A move to set up a government-backed mortgage lender is a “wantonly unfair” use of public money, the shadow finance minister said yesterday.

Nick Kempe also warned that the Progressive Labour Party’s plan to lend cash to public service employees was “risky”.

Mr Kempe said: “I think it is a terrible idea. Government is starting to enter the loan space with public money? We have seen how they have managed other projects.

“They are not hitting the budgets that they are setting for themselves and now they are going to add a lending layer?

“They are taking taxpayer money and giving a preferred benefit only to government employees — there are a lot of non-government employees that are putting that money in.”

Mr Kempe, the One Bermuda Alliance Senate leader, was speaking after Curtis Dickinson, the finance minister, announced in his Budget Statement that the mortgages would ease pressure on public service staff through reduced rates.

He predicted that Mr Dickinson’s first Budget would increase the cost of living.

Mr Kempe said that plans to increase land taxes would affect more people than the Government’s scrapped rental tax.

He added: “They say on the one hand they will not impose a residential rental tax, but on the other hand say they are increasing land tax — it’s the same thing.

“It’s actually worse because the rental tax, as described in the Tax Commission Report, wasn’t charged to people who lived in their own home, it was only going to be levied on income properties.

“The land tax hits everyone. Everyone will feel this new tax, it hits people in their own home while the rental tax didn’t.”

Mr Kempe said there was nothing in the Budget to bring financial relief to ordinary people.

He added that an increase in foreign currency purchase tax would affect people earning Bermuda dollars.

Mr Kempe said: “If you are working in international business, earning US dollars, you don’t care.

“There is a lot of stuff in here that targets Mr and Mrs Bermuda, while exempting big business and IB.

“They talk about a better and fairer Bermuda but it seems counterproductive.”

Mr Kempe added he had little confidence that the Budget would boost the economy or create jobs.

He said: “There is nothing in here to create new stimuli. The only thing that is buoying the economy right now are a couple of One Bermuda Alliance projects that have a limited lifetime — the airport, St Regis.”

Mr Kempe added: “The inconvenient truth is that our working population is down from its height in 2008. We need to be more welcoming.

“We in the OBA are more plural in our nature and that is a major difference in our approach to immigration.”