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Opposition MP: an economic war is coming

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Craig Cannonier warns of the coming economic war

Parliament was warned of an impending economic war, with recent moves by domestic insurers frowned upon as they positioned themselves for an evolving market.

The Government was urged to view the planned merger of Argus and BF&M as a need to scrutinise what was going on in the economy.

Craig Cannonier, an opposition MP, businessman and former premier, told the House of Assembly of cracks in Bermuda’s economy with the taxpayer being forced to foot the bill.

His comments were broadly accepted during the motion to adjourn, with government MP Zane DeSilva remarking that among his own companies, healthcare costs had risen by as much as 20 per cent.

When later approached by The Royal Gazette, Mr Cannonier said that Bermuda’s domestic insurers were taking actions that had exposed the lack of stability in the economy.

CG Insurance was one of the Bermuda insurers mentioned during the House of Assembly (Photograph by David Fox)

He said: “I can’t blame CG, Argus, BF&M. These are companies looking to survive, to protect their interests. That’s what businesses do.

“But as a result of this economy, the taxpayer of Bermuda is getting hammered.”

Mr Cannonier said: “The [international] insurance world is fine, but the local economy is struggling.”

He said when that was combined with the mass emigration of recent years, “you have a recipe for monopolies”.

“I don’t know all that is behind the merger [of Argus and BF&M], but if you have CG licensed to go into the pharmaceutical industry and Argus gobbling up doctors’ offices, we have to look at this more closely.

“If a doctor can’t own a pharmacy, why are we allowing insurance companies to own pharmacies? It’s a conflict of interest. And here is a classic example.

“Generic drugs were always 100 per cent covered [by insurance companies], no matter what pharmacy you went to.

“But now CG, since it has started its own pharmacy, is saying that if you don’t get your generics from us, we’re only going to cover 80 per cent.

“That’s wrong. That is completely wrong.“

Mr Cannonier, whose wife is a pharmacist, declared his interests, having himself been the long-term manager of a local pharmacy.

He said: “The cost of private insurance has gone up, in some cases more than 20 per cent.

“But then the Government taxes you more to subsidise their own insurance programmes [HIP, Future Care and the Government Employee Health Insurance].

“The premiums the Government take in do not cover their costs. So taxpayers are subsidising these government programmes and therefore are getting hit twice over health insurance.

“The Government is going in debt to help people, but the private insurance companies just raise rates.”

Mr Cannonier said it was a dire situation and, without checks and balances, Bermuda would never keep a lid on costs.

He added: “This is why the insurance companies are merging. They are realising they need to protect themselves.

“And what comes with these mergers? Redundancies. People are going to lose their jobs because we have a failing economy.

“This is all about the economy. There is an economic war coming. I’m looking at this from a business point of view.

“How is the business owner impacted by this? He recognises that he will be forced to pay more. The cost of running a business in Bermuda is going up; electricity, you name it. It has become a war of survival.

“The Government is not empowering the economy to help avoid these survival mechanisms. Companies will only do what they feel they have to do to survive.”

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Published July 05, 2024 at 7:59 am (Updated July 05, 2024 at 7:28 am)

Opposition MP: an economic war is coming

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