The ruling Progressive Labour Party (PLP) is failing its core working class supporters while surging ahead with policies friendly to big business and the rich, backbencher Wayne Perinchief told members of Rotary Club this week.

Mr. Perinchief's speech raised some eyebrows among his audience whose members included a number of stalwarts of the business friendly United Bermuda Party (UBP).

The ruling party MP, who has emerged as the chief and most vocal critic of Premier Jennifer Smith, proposed tax reform which would tap into the vast resources of the international business community as one way to raise additional revenue and said that rent control for housing on the lower end of the market was a misguided policy.

He told the club members that the 1998 election of the PLP was greeted with mass euphoria and marked the first time that "Bermuda was going to be managed by the sons and daughters of the working class of this country".

But the same PLP supporters who had danced in the streets to celebrate the new Government were now "crying foul".

Mr. Perinchief explained: "The PLP Government that was supposed to deliver `the new Bermuda' along with progressive policies for the advancement of labour are now bemoaning the slow progress of delivery of those policies, whilst having to swallow the fact that `policies' such as the relaxation of the 60/40 rule for corporate Bermuda, the granting of a new bank charter for the `landed gentry', the Hotel Concessions Act for largely international corporate entities to name a few, give the impression that the PLP has become a conservative party that now supports the same people who were supported by the former Government."

The PLP had to make a shift from its "left wing socialist" agenda to a "comparatively radical right wing" philosophy in order to win the election, he said.

"In short, corporate Bermuda would have to believe in the PLP and its ability to manage the economy on the one hand, and on the other, (the party would) have to have the ability to deliver a broad based social contract to the middle and working class at the same time."

Mr. Perinchief continued: "This formula was always going to create a problem. It would be virtually impossible to deliver both packages simultaneously."

And while he acknowledged that Government had made some progress on "social reform" with legislation on Alternatives to Incarceration, CURE, the Parole Board Act and the Long Term Residents legislation, the core middle and working class supporters remained disenchanted with what had not been done, he said.

But, he said, the working and middle class were disenchanted because mortgages had become harder to service, affordable housing does not exist and drugs and crime are on the increase.

He added that "better paying jobs are still perceived to be going to foreigners" and claimed that "Bermudian families are leaving Bermuda for better opportunities overseas".

Locals were being priced out of their country by "super rich, foreign residents and well paid `nouveau riche' residents who work for International Companies," he added.

"Over priced rents, houses and land are driving inflation at a pace which will soon result in overseas flight of Bermudians and a welfare state for those who remain... This hypothesis is neither alarming nor unrealistic. It is happening now as I speak."

He said given the "tremendous intellectual resource pool" in his party's parliamentary group, "the PLP Government should be able to deliver a social contract to the middle and working class which would resolve the problems".

But he lamented that the PLP "is not using its intellectual resources to the fullest".

Outside the cabinet and the Speaker "there remain 13 parliamentarians who could be appointed on working committees dedicated to solving problems," he said.

"Most of these people hold either professional or academic degrees and centuries of practical experience in management and problem solving."

He blamed the "inherent flaws" of the Westminster system for the exclusion of the back bench in helping to formulate policy.

He claimed that the PLP Government "certainly operates in the openness of public scrutiny. It is truly a Government which is run by the people for all the people".

Mr. Perinchief continued: "No other Government has enjoyed the rapture or the recrimination that this new Government has had to endure. I believe fervently in the longevity and sincerity of its mission which is to serve the people of this Island and I shall forever remain faithful to the causes which will continue to make this Bermuda the greatest little country in the world."

At question time former Premier Sir John Swan warned that international business could take their capital elsewhere if Bermuda turned to the sector to raise revenue through taxes.

And he told Mr. Perinchief that as leader of the country Premier Jennifer Smith was in a position to see things from a "thoroughly different perspective".

He also warned that ongoing attempts to unseat the Premier so close to an election could cost his party dearly at the polls.

"Sometimes you have to mould from within rather than destroy from without."

Mr. Perinchief responded by praising Ms Smith as a "Premier who has served us well" but he added that every organisation evolved to the point where the leader had to be replaced.

And he pointed to Sir John himself as someone who had to "face that demise", adding: "At some point their (a leader's) vision may become discordant with where that organisation must go."

But he added that the Premier could yet "redeem" herself and if a successor cannot be found, he and the Premier's other opponents would "lock arms with the Premier and move forward".