used it to bash Government.

They accused the UBP of 20 years of "gross mismanagement'' of the terminal, and said the report was startling in its allegations of inefficiency.

The no-holds-barred report recommends the Airport should be run on business lines by an independent Government authority. That could be followed by selling it, it says.

The report, from a team headed by accountant Mr. Charles Kempe, declares: "A dramatic change is required if the standards of service, efficiency and cost-effectiveness are to be improved.'' And it slams Government red tape, while pointing out bureaucracy is not unique to Bermuda.

Transport Minister the Hon. Ralph Marshall told the House of Assembly that Government agreed with the report's recommendation, although the Airport would not be privatised unless Parliament consented.

Countries around the world had made similar changes, he said.

He had plenty of his own criticisms of the way the Airport was run, saying official ways of doing things, while not necessarily wrong in themselves, were not right for an airport.

Examples were the continued delay in getting more immigration officers and the lack of signs and baggage carts in the arrivals area.

The Airport made a $3 million loss each year, he said, and even after the authority was set up it might not break even for up to six years.

Mr. Marshall also criticised the lack of Airport shopping, except in a "sterile'' area.

Under a separate authority the Airport would be "better organised, more efficient and more accountable'', he said, pointing to the "arms-length'' management of public transport and Dockyard.

The authority would hire and fire more easily, but there was no suggestion of fewer staff. Instead more workers could be needed, and current staff would be protected for a while after the takeover.

He added that if the US Navy pulled out the authority could open a container port on the site, with trucks going into Hamilton early in the morning on empty roads.

He apologised for the committee not consulting with the unions.

Shadow Transport Minister Mr. Walter Lister was startled to see the report's statement that a separate authority would run the terminal in a more efficient and businesslike way.

The public thought that had been Government's intention, he said.

"But it's quite obvious that it's extremely inefficient. Gross mismanagement has been taking place in the last 20 years.'' He called for a port authority to run both air and sea traffic, and criticised Mr. Marshall for studying airports when all Government controlled was an air terminal.

"You can't have an airport authority if you don't have an airport.'' The terminal had only about 800 workers and only really operated between 11 and 2.30, while Government had been comparing it with large airports overseas.

He said the bill for modernising the departures lounge had gone from $9 million to $26 million, while Barbados had a whole new airport for $15 million.

Instead of "passing off'' the terminal into private hands, he said, there was a different solution -- replace the Government.

It was "pie in the sky'' to talk about what would happen if the US Navy moved out.

The PLP cannot support privatisation of the site, he added.

NLP leader Mr. Gilbert Darrell said Government had admitted not being able to run the Airport, but this was a very difficult task because of the concentration of traffic in a short time.

He did not believe the US Navy would pull out -- and if they did there would be an international agreement about such a important air link. Government would not be totally responsible.

Government was admitting there must be some weakness at the Airport, he said.

"If that weakness is down there it must be in other departments also.'' He could not support the report. He wanted a port authority that stayed in Government hands.

Deputy Opposition leader Mr. Walter Roberts demanded to see figures detailing the inadequacies at the Airport which Government Ministers had referred to.

Referring to the committee he said: "A professional Government body has not recommended this, but an ad hoc amateur group is saying it is inefficient and after 40 years there is a need for change.

"All you read in this report is that Government should make the Airport more efficient. They should be able to make it more efficient themselves, they should not need to privatise.

"This report is a heavy indictment not only of the Government's inadequate handling of our lifeblood which caters for 500,000 visitors a year but to the administrators of this Airport and managers who do not know what they are doing.'' Minister of Delegated Affairs the Hon. Sir John Sharpe claimed the PLP constantly referred to a "red herring'' of how costs rose from an estimated $9 million on airport improvements to $26 million.

Sir John said: "It was decided that we should go on and do much more than was originally intended.'' He called Mr. Roberts's remark that the committee was made up of "ad hoc amateurs'' as uncharitable.

He said: "It happens to be headed by one of the most senior chartered and management accountants in this country.

"My personal view is that the Airport has not been mismanaged over the years.

The crux of the report is that it could be managed a better way.

"We have to accept that government departments are bureaucratic with all sorts of checks which makes decision-making slow and cumbersome. A quango can be more flexible than a Government department.'' Shadow Tourism Minister Mr. David Allen said he found it "disarming'' that a committee including many strong UBP supporters should detail the Government's "massive incompetence on the running of the Airport''.

Mr. Allen said: "We have no other airport. This is our only gateway.

Tourism and international business rely on this. It is a fundamental pillar of our economy. Sir John Sharpe has minimised it to say it is only a small part of the economy. Without it this country would collapse.

"It is not a regional airport like Manchester or Denver. We have all our eggs in one basket.'' He said that suggestions that the Airport shares could be sold off to the British Airport Authority would be a form of economic colonialism.

