OBA Budget Reply: ‘Economy has fallen into gigantic pothole’
A One Bermuda Alliance government would slash red tape, make debt reduction a priority and create a plan to reduce the cost of energy.
Giving his Reply to the Budget, the Opposition leader Jarion Richardson also said the OBA would replace the block grant for the Bermuda Hospitals Board with a fee-for-service model and would work to make government more efficient.
He took aim at the Government. He said: “Under this PLP government, our economy has fallen into a gigantic pothole — not unlike most vehicles on our roads today. We are spinning our wheels, struggling to drive out.”
In his first Budget Reply as OBA leader, Mr Richardson said: “Debt reduction will be a major priority. We should have minimum debt.
“There will still be debate on what the right debt level needs to be but it can no longer be suggested that current levels are acceptable — they are not.”
He admitted that would mean making some “tough decisions”.
“Most Bermudians families know what this means,” he said. ”They know that when income shrinks or jobs are lost, and obligations like debt and other expenses grow, changes have to be made.”
He said that with less debt, the Government would have an extra $100 million to support infrastructure and put towards reducing taxes.
The OBA, said Mr Richardson, would “boost tourism, by aggressively searching for and courting investors who we can trust to deliver and who will trust us to be good partners”.
He said to address the cost of living, the OBA “would cut red tape to allow for innovative and effective building approaches and designs”.
“We need to make it easier, cheaper, and faster to construct comfortable and high-quality homes.”
In addition, said Mr Richardson, the OBA “would create a plan to reduce the cost of energy across the island, not just give away light bulbs”.
On bureaucracy, the OBA leader said: “Ultimately, growing our local economy and increasing demand is the best way to support our Bermudian businesses. But greater support is needed — and we will strip red tape from government processes, where they can be streamlined or even removed.
“The OBA fundamentally believes that government’s job is to create the best conditions for Bermudian business success and then get out of the way.”
Under an OBA government, said Mr Richardson, there would be support for local agriculture to grow food on-island to keep money circulating locally and a plan to end the “looming pension crisis”.
On healthcare, an OBA government would reverse the PLP’s block grant for the King Edward VII Memorial Hospital, allowing it to return to a fee-for-service model.
“This allows the hospital to generate more business and create additional revenue to help cover its costs. It also encourages accountability, to reduce overuse.”
He added: “We would grab the horns of our national healthcare dilemma. We know our people are not as healthy as they should be and that healthcare costs too much.
“We would work with the healthcare professions, insurers, and business to streamline and reduce those costs, while expanding healthcare so that all Bermudians continue to have the access they deserve.”
Government needs to be made more efficient, Mr Richardson said in his Reply, adding: “Those who seek to play political games translate this to mean we want to lay off government workers.
“This is simply not the case. Instead we need a more efficient government, with enhanced service provision.”
He did concede that a hiring freeze could be required in certain segments of the public sector and that consideration would be given to early retirement packages.
“We would also work together with government workers to identify ways to streamline, connect and centralise how government serves the people,” added Mr Richardson.
In his Budget Statement, David Burt, who is also the Minister of Finance, forecast the first balanced budget for more than 20 years, predicting a surplus of $210,000.
Jarion Richardson, the OBA leader, took exception to the forecast in his Budget Reply.
He said: “The Minister of Finance is boasting of a so-called balanced budget for the upcoming financial year. The proof will be in what the Government actually does, especially when faced with political pressure.
“And, since this budget used $40 million of borrowed money, it’s not actually balanced. As Bermudians with a loan or mortgage know, it doesn’t matter when the money was borrowed — last year, the year before, or this year — it’s still spending borrowed money — and running up interest fees.
“This on top of pulling $10 million out of the Sinking Fund last year to pay off the Gaming Commission guarantee. All told, by the Government’s own numbers, this budget will increase net debt by $38 million versus revised projections for last year.”
In his Budget Statement last Friday, David Burt said it was expected that the new corporate income tax could increase government’s revenue by as much as $750 million.
The Premier said: “Even if the Government were only to receive half of the estimated cash inflows that our advisers have stated could come to the Government in the next two fiscal years, $187.5 million in 2025-26, $375 million in 2026-27, there will be significant additional funds.”
In his Reply, Mr Richardson said the Premier was “gambling with Bermuda’s future in the hopes that the forthcoming corporate income tax will be the magic solution for Bermuda’s economic problems”.
He said there might be upsides to the CIT but they were hard to quantify and it was not yet known how the tax would impact the island.
“The OBA’s approach at this time is to plan for Bermuda’s financial future without the benefit of the CIT.
“When, or if, the CIT comes into effect and we learn more about the actual financial impact, then, and only then, can we reliably incorporate the CIT into our financial planning.
“Put another way, we hope the CIT will work out but we also need to be ready if it does not.”
Mr Richardson said: “Most people in Bermuda agree that the PLP government has been ineffective. Its pronouncements and proclamations have been unreliable. The public has lost confidence in this government.
“And the public are right. Despite the Government patting itself on the back with this Budget, outside of international business, the economic situation for most people in Bermuda has stalled or gone backwards.
“Under this government, the island has deteriorated. Just look around. Miles of potholes. Exorbitant grocery bills. Vacant buildings. Increased homelessness. No local job growth.
“The list goes on and on. Sadly, all this has become Bermuda’s new normal. And this has to change.
“The OBA offers a ‘back-to-basics’ approach, doing things the way they ought to be done. Our plans are designed to lay a new foundation for a strong, fair, and prosperous community.
“Our island has reached a turning point. We know that Bermudians — now more than ever – are ready to come together to stop the decline.
“The One Bermuda Alliance makes this commitment to those who join with us: we will produce real results to improve lives every day, from the cost of living, to the ability to find good jobs.
“Responsible spending. Social fairness. Strong communities. A prosperous future. It’s what every Bermudian needs.”
• To read the full Budget reply, see Related Media
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