The following is Premier the Hon. Sir John Swan's reply, in its entirety, to a speech delivered earlier this month by former deputy governor Mr. Peter Lloyd and reprinted in this newspaper on May 15.

* * * The Royal Gazette , in its Monday, 15th May edition, devoted several column inches to a speech with former Bermuda Deputy Governor, Mr. Peter Lloyd, delivered at a Forum on Independence held 1st May at the Bermuda Industrial Union.

While the debate on independence has stimulated a variety of opinions and comments from a wide cross-section of the community, I must confess to being some what puzzled by the views expressed by the former Deputy Governor.

At the outset of his speech, he seems to revel in the fact that he has never applied for Bermudian status, notwithstanding his close Bermudian connections and goes on to say that, as a guest in Bermuda it is not his place to "lecture (his) hosts about whether they should be seeking Independence''. He then goes on to do exactly that.

Mr. Lloyd is unable to resist the temptation of falling into the familiar trap into which most naysayers fall and that is to draw attention to those countries where independence has been less successful than had been anticipated. He does not, of course -- perhaps for obvious reasons -- highlight those countries where the move to independence has been neither a "disappointment'' or a "disaster''. I think, in particular, of countries like Barbados, Mauritius, Dominica, St. Lucia, Singapore, Canada, St.

Vincent and The Grenadines and Malta.

There is, however, one thing on which Mr. Lloyd and I agree and that is that independence for Bermuda does not equate with either `disaster' or `disappointment'. Bermuda is another world. Bermuda is different. Bermuda does have a long and distinguished history of parliamentary democracy, indeed, the Island this year celebrates its 375th anniversary as a parliamentary democracy. There are few other countries in the world which can match that record.

Bermudians are pragmatists and optimists. It is they primarily, along with non-Bermudian expertise, who have created the modern, sophisticated, prosperous and stable society we have today. Those who lack faith in the ability of Bermudians to persevere and to succeed do the people of this Island a great disservice.

In support of his lukewarm attitude towards independence, Mr. Lloyd points to the lack of cooperation between the two political parties on some issues as `evidence' that each is suspicious of the other. So what? Is not the Labour Party in Britain suspicious of the Conservative Party? Is not the Republican Party in the United States suspicious of the Democratic party? Mr. Lloyd's belief that neither Party in Bermuda could trust the other in the event of independence is a gratuitous insult to all Bermudians. Why should independence turn Bermudians from being responsible, law-abiding citizens into thugs bent on hijacking The Constitution and abusing power? Another of the issues to which Mr. Lloyd turns his attention is that of appeals to The Privy Council in London. Recognising the importance of such a provision to Bermuda's legal and international business community, it is the intention of the Bermuda Government to retain the right of appeal to The Privy Council. Moreover, that right is to be specially protected in an independence constitution. That this is the Government's position derives from the fact that, given Bermuda's special circumstances, retaining this avenue of appeal is appropriate for Bermuda.

It is well worth noting, however, that some Commonwealth countries, with their own well-developed legal systems, have abandoned the right of appeal to The Privy Council, preferring to rely on local or regional expertise. Indeed, the idea of establishing a final Court of Appeal for the West Indies has been under active consideration for a considerable period of time. There is no reason to believe that the Judges of such a Court would not be honourable, competent and impartial. The impression is often left that it is only an English Court which is capable of rendering a sound and impartial verdict.

That is obviously not the case, particularly if one reviews the recent history of British Courts, many of those decisions have been overthrown amidst charges of abuse and corruption. Do these lapses mean that the whole British legal system is corrupt and ought to be abandoned? Certainly not. If anything at all, what the circumstances in the U.K. suggest is that no system is absolutely fool-proof, but a system can be designed to ensure that the opportunities for abuse and corruption are minimised to the greatest extent possible.

In relation to judicial appointments, Mr. Lloyd raises the same, tired old arguments that the existence of the Judicial and Legal Service Commission is not enough to prevent `political' appointments to the Bench. He goes on the say that "it has too often happened that Prime Ministers have advised the appointment of their political cronies''. That criticism has been levelled at British Prime Ministers in the past, but is that any reason to abandon a system and a procedure which, in most circumstances, works perfectly well? I think not.

