INTEREST will shift to the House of Assembly this morning where Prime Minister and Minister of Finance, Economic Affairs and Investment, the Honourable Mia Mottley, will be presenting her first Budget since her Barbados Labour Party formed the Government less than three weeks ago.

Prime Minister Mottley will be outlining measures the new administration intends on pursuing to bring some order to the Barbados economy, which registered a 0.7 per cent decline between January and March this year. Of equal importance could be details about the arrangement her administration plans to pursue with the International Monetary Fund (IMF), which was invited to send a team to the island last week for discussions with the Government. Those discussions dealt with ways the IMF can assist Barbados with its economic stabilisation and recovery.

The Fund’s officials have said that Barbados is facing multiple threats related, among other things, to low international reserves, low economic growth, high fiscal deficit and high debt.

“The Barbadian authorities, in close consultations with their social partners are rapidly developing a plan to address current economic vulnerabilities,” according to a statement by the Bert van Selm,” who headed the IMF team to Barbados.

The Prime Minister is likely to touch on the fiscal consolidation programme which Barbados has in place to curb spending while boosting revenue. However something is expected to be heard about the controversial National Social Responsibility Levy (NSRL) which the IMF said has not gone far enough. The IMF in its Article IV Consultation report had called for a strengthening of the programme. In particular, IMF officials who were here last week want to see more emphasis on the expenditure side of government’s operations, while the Prime Minister has said that the medium-term goal is to have a balanced budget.

It is concerning these, as well as more information on debt restructuring/debt profiling, and an IMF agreement among others which the public will be hoping to hear from the Prime Minister.

At a meeting with the Social Partnership, Mottley said that there is no avoidance in delay when treating with the economic and financial position in which we find ourselves.

She promised following a meeting with the Social Partnership that the initial expenditure and revenue adjustments will be ready to be detailed in the Ministerial Statement to be made within a short period of time. The Estimates of Revenue and Expenditure measures passed earlier in the year by the previous DLP Government put Current Expenditure at $4.5 billion, Revenue of $3.2 billion with a shortfall of $1.3 billion.

On the subject of debt, Mottley said that from June 1, her Government is suspending payments due on debts owed to external commercial creditors.

“Similarly, we will endeavour to make scheduled domestic interest payments. However, domestic creditors will be asked to roll over principal maturities until we reach a restructuring agreement,” she said while noting that Barbados’ has been in unsustainable territory for some time.

She said that while her administration is set on a course, it is not an easy one although it is the right path.

“To get there we need to invest in our people, our education, our health, our safety and our public infrastructure – the roads, the buses, water, sewage systems and garbage collection,” according to her.

She had also said that hope must be matched with real opportunities, opportunities to learn new skills, to find new jobs, to make new investments, to create new art and new music.

“We believe your Government can achieve these things by spending more wisely, in greater openness with the people, not by spending and taxing more,” she added. (JB)

THE answer to traffic congestion in this country lies in Barbadians making greater use of public transport and allowing the privately-owned transport sector to be an equal participant in the transporting of persons across the length and breadth of this country.

Interim Chairman of the Association of Public Transport Operators (APTO), Morris Lee, in a recent interview with The Barbados Advocate, indicated that proposals the sector put to the previous Government regarding the alleviation of traffic congestion, remain proposals they believe in and hope to put to the new Government for consideration. According to Lee, there are a few proposals being put forward, which can be used in tandem or separately to reduce traffic jams on the nation’s roads.

“There is potential in public transport to relieve this congestion that we witness every day. When the Democratic Labour Party first came to office, we discussed with then Minister of Public Works and Transport, John Boyce, the possibility of having a ferry service from Oistins to the Careenage, from Speightstown to Holetown and then Holetown to Bridgetown. I believe that we should be given the opportunity to participate in that venture, because we would hate to think that the Government would put that opportunity we asked for in the hands of large private sector interests,” he stated.

Lee added, “There is also an internal ferry system that I would like to see the Government participate with us on as well, which involves having a park and ride at Warrens and travelling underneath the Warrens Bridge and landing down by the River Terminal. There is a watercourse that goes underneath the road at Warrens. When you leave Warrens and head to Waterford you actually drive over a bridge, that bridge is over a watercourse that goes from St. Thomas down to the Globe and the Constitution River.”

The APTO official is suggesting that the watercourse be cleaned up and an electric train be put to run over the watercourse, but underneath the bridge and he noted it could be powered by renewable energy to help make it economically viable. To make it feasible for vehicle owners to put down their vehicles and travel on that train, Lee said Government would have to implement a park and ride system and construct high rise parking lots to accommodate the vehicles. He admitted that the venture could be a costly one to put in place at first, but felt confident that it would be one that Government would be able to get financing for and in which the private sector could also help to facilitate.

