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Govt will not rule out privatisation of some public services

Government is not ruling out the idea of privatising some public services.

At Monday's Chamber of Commerce breakfast briefing on the 2012-2013 National Budget, Digicel CEO Wayne Caines raised the topic of privatisation suggesting that privatising the airport and the ferries were among the measures Government should consider to raise revenue.

Asked through her press secretary whether Government should be considering privatisation given the economic downturn, the Premier issued a statement saying that Government would consider “partnering” with the private sector.

“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.

“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.”

Bermuda's ferries, which will cost $7.6 million to operate for a revenue of $1.3 million, are expected to lose $6.3 million by the time the current fiscal year ends on March 31.

And the Bermuda Post Office which costs taxpayers an estimated $15 million this year to operate and brings in just $5.4 million is among several other Government run revenue generating services losing millions of dollars.

Some $11 million of taxpayers money is expected to be drained by the bus service which brings in about $7.9 million and costs $18.4 million.

If Government got out of the business of providing these services and handed them to the private sector, the savings to the public purse during the current fiscal year would be close to $27 million.

Add in the costs of providing employee benefits and the savings are even higher.

Moreover, Government coffers would be boosted by additional payroll tax revenue.

Collectively, public buses, ferries and the post office employ about 550 people or just under ten percent of the total number of Government employees.

Airport operations is another big money loser, employing 46 people and costing over $20 million to operate while bringing in just over $11 million.

United Bermuda Party MP Kim Swan said that his party would be “keen” to discuss privatisation of “certain non-essential services” in Parliament.

“A start we already support would be legislation to establish a Tourism Authority,” Mr Swan said. “We note that in Britain Prime Minister Cameron's government plans to prepare a White Paper on privatisation of public services.

“Likewise, in the case of Bermuda such a decision beyond a Tourism Authority, would need the backing of the government and a comprehensive plan outlined in a White Paper.”

Government has not ruled out privatisation of some services. File picture.

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Published February 29, 2012 at 8:00 am (Updated February 29, 2012 at 8:55 am)

Govt will not rule out privatisation of some public services

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