Unlike Mr. Lloyd, I have enough faith in my fellow Bermudians to know that, in respect of judicial appointments, Bermudians are more than capable of devising a system whereby such appointments can be made fairly, impartially and with due regard to the best interests of Bermuda and her people.

In the section of his speech addressing the topic of judicial appointments, Mr. Lloyd raises a number of questions about the security of tenure of judges, their removal and the length of their appointment. One would have thought that the answers to these questions ought to be obvious, even to someone like Mr.

Lloyd, a one time Deputy Governor in Bermuda and a former Governor of The Cayman Islands. In that latter capacity, Mr. Lloyd would have had to have been consulted on the appointment of certain very senior officials. Did he feel himself competent to make such a decision? From whom did he take advice in respect of those appointments? Is there any doubt that he applied his best judgment to such matters? Why should a post-independent Bermuda not adhere to the same high standards when considering similar appointments? As far as the electoral system is concerned, Mr. Lloyd and I do find a small patch of common ground: that which relates to the uneven size of some constituencies. He is at least bold enough to point out, as some have not done, that Bermuda is not the only country where all constituencies have the same number of voters. Certainly, the UK does not. Not even the United States, that bastion of democracy, has achieved absolute parity in its electoral districts. What Mr. Lloyd fails to understand -- and others, like him -- is that the current electoral system, about which the Opposition complains so loudly, is the very same system that once gave the Government a 30 to 10 seat majority in the House of Assembly. It is the very same system which has also given the Opposition the 18 seats it currently holds in the House of Assembly.

It seems that the system needs to be changed when the Government retains power but it is a system which works well and undergirds democracy when it boosts PLP representation in the House to 18 Members.

There is no validity whatsoever in Mr. Lloyd's questioning of the manner in which The Boundaries Commission is appointed.

The present Bermuda Constitution makes ample provision for the appointment of such a Commission and related matters. Mr. Lloyd states that the Chairman and the Judicial Member should both be impartial and hold the balance. He goes on to ask the rhetorical question, `Who would hold it after Independence?' Again, Mr. Lloyd raises a red herring, but in a deliberately insulting way.

The present Bermuda Constitution makes specific provision for the appointment of a Boundaries Commission. There has never been any cause to question the way in which the Chairman and the Judicial Member have been appointed, even if, on occasion, some of the Commissioners have not agreed entirely with the Commission's Report. There is no reason to suppose that the appointment of The Boundaries Commission would change in any substantial way, except that the appointments would be made by the Governor-General rather than by the Governor as at present. The Chairman and the Judicial Member would continue to be impartial Members of the Commission and they would also continue to hold the balance. Government envisages no change in that regard. It is therefore somewhat mischievous for Mr. Lloyd to raise doubts about a procedure whose appropriateness is, in fact, beyond doubt.

Few comments made by Mr. Lloyd underscore his political naivete more than those supporting a coalition government in circumstances where there are two or more political parties represented in a legislature.

That someone of Mr. Lloyd's reputed experience as a colonial Deputy Governor and Governor could make such a comment is truly astonishing.

Coalition governments do not work. If proof were needed, one need look only to Italy where there have been nearly 50 governments since the end of World War Two in 1945. Is that what he envisions for Bermuda? Furthermore, history shows quite clearly that coalition governments work best only in times of grave national emergency or war, but even then, such governments are not immune to the stresses and strains brought about by different approaches to various issues, some of genuinely national importance or interest. The prospect of a coalition government in the United Kingdom or Bermuda or in the United States or in Canada, is remote in the extreme, notwithstanding Mr. Lloyd's apparent belief that such governments "may help to promote harmony and unity''.

But, more than that, Mr. Lloyd undermines his own argument when he points up the fact that the UK electoral system, which itself is not perfect, can result in a situation where one Party can have a majority in Parliament despite having gained fewer votes than another Party.