“So people would be able to park their car, catch the electric ferry and make their way into the City. That is one of the things I would like to see implemented. What that will do is alleviate a lot of the traffic congestion that we experience along those arteries that connect at Warrens. The fact is when you leave Warrens and are headed into town, you cannot escape traffic no matter where you go. If we can lighten up the road, the PSVs and Transport Board would still get business because not everyone owns a car,” he said.

The veteran transport stakeholder is also advocating for the road from Warrens to Eagle Hall into Bridgetown to be made a one-way and Tweedside/Roebuck Street by the old Globe Cinema to Warrens to be one way in that direction also.

“That would be like a huge roundabout and essentially all going down Green Hill, Codrington Hill into Bridgetown there would be no traffic going up, it would be all coming down traffic and to get out of Bridgetown you come up Station Hill, Waterford and back at Warrens. You would be surprised to see how quickly that can be done and while obviously there would be some tweaks and aches and pains in the initial stages, it is a workable idea,” he stated.

His comments came as he suggested that in each one-way scenario, a priority lane should be dedicated for buses, privately-owned public service vehicles and perhaps vehicles with full occupancy being used for carpooling purposes.

“You would be shocked at the amount of time you would save to get into town and if you have that kind of service running into and out of Bridgetown, it would help to create a new driver approach that would get rid of some of the recklessness we are seeing out there too,” Lee stated. (JRT)

PRIME Minister and Minister of Finance, Economic Affairs and Investment Mia Mottley yesterday launched what she said is the Barbados Economic Recovery and Transformation Plan, which will see a surplus of $182 million or 1.8 per cent of GDP by March next year.

The measures, which will see a mix of tax increases, tax reductions and removing some state bodies from off the Consolidated Fund, are aimed also at putting the country’s economy back on course.

Stating that the burden of the transformation will be shared by both workers, and owners of capital, Ms. Mottley admitted however that the measures will impact Barbadians, some of whom will need extra support.

“I also announce today a temporary increase in our poverty alleviation and welfare initiatives to the tune of $5 million,” she said.

She told the House of Assembly that there will be a lowering of Government’s recurring expenditure by at least $23 million by March next year. New capital expenditure for this year will be $134.5 million, and net revenue of $150 million.

The plan will be done in three phases, the first of which will be executed within the first three months of the new government.

It focuses on the imposition of user fees on domestic and international players to take three Statutory Corporations completely off and another partially off the Consolidated Fund. According to her, this will account for a reduction in expenditure of almost $215 million in a full fiscal year. The three corporations are the Barbados Tourism Marketing Incorporated and the Barbados Tourism Product Authority – $96.3 million; Sanitation Service Authority – $65 million; and a $50 million contribution to the Queen Elizabeth Hospital.

She promised that Phase One will also deal with a review of Barbados’ tax system to impose more effective taxes, increase compliance, and broaden the base between domestic and visitors to Barbados.

Phase Two (months three to 12 months) will focus on expenditure reduction through a review and analysis of government and state-owned enterprises focusing on the merger of potentially affiliated entities such as corporate Affairs and the Financial Services Commission, both of which receive subventions from government.

Phase Three will see a continuation of all remaining state enterprises and departments of Government. “We will determine what expenditure is essential, what is highly desirable and what is optional,” she said. Saying that Phases Two and Three will generate a further $200 million of additional revenues and expenditures, Ms Mottley said the net ‘impact of this mini-budget is to reduce the fiscal deficit in a full year by $182 million.’” (JB)

Deputy Minister of Foreign Affairs of the Republic of Cuba, Rogelio Sierra Diaz, is “very optimistic” about the future of diplomatic relations between Barbados and Cuba.

Speaking through Translator, Diana Mora, he made the statement to the media yesterday while at the Emancipation Monument in Haggatt Hall, St. Michael. There, he laid a wreath at the foot of the Bussa statue. This action was symbolic of the Barbados-Cuba friendship.

“Our two leaders will certainly work together in order to strengthen relations between the two peoples. That is one of the reasons for my visit here in Barbados. I have come to consolidate the ties between Barbados and Cuba. We are certain that the next few years would be very important in order to achieve those goals,” he noted.

Identifying areas where the two countries could further strengthen their friendship, Diaz stated: “There are many areas in which we can work together which are very important, such as addressing the effects of climate change and disaster risks. We will continue working with Barbados and the other countries of the Caribbean community, so that they can be compensated for the damages caused by slavery. And of course both of our countries have much to contribute to the unity of the Caribbean and Latin America, which is a very important relation. And so we can say that the future between our two nations is very promising.”

