The public purse is in safe hands despite recent "alarmist and irresponsible" comments, Paula Cox said yesterday.

The Finance Minister said the comments had caused "some disquiet, some confusion and unease" in the community.

She said in a Ministerial Statement: "The Ministry's prudent handling of Bermuda's public debt has been reviewed by external, objective credit rating agencies such as Moody's standard and Poor's and Fitch Ratings. In each and every case, the scorecard has been at the high end of satisfactory.

"Bermuda has an investment grade sovereign credit rating that means that lenders have a firm belief that the loans will be repaid when they fall due. Mr. Speaker, this belief seems not to have featured in the debate in recent weeks. Further, some of the participants in the debate seem to have forgotten what the public sector borrowing was for."

Auditor General Heather Jacobs Matthews this week warned that Government faced "financial challenges going forward" as it tackles rising debts.

In her statement, released 25 days before the announcement of the 2010/11 Budget, Mrs. Jacobs Matthews showed how expenditure had outstripped revenue for every one of the past six fiscal years. And she also showed the accumulated debt the difference between what the Consolidated Fund owes and what it owns was $719.9 million at March 31, 2009, up $102.4 million from a year earlier.

Ms Cox said yesterday: "Debt is a feature of household finance business finance and indeed public finance. In all three spheres, debt is used to assist in the financing of assets that have a medium- to long-term life. Such assets add to greater convenience, comfort and well-being for households, a competitive edge and greater profit capacity for business and enhancements to the delivery of public goods and services for Government."

It was the role of government to borrow to finance facilities needed for a country's physical and social infrastructure, the Finance Minister added.

She said that $447.2 million was borrowed and spent on 163 projects. Of that total, $143.4 million was spent on education, $28.2 on new facilities in health care and $80.6 million on airport works and seaport infrastructure.

A further $127 million was spent on the Island's new recycling centre, the refurbishing of ferry docks and public landings, major building upgrades, Pembroke Marsh, the expansion of Tynes Bay Waste Treatment Facility and schools maintenance. The National Sports Centre and open spaces at other projects totalled $31 million.

"This is partial accounting of where the borrowed funds have been invested," Ms Cox added. "I have not delved into the details of capital acquisitions such as laboratory equipment, buses, ferries, office equipment and furniture which would complete the picture."