There is no need to cut Government spending following the terrorist attack on the United States as the Government is in a strong financial position, Acting Premier Eugene Cox said yesterday.

Mr. Cox said there would be no cuts in capital project spending or Government spending, but emphasised that losses in tax revenues from fewer tourists could be met by reserves in the Budget.

He said it was important to keep Bermudians in jobs to make sure they could put food on the family's table, so no capital expenditure would be cut.

Mr. Cox anticipated some weakness in tourism-related revenue such as passenger tax, hotel occupancy tax and payroll tax "as the result of the weakened hotel restaurant and retail sectors".

But he said that this would be absorbed by a cash surplus in the Budget for this year, and no cuts would have to be made in spending.

He said: "It is too early to quantify, but revenues and expenditures are being closely monitored on a monthly cycle. Government has positioned itself to assess and realign priorities within its existing budget in order to better accommodate any unplanned expenditure arising from the tragedy."

Asked if there would be any cuts in spending he said: "What you are saying is take action today, take action today, formulate a plan today for a period when we don't even have facts and figures to verify that those conditions exist. That's why I said let's wait and see. Those are the things we can do in the meantime."

On the subject of Cabinet and Government travel, Mr. Cox said: "We are a responsible Government and we are doing all the things we can do now. We only take travel trips when it is necessary, most of us in fact go on trips for the Government when we have to, in some cases we can't and you don't go, but most of the time when you see us get on a plane for Government business, we are going because we need to go."

He was then asked: "So there is no cut in expenditure at the moment?" He replied: "I think I just described to you two circumstances, the present circumstances which does not warrant such action and I said if and when such action comes when we need to do it we will do it. That is the worst case scenario but at this point in time there is no need to go to that worst case scenario. I hope you write that the way I said that. I think I see you going somewhere where you want to be, not where I want to be."

When asked after reading his statement whether Government was to cut spending he said: "Madam, I would like to think that the question of how we deal with our people, certainly because we came into this financial year with a good cash surplus, I would like to think that the question of what we do certainly in terms of jobs for our workers, I would like to think that we are going to do all in our power, using some of that surplus to minimise the impact of any deficiency in revenue."

Mr. Cox said that it appeared that the Island would have no difficulties shipping imports to the Island and Government intended to continue with capital projects to ensure that people kept their jobs.

He also urged hotels not to lay-off staff, but to tell them: "Yes, look we won't be able to give you a valet's or a waiter's job to do, because we don't have a choice, but certainly you can have this paint job if you so wish, or clean some windows and other things that need to be done.

"And I think that if businesses and employers make that kind of effort we will keep our people employed for the longest possible level and I think that would be good for Bermuda. And your idea of cutting expenditure, to my mind, I think that is a long way down the road, if we continue as we are going now, if things continue to be in such a way. But we get the supplies, we have the manpower to do the job, we have the money there to do it and so on. We would certainly like to pursue it so we can keep our people happy."