Yesterday’s wreath-laying was witnessed by Deputy Permanent Secretary of the Ministry of Creative Economy, Culture and Sports, Terry Bascombe, who joined the Deputy Minister of Foreign Affairs of the Republic of Cuba in laying the wreath.

Also present were Cuban Ambassador to Barbados, Dr. Francisco Fernández Peña; Director for Central America, Mexico and the Caribbean at the Cuban Ministry of Foreign Affairs, Jorge Luis Mayo; and local members of the Pan-African Coalition of Organisations (PACO). Chairman of PACO, Onkphra Wells, too laid flowers at the monument.

Barbados is one of the stops for Diaz and his delegation, who are currently on tour of the Caribbean.

Major changes are coming to the way in which two tourism-related government entities operate and the contribution made by the tourism sector in general to the public purse.

According to Prime Minister Mia Mottley, the measures are intended to save Government millions of dollars going forward. Speaking in the Lower House yesterday as she delivered the much-anticipated Budget, PM Mottley announced plans to, within less than four months, transition the Barbados Tourism Marketing Inc. (BTMI) and Barbados Tourism Product Authority (BTPA) into a public-private partnership. That plan, she disclosed, would save the Government as much as $96 million, an amount currently earmarked for the collective marketing and product development of the local tourism sector.

“The Government of Barbados will accordingly review the Governance arrangements, so as to ensure a transfer of lead responsibility to the private sector for the ownership and management of these entities. It will however still be a partnership because the Government will retain a minority shareholding and a golden share in the interest of ensuring fairness and equity to all players in the sector. It is anticipated that this transition will take place between now and October 1st. In order to facilitate the new institutional arrangements, it is intended to isolate the revenue that will be necessary to manage these institutions in the early years,” she said.

With that in mind, she announced that come October 1, this country will introduce an Airline Travel and Tourism Development fee, to be charged in addition to Departure Tax. Mottley said the fee to be paid by passengers flying outside of CARICOM will be US$70, and for those within CARICOM US$35 and will be placed on tickets purchased after October 1.

“It is anticipated that this measure in a full fiscal year will realise $95 million. $75 million of this amount will go toward the BTMI and BTPA and we are assured by the members of the Social Partnership that this $75 million can allow them to do as good, or better a job, in the marketing of Barbados’ tourism. Similarly, the $20 million remaining will go to Central Government towards the further regulation of our tourism product, civil aviation and our shareholder responsibilities, as a major shareholder, but not majority shareholder in LIAT,” she stated.

While acknowledging that some persons may be wary of this measure and the impact it could have on the sector, Prime Minister Mottley said Barbados would not be the first Caribbean country to introduce a similar tax on persons leaving the country. Using St. Lucia as an example, she said it did not result in a reduction of travel as some had anticipated.

The PM also announced additional taxes on the tourism sector, with the implementation of a room rate levy for an interim period. She spoke to this as she announced Government’s intention to increase Value Added Tax (VAT) on hotel accommodation from 7.5 per cent to 15 per cent by January 2020, allowing visitors to make a “small contribution” to assist in maintaining the country’s infrastructure, including sewage and garbage collection.

“We however accept from the tourism sector that to introduce this without a sufficient lead period will cause harm to our hotel sector, because of them being locked into contractual arrangements.

In our discussions with the Social Partnership, we have agreed that any such rate adjustment should be applicable from January 1, 2020. This will provide more than adequate notice for them to plan and adjust their contractual and marketing efforts accordingly. In the interim, Mr. Speaker, my Government will introduce a Room Levy to be applied to our hotel rooms,” she said.

Mottley announced that “B” Class and Apartments will pay US$2.50 per room per night; “A” Class, US$5.50 per room per night; and Luxury Class, US$10 per room per night, which is expected to earn $47 million for the Treasury. Additionally, she said Government will apply a 2.5 per cent Product Levy on all Direct Tourism Services, which will be collected on Government’s behalf by the providers of these services earning $3.9 million.

The measure, she added, also captures the shared accommodation sector namely Airbnb, Home Away and similar types of accommodation. She explained that the technology now exists for Government to collect Barbados taxes due on these online transactions and so Government will introduce a 10 per cent shared accommodation levy on all fees charged for the shared accommodation and it should garner $8 million. (JRT)

THE days of the controversial National Social Responsibility Levy (NSRL) are numbered. Come July 1, this year, there will no longer be a NSRL.

