Live updates: Budget Day 2021
The Royal Gazette offers a Budget overview with the highlights to take away in the wake of an unprecedented year – with “recovery” the key word for the year ahead. You can find the full article here.
We have posted the YouTube video of the Speech, but the quality is disappointing. You can hear the audio here.
11.16am: David Burt, the Premier, has adjourned the House until 10am next Friday.
11.15am: Curtis Dickinson is wrapping up the Budget for the coming fiscal year, emphasising diversity and innovation.
The island welcomed 400 new people courtesy of the one-year residential certificate in the past year.
“Their arrival strengthens us, and diversifies our community and our economy to the benefit of all.”
The finance minister called on the island not to fear change.
He added: “If you do fear change, face that fear, have courage, and press on.”
11.10am: The capital plan for 2021-22 is $92.9 million.
The Government has once again pledged the development of a shoreside facility for a fishing co-operative.
There will be “desperately needed” upgrades to the Mid-Atlantic Wellness Institute.
There will also be upgrades to the Marine & Ports workshop, and the Department of Public Transportation headquarters.
11.08am: Mr Dickinson said that a surplus budget, starting in 2023-24, will allow Bermuda to continue with its pre-pandemic debt management – a stark indicator of the toll inflicted by the pandemic.
11.06am: The finance minister will defund “any vacant post” unless funding has already been allocated, which will reap savings to the public purse of about $20 million.
11.04am: The Government will chop spending across all ministries by 5.1 per cent, with lower spending on Covid-19 in the year ahead as the vaccine against the coronavirus is rolled out.
11.02am: An “increase within the fee structure” is coming for the Registrar of Companies, but there are “no other meaningful increases to the cost of Government or other fees and taxes”.
11am: The Government isn’t planning on borrowing to finance this year’s deficit, the finance minister said. It will dip into some of the funds currently sitting in the Sinking Fund.
10.58am: The 2021-22 Budget allocates $1.1 billion in total spending, a drop of $18.6 million over the 2020-21 original estimates. Revenues are predicted to slide by 11 per cent, or $123.3 million.
10.53am: Debt service costs for 2020-21 will loom at $128.8 million, which is $7.4 million above what was estimated a year ago.
10.52am: The Government is forecast to earn $960.6 million in revenue for 2020-21, which is a drop of $161.6 million less than what was originally estimated. The pandemic is the top offender. Expenditure for 2020-21 is projected to be $1 billion, which is $71.6 million higher than what was budgeted.
10.50am: Anthony Manders, the financial secretary who died in January, was “a colleague and a friend who possessed unparalleled knowledge about the workings of the Government, and will be missed by all who knew him”, the finance minister said, paying tribute to Mr Manders’ wife, Teresa, and his sons Jekon, Jaiden and Jamori.
10.47am: The finance minister said a $10 million guarantee would back the building of “a branded tourism property” ideally situated on the South Shore at the site of the former Grand Atlantic.
10.44am: The livestream video is poor, and we apologise – to listen, click here.
10.41am: The Budget comes with a promise of infrastructure investment, expanding the population and the introduction of affordable universal healthcare.
10.40am: Bermuda will return to a balanced budget in three fiscal years once tourism has recovered – and the island will maintain the current ceiling on total government debts.
10.37am: After opening the Budget with a review of the past year’s challenges, Mr Dickinson said the economic recovery plan for Bermuda was “underpinned by a set of guard rails, key financial metrics, and ratios that are closely monitored by rating agencies and global agencies”.
Mr Dickinson said the Government would “stay within these guard rails” with a disciplined approach to spending on “targeted initiatives with the highest expected economic impact”.
10.35am: The impact of the failed development at Caroline Bay has been “severe”: close to $200 million of public funds got “unnecessarily tied up and at risk”, the finance minister said.
10.31: “Many people may need to transition to new jobs in the post Covid-19 environment as companies review strategies to accelerate automation, increase their technology use, and reduce their physical footprint.”
Mr Dickinson included the ability of companies to “quickly move resources anywhere in the world” among risks on the horizon to Bermuda.
10.30am: The House of Assembly heard of unemployment benefits, payroll tax relief and funding from the Bermuda Economic Development Corporation to combat the impact of the pandemic on Bermuda’s economy last year.
But the finance minister warned of “serious challenges” including $3 billion in net debt.
Mr Dickinson said that “increased spending resulting from the pandemic and funding economic recovery is driving further near-term deficits and increased pressure on public finances”.
10.25am: GDP tumbled by an average of 8.1 per cent in the first quarter of 2020, while visitor and air arrivals plunged by “historic proportions” in 2020.
But the international business sector, and insurance in particular, remained resilient.
The finance minister said that over the first nine months of 2020, the foreign exchange earnings of the international companies increased by $16.7 million to $1.58 billion – a growth of 1.1. per cent.
10.23am: The financial crisis of 2009 took about 6,000 jobs from Bermuda’s shores, and the island was unable to recover fully before the coronavirus pandemic hit, Mr Dickinson said.
The hospitality industry “received a shock like no other” with the onset of Covid-19.
10.20am: The International Monetary Fund’s forecast for 2021 includes a call for governments to cut deficits and concentrate their resources on stimulating economic recovery and employment, Mr Dickinson said.
He added that many countries “are viewing the pandemic as a once-in-a-generation opportunity to address diversity and inclusion, improve access to and participation in the economy, enact fiscal reform, and focus on climate change”.
10.10am: The 2021-22 Budget opened with a reminder of the $56 million paid out to more than 10,000 workers left jobless by the coronavirus pandemic, which reached Bermuda last March at an unprecedented toll to the economy.
Curtis Dickinson, the Minister of Finance, said the island was “not looking backwards seeking to rebuild our economy to its pre-pandemic state”.
Instead, the revenue and expenditure estimates for the fiscal year ahead will be aimed at supporting Bermuda’s economic recovery.
Mr Dickinson acknowledged the presence at the reading of the family of the late Anthony Manders, the financial secretary, who died in January.
It’s Budget Day in Bermuda and The Royal Gazette will be bringing you online coverage throughout the day along with a full round-up in tomorrow’s newspaper.
We will be streaming Curtis Dickinson’s delivery of the Budget Statement – which will be delivered remotely because of the Covid-19 pandemic – from just after 10am and bringing you live updates here as well.
Mr Dickinson has already signalled that there were will be no new taxes or increases to existing taxes and last night the Premier revealed that public sector workers will not be asked to extend their benefits reduction.
The Chamber of Commerce and charities also released a wish list here.
How many wishes will come true when revenues are short and demands on government are long will be known when Mr Dickinson takes to the podium.
The Royal Gazette’s opinion and columnist John Barritt are both weighing in with their views, with the View from Off the Hill calling for less point scoring and more constructive solutions in the Budget Debate which will start next week.
If you want more background, see Mr Dickinson’s roll-out of the Pre-Budget Report and the Fiscal Responsibility Panel’s report in January here.
He indicated then that early retirements for civil servants may be on the cards.
Cole Simons, the Opposition Leader,. will give his first reaction this at 2.45pm. He set out his stall here.