Auditor General Larry Dennis' warning about companies who fail to pay taxes and pension contributions is well taken.

These companies, some of them in receivership, collectively owe more than $22 million in payroll tax, land tax and pension contributions.

While there may be extenuating circumstances in a number of cases, the vast bulk of these arrears occur when a company begins to fall into financial difficulties. Then tax payments and the like are the first bills that do not get paid as the business owners try to hold into cash to stay afloat.

That most of the businesses ultimately fail is one thing. But in the case of pension contributions, the businesses are stealing from their employees; the money did not belong to them in the first place.

To add insult to injury, the employees will not only lose their jobs when the company fails, but their retirements are endangered as well.

And when taxes are not being paid, the burden will eventually fall on the honest taxpayers who will be required to make up the difference.

This is unacceptable. Twenty-two million dollars is a large amount of money by any measure. It could build a lot of houses, buy two or three fast ferries, help a lot of pensioners or put a dent in the public debt.

For some reason, Government seems to be unwilling to prosecute these tax evaders, either civilly or in the criminal courts.

Auditor General Larry Dennis rightly says in his report: "I am concerned that these deficiencies have already bred a culture in Bermuda wherein businesses and others view the payment of amounts owing to Government as optional, avoidable or evadable.

"When past due debts reach their present magnitude, they are a drain on Government cash flows, they increase borrowing costs and the risk of lost revenues and, in the case of pension contributions, they diminish workers' pension benefits.

"When employers fail to remit pension contributions they have collected from their employees, they betray their employees' trust and cheat them of the pensions for which they have paid."

He is right and he is doing what he can to end the practice by "naming and shaming" the companies that are in serious arrears. To some extent, the policy is working. A number of businesses that were shamed a year ago are no longer on the list.

But too many businesses still are and there is no shortage of new members of this dubious club.

The Government cannot allow businesses to get one or more years in serious arrears without acting. These companies have commitments that they must be made to meet, either by being sued in the civil courts, or by facing criminal action.

And when they do appear in court, they need to be dealt with severely. The punishment for failing to make pension payments is six months in prison or a $250 fine. Neither has been changed since 1970 and it is ludicrous that someone who has failed to pay their employees' pensions, sometimes to the tune of hundreds of thousands of dollars, can get away with a $250 fine. That isn't a deterrent, it's an invitation to break the law.

What's worse, as noted in the Auditor General's report is the fact that some business owners have gone heavily into arrears, out their companies into bankruptcy and then started up a new business under a new name without being liable for a penny of their debts, tax arrears or pension contributions.

The late newspaper publisher Robert Maxwell was once famously described as "unfit to run a public company" by British Government regulators. The same should be said about those who renege on their responsibilities to their employees. They should be banned from owning limited liability companies until they have made good their debts.