Government departments “must move beyond reporting and into action” to recover close to half a billion dollars owed to the public purse, a report from Heather Thomas, the Auditor-General has highlighted.

Effectiveness of the Government of Bermuda Receivables and Debt Management Process shows a total of $481.56 million uncollected as of March 31, 2025, for amounts owed to the Government for “goods or services already delivered and earned”.

The list of departments is topped by the Office of the Tax Commissioner, at $404.2 million.

A further $21.04 million was uncollected by the Department of Works and Engineering. The Registrar of Companies was owed $18.54 million, while the customs department was overdue $6.81 million and the judicial department $5.38 million.

A further $25.59 million was uncollected by the remaining government departments.

The amount has risen substantially over the past several fiscal years. It added up to $457.6 million for the fiscal year ending in 2024, and $405.4 million for 2023.

Seven root causes were identified: weak enforcement, lack of accountability, system limitations, poor data quality and a “cultural tolerance of non-payment”.

The report said that accounting systems used by departments reviewed lacked “adequate receivables management and reporting application”.

On the cultural issue, it said: “Government is engaged in providing public services, not primarily based on people’s capacity or non-capacity to pay. However, there is cost to providing public services.

“Government is effectively financing businesses or individuals by allowing supply of goods and services to continue despite outstanding balances.”

The report also flagged up “silo operation”, meaning a lack of “formal or structured collaboration among the departments to share information to facilitate debt collection”, and “political influence over operational decisions”, in which departments “may receive recommendations from their ministries to defer collection”.

“A growing or ageing receivables balances increases the risk of bad debt,” the report stated.

“Receivables that remain uncollected become bad debts and mean that funds are not being added to the government coffers and therefore not available to finance government initiatives and programmes.”

It said the year-on-year increases could point to systemic issues, such as “outdated systems, insufficient staff for collections, lack of follow-up procedures, current legislative frameworks lack the necessary enforcement powers to effectively pursue the matter or a lack of political will to pursue outstanding debt”.

The issue has been a persistent one, with the House of Assembly hearing in February 2022 that the Government was owed almost $200 million by the end of 2021.

The report by Ms Thomas said “immediate actions” were needed for the judicial department, the Registrar of Companies and the Department of Works and Engineering.

Short-term action was advised for the Office of the Tax Commissioner and long-term actions were advised for the customs department.

Works and engineering was said to have an average receiver turnover of 695 days, while the judicial department had a turnover of 488 days and OTC had a turnover of 183 days. For the ROC, it was 111 days. It was ten days for the customs department.

The report, based on audits from April 2022 to March 2025, was tabled on Friday in the House of Assembly.

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Report on AR Management 2026_ September 25_2026.pdf

• To read the Auditor-General’s report in full, see Related Media