefits and pension will remain tied to the substantial wage.
There are other creative schemes that can be applied, but the idea is for management and employees to approach working out a scheme that best suits them to reach the goal of keeping everyone working. I am sure the unions and employers in Bermuda are discussing such schemes. However I thought it would be reassuring to let all Bermudians know such plans are being implemented in other countries as well.
I only hope that everyone will heed Minister Burch's call to work together and help one another by doing so in a spirit of cooperation. Hotels, Government, the banks and a collective international business are the largest employers in Bermuda and they should set an example.
Minister Burch reiterated the government policy of Bermudians being hired first and that Bermudians should be the last employees to be made redundant. We all agree with that policy and support. The Minister was reassuring Bermudians he has their best interest at heart. The other side though is for the non-Bermudian worker and management to feel that Government does not have their best interest at heart. I firmly believe the Government must handle this area during these times with great sensitivity to also protect Bermudian jobs.
It is said that every non-Bermudian job at a management and or professional level creates at least two jobs for Bermudians. They also rent houses and apartments from Bermudians. The rental of houses and apartments is a major part of the Bermudian economy, therefore keeping units rented during this economic downturn is one area that will help Bermuda quite substantially. We made a mistake during the last recession when 7,000 non-Bermudian workers left Bermuda. The economic recovery then took longer than it woul dhave done had they stayed.
I would urge the Government to work with the international companies and do everything possible to encourage them to hold on to their employees. This may entail providing them with certain reassurances.
Finally, I give praise to the Minister for speaking out and encouraging Bermudians to do as much as possible to help themselves during this recession. I am however very disappointed that other parts of the Government, namely the Minister of Finance and the Premier, have not put forward a stimulus package for Bermuda, and I hope it will come in the Budget on Friday.
This gives me cause for concern for any family that does lose their job, how are they going to feed their families and send their children to school, and also for the poorest of the poor and many of our elderly.
I know personally that many Bermudians are hurting now. I ask the Premier Dr. Brown to put forth a stimulus package or tell us why we do not need one.
I also urge the Government to lead by example and do what other Governments have had to do and cut all Government spending by 20 percent or 30 percent except in construction, health, security and in areas that affect the poor and the elderly.