Dear Mr Editor,

There are some in this country that would like for us to resign ourselves to the fact that there are rich and there are poor and, because of our current fiscal position, the Government is unable to address the alarming trend of the rich are getting richer and the poor are getting poorer.

Mr Editor, our Government must look at measures that seek to reduce the income inequality in this country and they must do it boldly.

The IMF has called on world leaders to take steps to reduce income inequalities, as it believes that these inequities are a direct threat to economic growth. The IMF concluded that income inequality can be addressed by helping the poor and the middle class through fiscal policy.

An IMF policy paper titled Fiscal Policy and Income Inequality identified key fiscal policy measures that can help to achieve a more efficient redistribution through both social spending and fair taxation.

The social spending initiatives that were highlighted by this report included:

• Improve fiscal sustainability of existing pension system through increasing statutory retirement ages

• Intensify the use of active labour market programmes and in-work benefits for social benefit recipients

• Increase private financing of tertiary education

• Maintain access of low-income groups to essential services

The taxation initiatives that were highlighted included:

• Implement progressive personal income tax rate structures

• Relieve low-wage earners from tax or social contributions

• Tax different types of capital income in a neutral manner

• Develop more effective taxation of multinationals

• Automatically exchange information internationally

The IMF is not alone in this view as the Organisation of Economic Co-operation and Development released a report in 2014 that concluded similar.

While it is becoming evidently clear to the rest of the world that both trickle-down economics and austerity measures are failing, our government continues to base its economic recovery plan on this disastrous approach.

While we are told repeatedly by our government that things are improving, the reality is there has been no significant growth in our economy and the job market. This was highlighted in the recently released 2015 Job Market Employment Brief, which revealed that the job market continued its downward trend in 2014, with more than 800 jobs being lost for this period.

This report also showed the stark contrasts in median gross annual incomes between the various demographics within our labour market. While the median annual income for Bermuda’s total workforce was reported to be $63,897, Bermudians’ median annual income was pegged at $59,357 and for non-Bermudians it was $85,016. Our country’s continuing race-based inequities were also highlighted with the median annual income for Blacks at $57,877 and, in contrast, for Whites it was $87,799.

We cannot sit back and allow the middle class to continue to erode, as failure to act will have long-term ramifications that will be detrimental to future generations of Bermudians.

We can have an efficient system where the rich continue to thrive without making the poor worse off, but, for this to occur, we need a government that is prepared to implement policies and legislation that directly address these inequities.

We are running out of time; the time to act is now.

Regards,

JASON P HAYWARD