February 2022: Curtis Dickinson resigns as finance minister
February came with a shiver on the 14th with the resignation out of the blue of Curtis Dickinson as the Minister of Finance.
The move roiled the Progressive Labour Party government right at the home stretch to the 2022-23 Budget.
A congenial figure, with market savvy honed on Wall Street, Mr Dickinson’s shock decision to step down as finance minister ultimately pointed to a profound rift with David Burt over the financing of the crucial deal to get the Fairmont Southampton Hotel back up and running as the island’s biggest resort.
But at the earliest, Mr Dickinson gave no reason for stepping down.
That would not come until a personal explanation given to the House of Assembly in May – in which he criticised the Fairmont financing deal, as well as giving understated acknowledgement that news of his resignation would have been “received with surprise by many”.
The brief announcement that Mr Dickinson was stepping down hit a scant 12 days before the Budget was to go before legislators.
The blueprint for the year ahead would be a milestone event for Parliament regardless of the times.
But this Budget looked to be a harsh one, with the island once again lumbered with Covid-19 expenses and lost revenues – although the month had opened optimistically with the dropping of SafeKey restrictions, a move cheered by restaurant and bar owners desperate to regain business.
Tourism was making a sluggish comeback with the pandemic still depressing travel and the island anxious to boost air arrivals.
There were also widespread fears that Bermuda would get added again to the European Unions’s grey list of alleged tax haven – promising a headache for whoever held the finance portfolio.
Mr Dickinson had been tipped to become finance minister right from his June 2018 victory for the PLP in the by-election for Warwick North East.
A career banker, Mr Dickinson had proved adroit in the restructuring of the island’s debts.
Debt service, if made into a ministry, would have added up to the island’s third-largest.
Delivering the Budget on February 27 fell to the Premier, who took back the finance portfolio with Mr Dickinson’s departure.
It was a familiar role, as Mr Burt had assumed control of the country’s purse strings at the same time that he became Premier in the PLP’s 2017 General Election victory.
Mr Burt’s speech avoided mention of Gencom, the parent company of Westend Properties and owner of the Fairmont Southampton resort.
Net debt topped $3.19 billion – and the Premier warned MPs that the $945 million of current expenditure for the coming fiscal year would entail a “significant amount of reductions in services”.
But with net debt somewhat wrestled down from the previous year’s forecast, Mr Burt could tell the House of Assembly his administration would be able to “restore some measure of hope to the people of Bermuda”.
The pledge to cut duties on fuel imports and bring down electricity prices came at an especially welcome time.
Russia’s invasion of Ukraine on February 24 had not delivered the knockout hoped for by Russian president Vladimir Putin, who closed the month with an alarming step to put his country’s nuclear weapons on high alert.
The war and its accompanying barrage of Western sanctions on a massive exporter of oil spelled turmoil for fuel prices worldwide.
Mr Burt’s sweetener on fuel costs was well received, with one charity head hailing it as “a kinder and gentler Budget than perhaps anticipated”.
The Premier also promised to extend a holiday from payroll tax for hotels, bars, restaurants and nightclubs to get back on their feet.
Craig Simmons, an economics lecturer at Bermuda College and a regular commentator on the island’s economic health, said the Premier’s announcement of a one-year delay in balancing the Budget to 2024-25 came as no surprise.
Mr Simmons added that the delay had been hinted, since “no tax increases plus a marginal increase in spending suggests a deficit”.
“Given the Government’s past record, another deferment is not out of the question.”
Much of Bermuda’s recovery was predicated on clawing back government revenues, with a better summer for hospitality and tourism all but essential.