Economist says Throne Speech short on details
Plans for the new session of Parliament could be hit by a lack of cash, a top economist warned last night.
Craig Simmons, a Bermuda College lecturer, added that last Friday’s Throne Speech lacked detail.
Mr Simmons said the speech was “ambitious”. He added: “It reminded me of the previous one, which was even more ambitious.“
He said: “It was ambitious about renewable energy and expanding the Economic Empowerment Zone and funding affordable housing in east Hamilton.”
Mr Simmons welcomed proposed building projects such as waste management upgrades and the development of a strategic plan for St George’ and said they were “long overdue”.
But he added: “Detail is another matter. As people are saying, it is light on the details.”
Mr Simmons highlighted that the Government was scheduled to repay a loan of several million dollars next April, with a further payment to be made in 2023.
He said: “They’re short of funds. A significant chunk is going to have to go to refinancing the debt. Ambition needs to be tapered.”
He believed the Government was trying to lower interest rates but questioned if that could be achieved.
Mr Simons said: “It sounds like they are trying to find ways of lowering interest rates, which is odd because they are determined by the Federal Reserve, which announced it will begin tapering at the end of this year.
“Interest rates are going to start rising from next summer, so it’s hard to understand how government is going to keep interest rates low if our biggest trading partner is going to be raising them.”
Mr Simons also appealed to the Government to let experts get on with their jobs.
He singled out Throne Speech remarks by the Governor, Rena Lalgie, last Friday on the need to respect independent institutions.
Mr Simmons said: “I took that to mean that you need to allow these quangos that you have set up and populated with qualified, chosen people, to allow them operational independence rather than meddling.
“There appears to be some government meddling – there appears to be some political interference and that doesn’t end well.”
Mr Simons added: “Similarly with the Regulatory Authority. It appears that it’s going to take legislation to get the authority to make changes to the fuel adjustment rate.
“The authority should have total oversight of the fuel adjustment rate.
“Belco has little incentive to find the cheapest fuel because it can always pass the cost on to the consumer.
“It doesn’t serve Belco well because it doesn’t bring discipline to the game.
“They should strike a deal with price caps. That will give Belco a high-powered incentive to reduce costs.”