What I find most offensive about Mr. Lloyd's remarks are their condescending tone. He mentions, for example, that if the referendum were to result in a positive vote, "then the probable next step would be a conference, attended by representatives of the UBP and of the PLP, under UK chairmanship, to decide on the provisions of an Independence Constitution.'' There is no question that a positive result would activate a constitutional conference. There's nothing `probable' about that. Why Mr. Lloyd believes that those attending such a conference would not take the time to reach decisions that are in the best interests of Bermuda and Bermudians is beyond me. That he would suggest that such important decisions would necessarily be `taken in a hurry' is a gratuitous insult to Bermudians.

Many of the so-called `anxieties' to which Mr. Lloyd refers are those of individuals who are comfortable with the status quo and who lack a sensitivity to the aspirations of many of the Bermudian people.

He talks about having the `time to embark upon proper studies'. How many studies does Bermuda need? There was a `study' in 1977. There was a `study' in 1979, along with a Constitutional Conference. There was a `study' in 1987; and there was yet a further `study' in 1995. Shortly, the Bermuda Government will be presenting its Position Papers for both parliamentary and public scrutiny.

The recent Green Paper and the Position Papers result from wide consultation with Bermudians from various walks of life, of various political persuasions and with different stakes in the future prosperity and stability of Bermuda.

Mr. Lloyd speaks of consulting members of the international business community and others. Their views and concerns are reflected in these documents. That is democracy at work. The forthcoming referendum on independence is just that -- democracy at work: an opportunity for every Bermudian to be involved in determining the future and the destiny of our beloved Island.

That many are unshakably attached to Great Britain cannot be denied. For them, that the question of independence has been raised at all is the ultimate, even unforgivable, heresy.

For others, Bermuda's Dependent Territory status is comfortable, with Britain as the Island's `security blanket'.

But for many, independence is viewed as the final stage in Bermuda's development as a mature, stable and prosperous society where the cherished values, ideals and freedoms we enjoy and revere will remain undiminished.

For many, independence will mean that the Island's destiny rests in the hands of Bermudians -- not in the hands of bureaucrats and politicians thousands of miles away.

For many, independence represents an opportunity to make its own decisions about its own interests. No longer will it have to tag along with decisions Britain makes in its own interests, regardless of the impact those decisions may have in the Dependent Territories. No clearer example of this is the British Government's decision -- without consultation with its Dependent Territories -- to unilaterally remove British citizenship from the citizens of these Territories and replace it with a new designation, `British Dependent Territories' Citizenship'. That was something the Dependent Territories neither sought nor wanted. It was thrust on the citizens of the Dependent Territories. No consultation. No opportunity for input. Nothing. But, it suited Britain's interest and the deed was done, like it or not.

For many, independence will remove the demeaning situation where Bermudians, on entering Britain, are steered to the `Aliens and Others' line while other Bermudians, with a British connection, are directed to another line altogether.

For many, the decision to become independent will mean that Bermuda will have to seek the prior approval and sanction of the British Government to undertake any decisions which are deemed to be in the Island's best interests. For many, independence is seen as that vehicle which will promote greater self-reliance; a greater sense of self-esteem amongst the people of Bermuda; a stronger sense of the Bermudian identity; a greater cohesiveness of the people of Bermuda; and a strengthened sense of critical need of all Bermudians to work together to maintain the stability, harmony, prosperity and best interests of the Island and her people.

Independence is not a panacea and it does hold risks in the same way as a student heading off to university; in the same way as an entrepreneur opening his own business; in the same way as a young person moving out of the family home into an apartment of his own; in the same way as a couple starting their journey through life as husband and wife.

With a clear sense of purpose; with a deep and abiding faith in God; with the traditional grit, determination and resourcefulness of the Bermudian; and with every Bermudian working in common purpose, there is no reason why, given a positive result in this summer's referendum on independence, Bermuda ought not to succeed admirably as it graduates from the status of being a Dependent Territory to that of becoming an independent country within the Commonwealth.

All we require is courage and faith in ourselves.