The comment was "ludicrous'', said Labour and Home Affairs Minister the Hon.

Irving Pearman.

It looked back to the Bermuda of the 1950s and 60s, he suggested.

The Minister was responding to Mr. Roger Davidson, president of H.A.& E.

Smith, who said at a Chamber of Commerce meeting that local merchants had "no pool of capable labour to draw on''.

Mr. Davidson said stores might not be suffering their present cash crisis if they had the same freedom to hire "competent outsiders'' as other firms.

He contrasted local shops with their North American rivals, which he said benefited from a pool of young, well-educated workers willing to take near-minimum wages.

Finance Minister the Hon. David Saul has already expressed surprise at Mr.

Davidson's demands for more Government action to help stores suffering losses.

Yesterday Mr. Pearman said he, too, was surprised by the merchant's comments.

"Like Finance, the Ministry of Labour and Home Affairs has a mechanism for joint consultation with the Chamber of Commerce, and the ideas which Mr.

Davidson apparently propounded have not been brought up -- at least not in recent years.

"I do not feel it would be in Bermuda's best interests if we were to roll back policies and procedures which have existed for years, and which have played a vital role in building the Bermuda of the 1990s.

"We are agreed in this community that Bermudianisation is necessary, desirable and -- perhaps most important -- corrrect from a moral standpoint.

"To start making exceptions now, on the basis that to do so would help one section of the business community, would amount to rolling back the progress we have made since the 1950s and 1960s.

"At the heart of our immigration policies is the principle that if a Bermudian is available who is able and trained to do a job, then a non-Bermudian should not be brought into the Island.'' Me. Pearman said he believed the vast majority of Bermudians, employers or not, believed in that principle, "even though it is sometimes inconvenient for them''.

"To that vast majority of Bermudians, it is simply ludicrous to suggest that that principle should be swept away so that some employers could have the freedom to employ cheap labour from abroad,'' he said.

"I know retailers feel that they have had a bad year. I sympathise with them.

But they will have to look somewhere other than the Ministry of Labour and Immigration for the answers to their profitability problems.''