A former finance minister broke ranks with the Progressive Labour Party this morning in the House of Assembly after the Opposition panned proposals that would allow first-time buyers to free up part of their pension funds for the purchase of a home.

Curtis Dickinson, a PLP MP, spoke against the National Pension Scheme (Occupational Pensions) Amendment Act 2024, saying the homeowner regulations it allowed for “should not be permitted”.

He also voted against the legislation when the House went into committee after a three-hour debate — but it was approved over objections.

Mr Dickinson told the House that he “unequivocally” took the view that “we can ill afford to be engaging in policy decisions that are designed to allow individuals to reduce their pension balances before their retirement age”.

“Instead, we should be doing more to strongly encourage them to contribute more.”

The comments, which sparked a lengthy debate, came after Jarion Richardson, the Leader of the Opposition, called the pension proposals “void of all worth”.

He told MPs that the One Bermuda Alliance “cannot support the idea of raiding pension funds”.

The regulations were tabled last week by Jache Adams, the Junior Minister of Finance, who opened the debate today by saying the proposal struck a balance between “supporting homeownership and protecting retirement security”.

They would allow a member or former member of a defined contribution pension plan, or “a member or policy holder of a local retirement product” to make withdrawals — but specifically excluded defined benefit pension plans.

The proposal would permit those aged 18 to 45 to dip into 30 per cent of their retirement funds, while people between 46 and 64 could access 15 per cent.

Mr Adams this morning highlighted the steep down payments faced by first-time homeowners and added: “We are simply providing Bermudians with the flexibility to suit their particular financial circumstances.”

However, Mr Richardson noted the island’s anticipated drop in Gross Domestic Product as the ageing population tips the scales of the workforce.

“We are going into tough times to be a senior in Bermuda, and it’s already hard,” he said.

Mr Richardson called property costs on the island “astronomical” but said “borrowing from the future and hoping it all works out” meant “putting the vulnerable population even more at risk”.

He added: “This is not going to pan out well for us going forward.”

Mr Richardson said pension contributions were “not enough today; they certainly will not be enough tomorrow”.

Mr Dickinson, the PLP MP for Pembroke South East, opened his remarks by highlighting his “almost three decades” as a finance professional, including three years as Minister of Finance.

He said: “We all broadly support homeownership in Bermuda.

“We can also agree we are supportive of people having full participation in efforts to save for their retirement.”

However, Mr Dickinson added that while the “pension gap” in the United States stood at $1 trillion annually, he could not give a figure for Bermuda’s disparity.

“I would suggest that the Ministry of Finance, the pensions commission and pension fund administrators work to identify a strategy to figure out the size of the gap, and strategies to close it.”

He also noted that the Contributory Pension Fund, the Public Services Superannuation Fund and the Ministers and Members of the Legislature Pension Fund were “all underfunded by a significant value”.

Mr Dickinson referred to Mr Adams’s statement from last week and said that the junior minister had made “a powerful point” when he spoke about keeping defined benefit plans off the table for the homeownership scheme.

He quoted the line that “any deviation, such as a one-time refund, would undermine the stability of these plans and potentially affect the long-term security they are designed to offer”.

Mr Dickinson said: “I am not sure if Junior Minister Adams was aware at the time, but those same sage words are equally applicable to why the withdrawal contemplated by this amendment should not be permitted.

“I believe that there is already a way to support the building of a nation of owners.

“The Government can play a pivotal role. This is just not one of them.”

Mr Dickinson has been at odds with the PLP before — most notably in his February 2022 resignation as minister over the tax breaks granted to the developer of the Fairmont Southampton hotel.

In October 2022 Mr Dickinson also launched an unsuccessful challenge for leadership of the party against David Burt, the Premier, at the PLP’s delegates conference.

In speaking against the proposed homeowners refund, Mr Dickinson made reference to his segue into politics in 2018, when Jeff Baron of the OBA resigned from Warwick North East, triggering the by-election in which Mr Dickinson became MP.

In the 2020 General Election, Mr Dickinson took Pembroke South East — a PLP stronghold vacated by former MP Rolfe Commissiong, who opted to step aside.

Today in the House, Mr Dickinson alluded to an exchange he had in 2018 with “a somewhat prominent figure in our community” when the decision was taken that he would run in the Warwick by-election.

He told MPs: “It was thought advisable that my profile be raised in the community, and in that vein, I was scheduled to participate in a forum.

“There was a view expressed that I should take an adversarial approach to discussing Bermuda’s financial services industry.

“I declined to take that approach, and instead offered to speak on the benefits of financial literacy.”

Mr Dickinson added: “I was told that financial literacy never improved anyone’s life.

“That statement was as wrong then as it is wrong now.”

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Homeowners Refund Regulations.pdf

•To see the pensions legislation for first-time homeowners, see Related Media