Have Bermudians been left holding the bag?
Last Friday the Progressive Labour Party government failed the people of Bermuda with yet another demonstration of its lack of accountability, lack of forthrightness and lack of ability. The Fairmont Southampton concession Bill is an historic giveaway to the developer that shows that David Burt as finance minister allowed himself to be out-negotiated and pressured into caving. You might even say Mr Burt blinked.
Think of Bermuda as a family who are going through some tight times financially. The car has broken down and needs to be fixed or replaced so everyone can get to school and work. The head of the household has been sent down to the car dealership to see what can be done — but with a tight budget. They come back with the latest set of wheels, 50 per cent over budget, and with a verbal “promise” for free rustproofing in five years. And Cousin, a financial adviser, is shaking her head.
So when the One Bermuda Alliance says it supports the need for concessions for the hotel, but not for 15 years, we are telling Mr Burt to take that deal back — and come back with one Bermudians can afford.
Tourism minister Vance Campbell said that “discussions are at a technical and advanced stage” — in that case, why not wait a short while so Bermudians can understand what they have been signed up for? Why keep us in the dark? Given that Curtis Dickinson, the PLP MP with the most financial experience and expertise, resigned his position because of this bad deal, why do the other PLP MPs think they know better? Pure arrogance and steamrollering by Mr Burt.
Much was said by the PLP about the “ownership society” and “profit sharing”. But you know where it doesn’t say that? In the Bill that was passed on Friday. Instead, we have empty promises from the same David Burt, the Premier, who gave almost $1 million to a con artist, and $3.6 million in a no-bid contract to his fintech adviser.
We were shown an out-of-date “letter of intent” that expired in 2020, that gives only ten years of concessions and a $50 million guarantee. Since then, it is clear that the developer has managed to pressure David Burt to its advantage, with an unprecedented extra five years of concessions and $25 million more in guarantee.
Speaking about ownership, did you know that the Bermudians will have three times as much at stake in this hotel as the developer? About $300 million in guarantees and giveaways versus $75 million in investment from the developer. We should have leveraged that the developer has already sunk money into buying this hotel, and has a lot of stake in successfully completing this deal. It needs a deal to work just as badly as we do.
If Mr Burt and the PLP government are serious about an ownership society, they should start with these four items:
1, Reduce government expenses and complete tax reform. Then Bermuda can start digging out of the massive debt hole created by successive PLP governments, which is a burden on all of Bermuda’s future owners and taxpayers
2, Find creative ways to help small businesses and retailers, or those who have invested in homes to create Airbnbs. These Bermudians, who employ many people, and pay for services, are handicapped by taxes, import duties and an unresponsive government bureaucracy. For example, let importers defer duty payments until they sell their goods or find ways to open the existing condo market to overseas buyers, instead of giving overseas developers land tax and duty breaks to build condos with the hotel
3, Fix education to give our future generations the tools that they need to succeed, which would enable them to can put their creativity and skills to good use, and take pride in their accomplishments as they build the ownership society
4, Importantly, shore up the social safety net so those of us who need help can get it
But instead, David Burt and the PLP government have been sweet-talked by the developer, and once again, the PLP has left Bermudians holding the bag.
• Douglas DeCouto, PhD is an opposition senator and the approved candidate for the One Bermuda Alliance in Warwick North East (Constituency 25)