The Bermuda Economic Development Corporation (BEDC) has been reinventing itself of late.

I have chaired the Board for almost 18 months now, and hope by this update to provide Bermudians with an insight into the new services we are now providing.

I also want to tell Bermudians how we are making sure that our stakeholders are getting value for money and I want to talk a little about our plans for the future.

Services

Our mandate is to provide support to small and medium businesses Island-wide, as well as targeted support to those businesses operating in the Exclusive Economic Zones. For many years now, the BEDC has provided guarantees to facilitate Bermudian businesses looking for financing.

One of our first actions to improve the accountability of businesses was the elimination of grants. The grants were not recoverable — a kind of gift of taxpayer’s money from the public purse whose effectiveness we had no real way of measuring. Not giving grants left a less-than-$10,000 financing niche, one that banks rarely entertain.

We quickly filled it with the introduction of our new microloan product, launched in partnership with Capital G (now Clarien). The microloans are 100 percent guaranteed and vetted by BEDC officers, allowing us to achieve a timely ten-day turnaround.

This product is perfect for businesses that need to replace revenue-generating assets or to execute a growth plan. It has enjoyed a high satisfaction rate and BEDC has extended the partnership offer to the other lending institutions this year.

Our Development Officers continue to offer technical advice to new entrepreneurs and existing businesses free of charge. We strive to keep the quality of our advice at a high standard, and to that end, this year one of our officers has certified as a Streetwise MBA instructor while another has certified as an Ice House Entrepreneurship instructor.

Accountability

When the Board first assumed control of the BEDC, we found it difficult to gauge the success of the existing policies and incentives due to a lack of robust key performance indicators (or KPIs).

The better part of 2013 was spent establishing, monitoring and adjusting these KPIs to ensure that we were able to effectively look under our own hood.

The exercise was not in vain, as we were able to identify a number of underutilised incentives and ineffective programmes. To give an example, we found a programme that was only being used by one business, despite seeming to be a great incentive. Under this measure, businesses could apply to HM Customs for deferment of duty on retail goods for up to three months.

This is a seemingly great incentive to assist with cash-flow, especially in these tight economic times, so the Board was puzzled that only one company was taking advantage.

After some investigation, we found out that HM Customs required a letter of credit for the deferred duty and the bank required that the letter of credit be secured, in many cases, 100 percent with cash!

This obviously is absurd for a local letter of credit, as nobody would incur fees for something they could simply pay for with cash. We are presently working on a new programme to assist businesses with the local letters of credit, so that our customers will be able to leverage their cash to their advantage. Another of the issues the Board has made a priority item is that of audited accounts.

In January 2013, when we first convened we were made aware that the BEDC only had audited accounts up to the 2008/09 fiscal year. While the management accounts had been prepared, for an organisation that espouses business best practice and is funded by taxpayer dollars, a failure to have them audited was unacceptable.

In the last 18 months we have obtained audited accounts from the Office of the Auditor General for the fiscal years of 2009/10 and 2010/11 and we are on track to have 2011/12 and 2012/13 finished by the end of this fiscal year.

Future services and plans

The BEDC is also responsible for the maintenance of a register of small, medium and EEZ businesses.

Up until now this database has been used solely for internal purposes. However, we are nearing completion of a repurposing project for the register.

We are striving to add benefits to the register to encourage a broader spectrum of participation.

I do not want to distract from the actual launch later this year by giving all the detail away, but suffice it to say that there will soon be plenty of reasons to register.

We will not let the public register be simply another layer of bureaucracy. In the fall, I will be providing more information about the part we intend to play in Global Entrepreneurship Week.