Bermuda's controversial term limits policy for work permit holders will be suspended for two years or scrapped entirely, Home Affairs Minister Michael Fahy has announced.A final decision is expected before the end of this month.In a nod to the political divide over the issue, Senator Fahy acknowledged that “the mere mention of the words 'term limits' and 'work permits'” tended to result in “a frenzied debate”.The 2001 Progressive Labour Party policy, which imposed a six-year limit on most permits as a means of curbing long term residency, got a largely unfavourable reception from the local business community. Suspending it was a pre-election promise of the One Bermuda Alliance.Seeking to “debunk some myths” about term limits, Sen Fahy insisted it was the Island's work permit policy, rather than limits, that protected local jobs.Term limits were not put in place to allow Bermudian workers to take over from guest workers, he added, but to “prevent the legitimate expectation to residency”.However, said Sen Fahy, the policy “is not necessary” to prevent long term residency claims — and he said that Government had known as far back as 2006 that “the policy has absolutely no legal effect”.Instead, he said, it reduced Bermuda's competitiveness, had “a significant and detrimental effect on business”, and hampered attempts to attract and keep guest workers.Sen Fahy added that of the 6,817 work permits in March, 2011 that were subject to limits, 35 percent got waivers, another 35 percent were granted extensions, and just 30 percent were subject to the six-year cap.“But because the term limit policy requires that a guest worker leave after six years, or make application for an extension, a great deal of uncertainty is created that is entirely detrimental to the business environment,” he said.Shadow Home Affairs Minister Walter Roban was unavailable last night for comment.According to Sen Fahy, the Island was now facing a brain drain, even as statistics failed to show Bermudians taking over jobs when guest workers left.He said the Ministry would hand over its impact assessment on the elimination of term limits to a work permit stakeholder group “within the next day or two”.Asked why he wasn't simply dispensing with term limits immediately, the Minister pointed out that the OBA's promise to suspend term limits had come with the proviso “pending better policy”.“What in fact we discovered is that maybe we should be scrapping them altogether.”Sen Fahy added that he was “not anticipating an inordinate amount of time” for a final decision to be made on whether or not to dispense with the limits entirely.And he also hinted that Government could implement a system that would show “when a work permit is coming up for renewal”.“Woe betide any employer who ignores work permit policy,” he warned.Sen Fahy said he couldn't remember the last time he'd seen an employer prosecuted who breached work permit laws, and that stiffer enforcement was needed.“Government is ever mindful of the legitimate needs and expectations of Bermudians — those who are Bermudian by birth, and those who have already become Bermudian by grant,” he said. “But unless we have a major swelling in birth rates, Bermuda will never supply enough Bermudians to satisfy the job market. In order for Bermuda's economy to thrive, there is a need for guest workers into the foreseeable future.”In the meantime normal work permit policies and procedures continue to apply, he said.Regardless of whether Government suspends the current term limit policy, or eliminates it entirely, work permit holders will be required to sign a declaration confirming they understand that Bermuda law does not confer them rights of permanent residence, and that holders have no expectation of such residence.Sen Fahy also advised guest workers with concerns that their local employers might be breaching the conditions of their employment to contact the Department of Immigration.