Finance Richards Bob Richards will break ties with tradition and table new Budget Statements that will account for three years of fiscal planning instead of a one-year period.The Minister made the disclosure yesterday while presenting the brief on the Ministry of Finance. But he was quick to note that the new framework was introduced by the former Progressive Labour Party Government.Said Mr Richards: “The practice of applying a one-year time horizon to the national budget needs to change.“We are going to need a new approach, a longer term budgetary model, one that provides greater flexibility and a planning perspective that extends out beyond the next 12 months.“As a first step towards the introduction of the three-year medium term budget expenditure framework which the Government will launch next year, the Ministry intends to continue work on the development of an open budget structure, which I have to say was introduced under the former Government; at least nominally.”He noted that while Bermuda’s capital account “has routinely used a multiyear approach, this has not been the case for the current account”.And he said the proposal “provides Bermuda with a foundation on what will become a three-year revolving framework, one that will embed long-term structural reforms into the current account strategy”.“As we prepare for a period of change, the challenge of public expenditure management will be to ensure that service delivery policies are aimed at the right segments of the population and that performance meets the expectations of its citizens,” said Mr Richards.“To transition to this model we will need to adopt a medium term plan that will enable us to consolidate and generally rebuild our revenue base, identifying new sources of income while underpinning existing sources.“This requires efforts on three fronts, better budget preparation, better and more transparent budget execution and systematic budget monitoring.“The whole underpin by clearly articulated sector strategies, efficient delivery agencies and monitoring by oversight entities and the legislature, and most importantly, the public.”The Minister added: “Over budgeting in addition to being an effective and strategic budget tool fosters more people engagement and participation in the country’s spending decisions.”Moving forward, he said: “There is room for improvement. The Government will drive fiscal policy and management by hard top down debt targets rather than by bottom up considerations whereby priority if given spending plans.“A judicious choice of debt targets almost always ensures that the debt sustainability criteria will be met as it is built in to the very design of that fiscal policy,” he said.In conjunction with the new debt ceiling he said new fiscal rules will be established to “keep public debt at such a level that the net debt to GDP ratio does not exceed 38 percent”.The goal will be to achieve “a net debt to revenue ratio that is below 80 percent and a debt service cost to revenue ratio that is below ten percent”.He pledged to “work towards reducing these ratios to the levels mentioned above to over the medium term by growing the economy, coupled with continuous cost containment”.“We have no choices and no choice but to wrestle this debt to the ground to more manageable levels,” said Mr Richards.“The state of Government finances unfortunately was every bit as bad as we had feared it might have been when we were on the outside. The trajectories of deficits and debt we found were simply not sustainable.“We cannot continue with debt rising at a rate of 22 percent per year. We can no longer tolerate the budget busting practices of the past.“We cannot continue to make excuses for our own failures to properly manage the public purse. Major changes have to be made in the way we approach the handling of public money,” he said.To that end he noted that a Public Policy Unit will oversee moves to “materially improve how we manage our public finances”.“More discipline will be enforced within Government in so far as budgets are concerned. Going forward, budget allocations to ministries and departments will be iron clad,” he said.“Ministries will be required to enhance their monthly reports of their expenditure versus budget allocation so that slippage can be arrested before they become problematic.”He noted that a new computer system is in place to help and that a Budget Implementation Group (BIG) will be established at the civil service level, that will be headed up by the Financial Secretary “to ensure that members of the civil service are motivated to deliver on the mandates of the budgets and the recommendations of the SAGE Commission”.