Budget ‘a bridge to nowhere’, says OBA
The Budget crafted by Premier and Finance Minister Paula Cox is a “bridge to nowhere”, according to the One Bermuda Alliance.
The financial plan will not put Bermuda back on the path to economic recovery or generate significant amount of jobs and it puts “political needs before the needs of the Country”, the party claimed yesterday.
“Only through growth can we create new streams of income to support families, broaden opportunity, sustain local businesses and start moving the Island back from the edge of a debt problem that threatens to cripple the future,” Shadow Finance Minister Bob Richards said in a statement yesterday.
“The Budget, in short, needed to present a plan to get the Island on the road to recovery. It did not. Instead, it adds tens of millions of dollars to our debt burden.
“It raids worker pensions and debt-clearance funds to cover shortfalls.
“For the fifth year in a row, it spends more than it earns, continuing us on a path that takes us closer to meltdown.”
He added: “This is a Budget that avoids the hard decisions. This is a Budget that puts the political needs of the Government before the needs of the Country.”
Mr Richards had earlier questioned whether the Budget revenue and expenditure estimates could be relied upon, given that they have been consistently inaccurate over the last few years.
“They’ve always come out on the wrong foot over the last several years. So it’s a big problem,” he said.
Kim Swan, who was elected as a United Bermuda Party MP, shared that sentiment.
He noted that the current account deficit for 2012/13 is estimated at just over $124 million
But he pointed out that Government’s revised revenue projections for 2011/12 are $70 million lower than its original estimates and its expenditure was underestimated by $69 million.
“The net effect is the budget differential (or deficit) is $139 million out of line because Government underperformed in raising revenue and continued to overspend with its expenditure budgets. This trend has been repeated over a series of previous years, and must stop,” he said.
Added Mr Richards: “I don’t know what credibility people can put to these estimates of revenues or expenses.”
Mr Richards said he could see little in the Budget in the way of a plan.
“There are a lot of platitudes to a lot of things. But no plan to change the major issues of this Island,” he said.
“We’ve been given no plan, no hope to turn around our international business, to turn around tourism. All of a sudden they realise they have to try to save money and be efficient but any government should have known that from the beginning of time. So there’s not much in here except a bit of a folksy story.”
He continued: “There’s nothing in here that talks about what they’re going to do about the Immigration problem, the term limit problem, nothing in here about healthcare costs. Those are the real issues that we have to tackle. I don’t know what kind of leadership this is, if they don’t tackle the issues. The serious issues that we are facing in this Country have not been addressed in this Budget.”
Asked if there was anything in the Budget Statement that did impress him, he said: “I’ll read it again to see if I can find that.”
One Bermuda Alliance Leader, Craig Cannonier, questioned whether the budget reflected present day realities.
“What Bermuda needs to ask initially with this budget is ‘does this put more food on the table?’, ‘is it going to better educate our children?’ and ‘is it going to create more jobs for Bermudians?’
“I don’t know if this budget is going to meet the reality of the people of this Country. And that’s where we need to hone in on, these numbers, and get down to the nitty gritty.”
Mr Swan said that the Budget statement “struck a good tone which parallels the mood in Bermuda”.
But he added: “In scrutinising revenue and expenditure the necessity to practise disciplined spending in Bermuda has not been taken up by the PLP Government.
“We anticipated that the Government borrowing would continue but we respectfully feel that the Government is placed under great strain having to project a current account loss for yet another year.
“We note that current account expenditure of $1.005 billion does not reflect any percentage savings over the original Budget of the previous year, but we are thankful that the projections are close to the previous year.”
Still, Mr Swan said, the Premier had come up with a “reasonable budget against the challenge of diminished reserves and with the assistance of continued borrowing”.
However he criticised Government for having “missed an opportunity to challenge itself to function leaner” by not moving to ensure that spending came in below projected revenue.