Government has unveiled its fiscal plan to address what the Premier called Bermuda’s “financial tsunami” as Finance Minister Bob Richards delivered his first Budget Statement yesterday.A new statutory debt ceiling of $2.5 billion, $330 million in additional debt and a more aggressive approach to collecting unpaid taxes are some of the features of what Mr Richards described as a budget based on reality rather than hope.“We have found ourselves in a financial calamity that will require cooperation and shared sacrifice from all of us,” said Premier Craig Cannonier at a post Budget Statement press conference.He added that Government had been working to bring foreign investment into the Country and had met with “countless overseas parties”.“But understand Bermuda, this is not a sweetheart budget, but it is a workable budget.”Mr Richards dubbed the budget as “the beginning of a new direction in the manner in which the economy of Bermuda and the finances of the Bermuda Government are managed”.“The hallmarks of the new management style will be realism, transparency, prudence and decisiveness,” he said.As expected, Mr Richards also signalled that public sector workers are going to be expected to share the sacrifice by taking a pay cut.However the Budget estimates show a 4.2 percent decrease in revenues over the current year and close to five percent increase in expenditure - with a significant increase in personnel costs.Mr Richards admitted at the press conference that his administration had much still to learn.“We’ve been quite realistic on the revenue side,” he said. “On the cost side we have not come to grips with the cost structure of this Government yet. We have not been in Government for three months.”Car owners will face a three percent increase in licence fees — with seniors losing their exemptions for certain classes of cars. Smokers and drinkers will be facing higher prices for their vices come April 1 when the new fiscal year starts, and land tax for homes with an annual rental value of more than $90,000 will be increased.The price of bus passes will be increased to yield an extra $500,000 and the Corporate Services Tax will go up to six percent from four percent to deliver an extra $1.5 million to Government coffers.Government expects to raise an extra $2 million from the sin tax hikes, another $3.4 million from land tax adjustments and $2.2 million extra from the vehicle licensing changes.Payroll tax relief for the hospitality and retail sectors, extended by the former administration, will continue.But funding for the Bermuda Police Service will be boosted, as promised during the election campaign, and more money will be made available to the Department of Corrections to recruit professionals “related to the rehabilitation and management of inmate issues,” Mr Richards said.The Department of Education is being allocated close to $8 million more than the original allocation for the current year as Government plans to expand programmes such as Career Pathways and services to special needs students.And the Health Ministry is slated to get a $4.2 million increase.Notable decreases in projected spending, as compared to the original allocations for the current year, is a $2.6 million drop for the Tourism Development and Transport Ministry, $5 million less for Public Works and a $6 million drop for the Home Affairs Ministry.The Environment Ministry is also being allocated less money and will have to make do with $580,000 less next year — with the biggest drop being $847,000 for Conservation Services.The budget will make good on a pre-election pledge to give a two year payroll tax holiday to businesses for new Bermudian hires — a measure which the Finance Minister said would be revenue neutral.Non-Bermudians who purchase property will have their licence fees slashed to eight percent from 25 percent for the next 18 months after which the licence will cost 12.5 percent of the purchase price.Licence fees for purchases of condos not used for tourism purposes will be cut from ten to six percent for the same period and rise to eight percent thereafter.– PRC holders will also get a tax break on their property purchases — down to four percent but increasing to six percent in 18 months.“This is a jobs programme, pure and simple,” he said provoking laughter from the Opposition benches.“The lowering of licence fees as outlined will stimulate much needed inward direct investment into Bermuda. The purchase of a new house, particularly those at the highest echelons as represented here, is frequently accompanied by renovations or customisation of some description. Local construction companies will be required to carry out such modifications, thereby increasing the demand for labour in that depressed sector.“As these customisations will be varied in scale and scope it should create opportunities for construction firms both large and small, thus creating a considerable diffusion of opportunity in the sector.“Furthermore, the fact that the low licence fees will revert to higher levels after 18 months should have the same psychological effect as the end of a ‘sale’ in retail: it spurs people to act sooner instead of procrastinating.”The measures, he said, would boost government coffers because demand for property is price elastic and stamp duties will remain unchanged.Non-tax job growth policies include the elimination of term limits, and speeding up processes such as planning and work permit applications and company formations to improve Bermuda’s competitiveness, Mr Richards said.Missing from the Budget Statement is a plan to waive stamp duty for first time homeowners who purchase property worth less than $1 million, pledged during the election campaign.And a new procurement policy which will reserve $80 million of annual spending to small businesses, another election pledge, was also missing from the statement.But Mr Richards addressed the procurement policy at a press conference following the statement saying that Government still intended to deliver on the promise.And he defended the payroll tax incentive given to employers for new Bermudian hires saying that “only an employer can create a job”.Mr Richards began his statement with an overview of the global and local economies.Available economic indicators provide no cause for optimism, said the Finance Minister, and Bermuda is expected to head into a fourth straight year of recession.“A two-track strategy that strikes a balance between responsible growth and disciplined financial management” was being pursued, Mr Richards said.“The first track will implement specific pro-growth economic policies to stimulate much needed foreign investment, restore confidence in the Island as a place to do business and create new jobs.“The second track will eliminate wasteful government spending, thereby reducing our national debt over time.”But Mr Richards warned that fixing the economy will not happen overnight.“It will take time to implement solutions that work for the greater good. It will take time to revamp structures that inhibit our ability to operate efficiently and effectively.“And it will take time to reverse trends and trajectories locked in place by past practices.”