Government will not abandon the furlough option for civil service workers as a prerequisite for continuing negotiations with unions, Premier Michael Dunkley said yesterday.

This came despite union representatives refusing to continue with negotiations until the threat of further furloughs was suspended.

As protesters drummed and chanted outside the Cabinet building, Mr Dunkley said that rescinding the savings measure was “not possible at this point”, while Finance Minister Bob Richards maintained that furloughs had saved public sector jobs.

Mr Richards called on the Island to accept that “we are still in the hole — we just have to face reality here”.

Flanked by Cabinet members at an impromptu press conference held in the Senate chamber, Mr Dunkley gave a drastic picture of the Island’s debt expenses: “almost $120 million a year” is being spent for the deficit, covering debt and meeting payments on loans.

“This year, it is anticipated that the Government budget will lose $270 million,” he added, repeatedly saying that the Island was spending much more than it took in.

Mr Dunkley had apologised earlier in the day after Government’s representatives missed a fresh meeting of the working group formed with the Bermuda Trade Union Congress (BTUC) to examine cost saving measures.

The Premier said he could not have sent people endorse agreements unless he could be sure that Cabinet had already agreed with the proposals. The emergency Cabinet meeting on Monday night lasted four hours. Mr Dunkley laid out options for cutting costs, which the working group was convened to examine after BTUC called on the Government to collaborate.

“From the outset, the terms of reference were very clear to the working group, and we had to recognise that the furlough day contribution would be on the table,” he said.

“The BTUC refused to acknowledge and debate that issue. They put it aside. The minutes show that.”

He said Bermuda Public Services Union president Jason Hayward was “not being straight” when he suggested that furloughs had not come up in the talks.

“It was discussed early,” the Premier said. “They refused to discuss it further.”

The working group came up with “realistic savings” of $37 million, Mr Dunkley said, disagreeing with the BTUC’s assertion that they had in fact found up to $85 million in potential savings.

“It just didn’t add up that way,” he said, adding that several proposals had been factored into the upcoming 2015/16 Budget.

But last night Mr Hayward accused the Premier of calling his integrity into question.

He provided this newspaper with the BPSU’s “2014 Deficit Reduction Proposal” which outlined a raft of ideas including removing non-essential overseas travel, relocating Government offices to Government buildings, a 20 per cent reduction in office materials and supplies and using prisoners for Government maintenance and landscaping.

Mr Hayward also provided a copy of the Draft Budget Reduction Proposal 2015/16 which states: “Both the BPSU and the BIU submitted formal proposals for the Working Group’s consideration. The estimated savings were between $67 million and $80 million.”

Mr Hayward told The Royal Gazette: “It is important for the facts to get out and that we have supporting documents that back up what we are saying. It is unfortunate that the Government officials will make statements to mislead the public.”

The unions have agreed to examine reducing overtime from double to straight time, or time and a quarter. A freeze on hiring has been agreed, and Government posts that become vacant will only be filled if deemed essential. Government will also offer an early retirement programme.

“We have some proposals to put to the union that we think can offer significant savings. However, none of these decisions are easy. They all are very difficult to make. We are willing to work on those with the BTUC if they are willing to come back to the table and contribute. Until we have this opportunity, we really can’t go any further.”

The Premier said that he understood “where the union is coming from”, but added: “I am not willing to jeopardise the future of current Bermudians and future Bermudians.”

Mr Dunkley also gave his backing to letter sent on Friday to the BTUC by Mr Richards, in which the Finance Minister set a deadline of noon on Monday for a decision on the future of furloughs, which are set to expire on March 31. Union leaders branded the letter disrespectful, but Mr Dunkley said it was acceptable, adding: “Everyone has their own personality. The Minister of Finance, who has my greatest respect, is very direct in how he communicates.”

Mr Richards stood by the letter as well, saying Government was legally obliged to bring a Budget before Parliament to be authorised.

“The legal option for us to spend money and tax money runs out on March 31,” he said, adding: “There was no threat. It’s reality. It’s the law. The law requires us to do it. If someone wants to interpret the latter I sent as threatening, they don’t understand the system.”

Mr Richards described the Budget, due on February 20, as “a tough Budget for everybody”.

“What is particularly upsetting is that we have people who are opposed to the very policy that has saved their jobs,” Mr Richards said. “The furlough has saved civil servants’ jobs.”

All of the Islands’ thousands now unemployed are from the private sector, the Minister said, adding: “There is not one person unemployed in this Island because Government laid them off.”