House yesterday.

Government will now be allowed to write off sums owed of more than $600 which will mean official accounts will not be distorted by long-term debts which are unlikely to be recovered.

Independent Senator Walwyn Hughes supported the bill, but added a close eye needed to be kept on cash owed Government.

And he said he was worried by the 54 percent rise in money owed to the Government in the last four financial years.

He said: "There was $37.7 (million) owed in 1995 but $57.8 (million) in 1998.

That's a big jump.'' He explained a large chunk of this was tax which is carried forward to the next year before being collected. But other owed money, such as fines and fees, was a concern.

And he said there was a need to keep tabs on what was written off above a certain level now that the $600 limit had gone.

Sen. Hughes also expressed concern for the $218 million liability in the Superannuation fund - he said money being paid in now does not match cash that would have to be paid out if everyone lived to retirement age.

Senators also passed amendments to the Companies Act -- which brings Bermuda law more into line with the world.

Shareholders will now not be restricted to redeeming their stake in cash and can choose another form of payment.

Senators also abolished the rule requiring someone who bought shares after being misled having to rescind the contract of purchase before legal action.

Companies will now not be restricted to appointing their directors at their firm's Annual General Meeting and mutual companies will have more freedom to merge.

And a corporation which holds shares as a nominee would be able to appoint multiple representatives to separately vote the shares of each person for whom the nominee acts.

"Grey water'' is to come to the aid of drought-hit Bermuda, Senators revealed yesterday.

Milton Scott , the Government's leader in the Upper House, admitted there was a water crisis and said schemes to recycle sewage water and other already-used sources were planned.

The recycled water, known as grey water, would be used for irrigation leaving purer water for household use.