Auditor General Larry Dennis' annual naming and shaming of companies who fail to pay taxes and pension contributions is becoming as much a ritual of early summer as the Queen's Birthday Parade.

The exception was last year when the calling of the General Election delayed the release of the report until November.

At that time, a Royal Gazette editorial said employers who failed to pay their taxes and benefits should be ruled as unfit to run a company and should be barred from any such role until they made good on the arrears.

The editorial added that 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 onto cash to stay afloat.

"That most of the businesses ultimately fail is one thing," it said. "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."

A year later, the situation has only grown worse.

For 2002, the total arrears (for payments which were over three months late) was $22 million. That's a lot of houses, given the Island's current crisis.

But for 2003, the total arrears were $31 million, a 40 percent increase in just 12 months.

Last year, this editorial said that was unacceptable. Now it's reprehensible.

And while much as the blame lies with the individual employers, Government must be held accountable for its slackness in failing to chase up these employers.

It begs the question of what exactly has been going on in the Ministry of Finance.

In his report, Mr. Dennis repeated his opinion of the previous year virtually word for word: "These deficiencies and attitudes have already bred a culture in Bermuda wherein businesses and others view the payment of amounts owing to Government as optional, avoidable or evadable."

He is right. Sadly, that same attitude is prevalent throughout society. People don't pay fines or parking tickets because they know they will not be pursued. The Police don't even bother to issue tickets for people who fail to wear seatbelts.

The list goes on and on. And the Government, ultimately, is at fault because it fails to enforce the very laws that it enacts.

In the seven months since Mr. Dennis issued his 2002 Audit, it would appear that no one has been prosecuted for failing to pay arrears in taxes or pensions.

In certain cases, notably contractor Pro-Active Construction which is being paid millions of dollars for the Berkeley project, it is mind-boggling that it is failing to pay its taxes.

Nor has the ludicrously weak punishment for failing to pay been changed. The punishment for failing to make pension payments is six months in prison or a $250 fine. That has not been changed since 1970. It was not a vast amount of money then. Now it is an invitation to steal.

Some Government departments have agreed with recommendations to prosecute, to charge interest on arrears and to amend the laws. At first glance that is encouraging. But in many cases these are the same promises that have been made since 2001. In the meantime, the arrears keep on growing.

Last year, The Royal Gazette editorial noted that the late newspaper magnate Robert Maxwell was once famously described as "unfit to run a public company" by British Government regulators.

The editorial added that the same should be said about those who renege on their responsibilities to their employees and that they should be banned from owning limited liability companies until they have made good their debts.

But the question must now be asked: Given the growing arrears and the seeming unwillingness to act, is the Government fit to run public finances?