Businesses are considering exiting Bermuda because of the work permit term limit policy, according to businessman and former politician Quniton Edness.

And he compared the policy to one put in place by the Bahamas in the 1970s - which resulted in its insurance industry leaving the Caribbean island.

Mr. Edness said he was not sure that the Government understood the full force of the discontent in the business community and yesterday urged them to set aside the policy for the sake of Bermuda, Bermudians and the Island's economy.

"This policy does not understand how business operates," said Mr. Edness yesterday. "It is very costly. Some businesses would not even consider coming to Bermuda because of this restriction, and this is making Bermuda less competitive."

The term limits on work permits is a policy put in place in 2001, and restricts guest workers to six years, with an extension of three years. Key employees will be exempt from the policy, but as the 2007 cut off date looms, businesses have been voicing more and more concern over the issue.

"It reminds me of the kind of restrictions the Bahamians applied to work permits in the 1970s. Then they were a large insurance centre, a centre for captives. But as a result of that policy they lost their entire insurance industry - and in those days they were leaders. I believe this policy is similar, creating tremendous difficulties for business. It is not a very balanced policy."

He said Bermuda had no alternative but to permit people to come to the Island to work.

"Not only for positions where we do not have any Bermudians who are trained, but also because we do not have enough Bermudians for the jobs that are produced by this economy. We have in place a policy that protects Bermudians and is a good one," he said.

He said each work permit had to be advertised, and if a qualified Bermudian applied, then they would be entitled to the job.

But he said that companies already had problems getting staff through the immigration process, and faced delays in recruiting for essential staff.

"One of the difficulties businesses have right now is trying to replace employees and the amount of time it takes to get it through, so it is extremely costly to businesses," he said.

And he gave as an example of one type of business that might be ruined by the six year limit - the hairdressing business. This is a profession that does not have enough qualified Bermudians to fill all the vacant posts, he said.

"By the time they get somebody here, they build up a regular client list, by the time they have settled in the business, it is time for them to go home. And this is the same in any business," he said.

"If we had enough people to bridge the gap it would be fine," he added. "But we don't have enough Bermudians to fill these jobs. The way Bermuda is set up, until we get a handle on population, growth and how many people we need, we will have to import people to fill jobs."

And he said he had spoken to many heads of business who were angry at the policy and what it meant for their businesses.

"My feeling from what I hear is that many are not going to be bothered (with the policy) and will leave Bermuda. This is not a threat. Once we start losing business because of restrictive practices we are never going to get it back. It will have a dramatic effect on the economy. And that is why I am speaking out - because of this fear I have.

"I would like to see Government revoke the policy and to rethink what they have done. It is called taking a sledgehammer to kill a fly."

And he said that he did not believe that Government understood the full scope of the problem due to the reluctance of business executives to come forward for fear of retributions when they put in their work permits.

"They are afraid to speak," he said. "What they are doing is they are going to seek alternatives to their business, which means they are going to move from Bermuda and we can't afford to let this happen. I still circulate in the business community and this is why I am reacting. I am not sure the Minister understands the scope of the problem.

"One of the large insurance companies here said it would take just one month of profits to exit Bermuda because of this restrictive policy. If this is what they are saying - and they have invested a great deal on the Island - then what about the other companies that are not so entrenched in Bermuda?"