Mr. Allen said: "Who will buy the shares? It is not going to a hotel worker or even an ordinary businessman, it will be the Front Street Fat Cats.'' He demanded the resignation of the Minister of Transport and said that members of the Cabinet should "hang their heads in shame.'' UBP MP Mr. Harry Soares asked why Mr. Allen had suddenly become quiet about a Bermudian airline which he has mentioned in the past. He said Mr. Allen had been quiet because the idea was "foolish.'' Mr. Soares said: "Our airport has served us well. It has had high standards for a country of our size but there can be improvement.

"We are trying to respond to a changing world and the way we do business. The Airport like Bermuda must be market-driven. The world is demanding higher standards and we must provide them.

"We do not know what NATO and the US Navy are going to do, but we must be prepared.'' PLP MP Mr. Eugene Blakeney believed the Government was mesmerised by privatisation. Mr. Blakeney said: "The only thing I know about privatisation is that it gives inferior services because the main motive behind privatisation is profit.

"We cannot be hiving off a very important part of our country and not be sure whether it will go to private enterprise and be in the best interest of Bermuda.

"Airlines were deregulated a few years ago and many of them have ended up billions of dollars in debt. We are lucky that some of them are still flying and providing our bread and butter.'' Opposition MP Mr. Julian Hall claimed that the committee was set up to justify a conclusion that had already been reached.

Mr. Hall said: "This committee was set up from the start to justify the privatisation of this airport. It is like the Committee on Competitiveness which is going to come out in favour of casino gambling.

"Why is it that the Government is incapable of running the Airport at a profit but a private organisation can?'' Mr. Hall said Government was running full steam ahead with plans to privatise the Airport.

And he voiced fears about the jobs of Bermudians if the Airport was turned over to the vagaries of the private sector.

Many private organisations showed an anti-labour mentality.

Mr. Hall said he preferred an elected Government in charge, accountable for fairly apportioning the "goodies'' of business to those most deserving.

And if it failed to do so, the people could have their say.

It was a myth, said Mr. Hall, that Government had a monopoly on wisdom in running businesses.

This was clearly demonstrated by Government's failure to make the Airport a commercial success.

"Am I going to be old and grey before I can see anything but a UBP Government? I can't accept it.'' Mr. Hall asked what authority there was for the report's contention the Airport could not be run commercially by Government.

The report was totally meaningless and "just words'', he added.

"Why can't a Government use, where appropriate, private sector disciplines?'' He added: "The reason Government doesn't tend to go bankrupt is that they just rob the people, and I say that advisedly.'' Mr. Hall scoffed at an attempt to draw parallells between Bermuda's Airport and Heathrow or Gatwick, which are vastly larger concerns.

He wondered why Government was considering only an interim measure -- a quango -- before privatisation.

"It is nothing more than a minuet. The UBP Government always engages in this fancy footwork dance. This Government plans the privatisation of the Airport.'' Opposition leader Mr. Freddie Wade said he viewed with great suspicion the issue of privatisation.

Most of the garbage collection had been privatised, and the postal service was being gradually whittled away.

The National Sports Stadium was next in line, said Mr. Wade.

Mr. Wade described it as "arrogant'' for the report to suggest only businessmen and professionals could run the Airport.

This contained an element of racism -- most successful businessmen in Bermuda were white.

"The report seems to perpetuate the idea business in Bermuda should be put in the hands of the white community.'' Mr. Wade said he was certain Government was planning to sell the Airport to its friends.

"It's a bad idea and simply demonstrates Government's inability to operate one of the most important sectors of the economy.'' Opposition whip Mr. Stanley Lowe said: "I find it worrisome there is a lack of response from the Government side.

"Only three Government members have gotten up to support the motion. I am sure there must be other members on the Government side who have some strong feelings.'' Mr. Lowe believed the motion one of the most important issues to come before the House.

"I shudder to think members of Government don't have an opinion.'' Mr. Lowe also voiced concern at the objectivity of the report, since the delegates responsible were hand-picked by the Premier.

Mr. Lowe went on to outline improvements that the Airport needed, including the arrivals area.

Mr. Marshall agreed with this, saying the arrivals area needed a "mixing room'' where passengers coming in could mix with friends.

But there were cash constraints preventing this at present.

Mr. Marshall said there were possible ways of increasing revenue, such as charging airlines for congesting the Airport runways.

Passengers could also be charged for capitals works at the Airport.

Mr. Marshall continued by challenging the Opposition to find fault with quangos, such as King Edward VII Memorial Hospital, Wedco, Public Transportation Board, Bermuda College, and the Bermuda Housing Corporation.

And he stressed: "Government has not accepted privatisation as the ultimate step.'' He said Government would own all the shares of the corporation.

And he guaranteed Government would not look at privatisation without the House's approval.

It was absolute nonsense for Opposition MPs to suggest Government planned selling off the Airport to its own friends.

This was just political rhetoric brought on by the impending election.

Mr. Marshall also hit back at Mr. Hall who claimed he had benefited -- he hoped quite properly -- from his political connections.

Taking a swipe at Mr. Hall he said: "He has got his own problems and tries to take them out on everybody else.'' In a named vote Mr. Marshall's motion for the House to support Government's response to the Air Advisory Committee was squeezed through by a margin of 18-14 in a straight split on party lines.