Still time to choose our fiscal fate

  • Charting a path: three different debt-to-revenue trajectories for Bermuda (Graph from the Fiscal Responsibility Panel’s 2018 report)

    Charting a path: three different debt-to-revenue trajectories for Bermuda (Graph from the Fiscal Responsibility Panel’s 2018 report)


The Fiscal Responsibility Panel report reviewed the evolution of the all-important debt/revenue ratio under different scenarios — and also included a projection based on the recommendations of the Tax Reform Commission being implemented by Government.

The panel’s “base case” is consistent with the 2018 Budget, the panel wrote. “Under this scenario, the debt/revenue ratio falls at an accelerating pace, and hits the government target of 80 per cent by 2028-29, by which time the debt/GDP ratio has been reduced to 17 per cent, less than half the current level.” The panel also reviewed a “slowdown and interest rate shock” scenario. “Under this scenario, both the debt/GDP ratio and the debt/revenue ratio remain broadly flat; the debt/revenue ratio remains very high for the foreseeable future and is still close to 200 per cent in 2030. It should be noted that we do not attempt to model the worst-case scenario of a complete loss of market access (a ‘sudden stop’); in such an event, emergency fiscal measures would be necessary.”

Finally, the panel modelled the successful and timely implementation of the proposals of the TRC, which would result in a sharp rise in revenues in 2019-20 (more than 10 per cent). “This generates very positive and self-reinforcing fiscal dynamics, as interest rates also fall,” the panel wrote.

You must be registered or signed-in to post comment or to vote.

Published Jan 30, 2019 at 8:00 am (Updated Jan 29, 2019 at 5:04 pm)

Still time to choose our fiscal fate

What you
Need to
Know
1. For a smooth experience with our commenting system we recommend that you use Internet Explorer 10 or higher, Firefox or Chrome Browsers. Additionally please clear both your browser's cache and cookies - How do I clear my cache and cookies?
2. Please respect the use of this community forum and its users.
3. Any poster that insults, threatens or verbally abuses another member, uses defamatory language, or deliberately disrupts discussions will be banned.
4. Users who violate the Terms of Service or any commenting rules will be banned.
5. Please stay on topic. "Trolling" to incite emotional responses and disrupt conversations will be deleted.
6. To understand further what is and isn't allowed and the actions we may take, please read our Terms of Service
7. To report breaches of the Terms of Service use the flag icon

  • Take Our Poll

    • "Confidence that Bermuda will be removed from the EU blacklist after May 17 meetings?"
    • Confident
    • 35%
    • Not confident
    • 56%
    • Indifferent
    • 9%
    • Total Votes: 3167
    • Poll Archive

    Today's Obituaries

    eMoo Posts