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‘The BPSU will not stand for or allow privatisation of public services’

A discussion about privatising Government services has caused considerable anxiety among public sector workers.

Bermuda Public Services Union president Kevin Grant issued a statement which questioned the motives of privatisation advocates and noted that some privatisation efforts elsewhere had failed.

Meanwhile, the Opposition One Bermuda Alliance has declined to comment.

“It is uncertain if those who are calling for privatisation want to control a larger piece of the pie or if they just have a desire to see a balanced government,” said Mr Grant.

“Whatever their motivation, the BPSU will not stand for or allow privatisation of public services.

“We understand that privatisation of public services will have negative effects on our community.

“Examples of privatisation have shown that quality of services decline and workers’ wages and benefits are reduced as private employers look for low wage contracts to provide services.”

Premier Paula Cox issued a statement saying Government would consider “partnering” with the private sector when asked whether privatisation of certain Government services should be an option given the economic downturn.

The issue was raised at Monday’s budget breakfast briefing by Digicel CEO Wayne Caines who suggested that privatising the airport and the ferries were among the measures Government should consider to raise revenue.

“Government is always looking to create efficiencies and is prepared to consider partnering with the private sector on issues that are in the national economic interest,” said the Premier when this newspaper asked for her reaction to the idea.

“As part of the Medium Term Expenditure Framework, efficiency reviews will take place in all Ministries to improve service delivery and get the best value for taxpayer’s dollars.”

While the OBA has decided to stay out of the discussion for now, United Bermuda Party MP Kim Swan says his party wants the tourism industry to be managed by an independent Tourism Authority, supports a Parliamentary discussion on privatisation for some non-essential services and has called for a White Paper on the issue.

“In the midst of an economic recession and high levels of unemployment, it is sad that some members of our community are still looking to disadvantage public sector workers,” Mr Grant’s statement continued.

“Public sector workers have just recently agreed to a pay decrease. Are they not playing their part to aid the Government and help turn the economy around?”

Mr Grant’s statement added: “Public sector workers did not cause the economic downturn or a decrease in Government’s revenue. It seems as if everyone wants to put public service workers on the chopping block like they are used computers or machinery.

“They are our nurses, police officers, firemen, customs officers, postal workers and teachers.

“Public sector workers have children, mortgages, rent, school fees and bills to pay like everyone else. Let’s remember that!”

Mr Grant noted that New Zealand had privatised its postal service and public transportation “only to buy them back years later regretting their initial decision to privatise those services,” while an independent report in Britain found that privatising the post office had failed.

“Bermuda is facing real problems and we need real solutions not individuals throwing loose suggestions out that have serious negative effects on peoples’ lives.”

Contacted by

The Royal Gazette, Mr Grant said that he received numerous telephone calls from concerned BPSU members when the story appeared in yesterday’s newspaper. “They were concerned that privatisation in some areas would mean job losses.”

He added that his statement was not directed at Government.

Meanwhile, the Bermuda Industrial Union has scheduled a press conference on the topic for this afternoon.

The LF Wade International Airport made a modest profit.
Modest profit

The Department of Airport Operations is making a healthy profit even as we experience an economic downturn, according to Airport General Manager Aaron Adderley.

Mr Adderley told this newspaper that the DAO is financially sustainable despite what it might look like in the Budget Book.

The Royal Gazette reported on Monday that the DAO “is another big money loser, employing 46 people and costing over $20m to operate while bringing in just over $11m”.

Not so, if you include Airport Departure Tax, said Mr Adderley in a statement last night. “The Department of Airport Operations’ annual operating costs do equate to roughly $20m and more than half of that figure is for services that are privately outsourced.

“When all airport-driven revenue streams are factored in which includes landing fees, parking fees, rent, concession fees, passenger departure tax and security fees, the airport in fact is self sustainable on an annual basis,” said Mr Adderley.

“While the Budget Statement Revenue Estimates suggests that the expected revenue for the DAO is $11.3m, this does not include Airport Passenger Departure Tax revenue which is estimated at $14m for 2012-13.

“Thus, total estimated revenue generation for the Airport is just over $25m. With expenditure for the coming year estimated at $21.4m, the Airport is expected to generate a modest operating profit of $3-4m for the 2012/2013 Budget year.

“This is despite the fact that unlike other airports around the world, LFW does not have the benefit of rental car income, a major non-aeronautical revenue source.

“At many major airports, rental car fees account for upwards of 50 percent of all revenue intake.”

In the Budget Book, Airport Departure Tax is listed under Tax Commissioner and not under Airport Operations.

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Published March 01, 2012 at 9:11 am (Updated March 01, 2012 at 9:11 am)

‘The BPSU will not stand for or allow privatisation of public services’

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