Yesterday Prime Minister Mia Mottley kept her campaign promise by removing the tax, while delivering her Mini Budget in the House of Assembly. Also being removed is the Road Tax, another campaign promise. She said that Government expects that the removal of the NSRL will “lead within two months to a reduction in prices for the average Barbadians”. In addition, the Social Partnership has agreed to help monitor the situation while the Fair Trading Commission will be asked to ensure that producers and retailers reduce their prices appropriately, including the related reduction in VAT.

The removal of the two taxes, however, saw some new impositions being announced as Ms. Mottley set about to bring the country’s fiscal deficit to at least one per cent by the current financial year.

She told the House of Assembly that the removal of the Road Tax will be replaced with a Fuel Tax to be levied at the rate of 40 cents a litre on both petrol and diesel, and five cents a litre on kerosene.

“The average motorist is unlikely to pay more under this new Fuel Tax than they paid in Road Tax,” she said.

The Prime Minister noted that improved collection means that the Fuel Tax is likely to raise $80 million while the combined Road Tax brought in $65 million.

There will be a new registration fee effective July 1, 2018, for the purchase of private vehicles (whether new or used) and $1 000 for commercial vehicles. The latter will still need to be registered annually, although they will only attract 50 per cent of the previous fees paid as Road Tax.

Mottley said as well there will be a new income tax band of 40 per cent in changes to the Income Tax system that are expected to realise $41 million in a full calendar year. Accordingly, the first $25 000 of income will remain tax free. However, incomes above $25 001 to $60 000 will continue to attract a rate of 16 per cent; incomes between $60 001 to $75 000 will attract a rate of 33.5 per cent, while the 40 per cent will apply to incomes above $75 000. (JB)

IT has been eight years in coming, but public servants have finally secured a wage increase.

Just two weeks in office, and the new Government has agreed to give workers a five per cent increase across the board. Word of the agreement reached between Government and the trade unions came from Prime Minister and Minister of Finance, Economic Affairs and Investment, Mia Mottley, who said that the increase covers the period April 1, 2018 to March 31, 2019. She stated this as she delivered the annual Financial Statement and Budgetary Proposal in the Lower House yesterday morning as she lamented that it has been the workers who have borne the brunt of the economic challenges over the last few years.

“Immediately on taking office on the 25th of May, I mandated that meetings be held with workers’ representatives to consider a new wages and salaries accord for public workers, who have not had a wages increase in this country for eight straight years. Prices have gone up in the last decade by almost 50 per cent and the meagre increase that they got between 2008 to 2010 does not even bring them to a proper quarter of what prices have gone up to in this country,” she said.

Prime Minister Mottley’s comments came as she noted that even though she wishes she could make up for the “lost years” that the previous Government put the workers “at peril”, her Government cannot agree to any increase for those previous years, and as such any union demand for settlement regarding previous periods cannot be met. Mottley made the point as she revealed that the five per cent boost in wages and salary for the public service will cost the Government approximately $60 million on a recurring basis.

“This cost applies not just to Central Government but also to statutory boards… This is by far the single biggest expenditure my Government will undertake in the next year. It represents our commitment to labour; it presents our commitment to the workers of Barbados, Mr. Speaker. It is an appreciation of their unflinching commitment to working through the challenges our country faces together and I want to salute their maturity and I say simply that those who would seek to make a mockery of their patriotism, would do well to go and check themselves again, because this is what is in the best interest of the country; recognising that if we have to set off on a long journey you have to give people breakfast, especially if they have not eaten for eight years,” she said.

Mottley also announced her Government’s intention to follow through with its manifesto promise to raise the minimum non-contributory pension from $155 to $225 per week as of July.

“Protection of our pensioners will cost the sum of $18 million. The relativities, Sir, will be maintained for minimum contributory pensions and survivor benefits and invalidity benefits within National Insurance Scheme and the National Insurance Scheme will treat to this expenditure separately.

We know that the measures announced today will impact all. Some people will need extra support and as such, I also announce today a temporary increase in our poverty alleviation and welfare initiatives to the tune of $5 million to be able to capture and support all who may fall through the cracks,” she added.

In respect of tuition fees for those attending the University of the West Indies (UWI), in keeping with their manifesto pledge, she said those fees will be abolished for undergraduates from the next semester. Additionally, she said those achieving Upper Second Class honours or higher, and those pursuing studies in areas considered to national development priorities will have their graduate studies at the UWI paid for by the Government. But the move is not without some cost to the students, as she explained that in return students will be required to contribute to the development of social capital by giving back a minimum of 100 hours in approved service to the country. The areas of activity, she said, will be agreed to by the Social Partnership. (JRT)

From the last quarter of the year, Barbadians will be contributing through the social security system, to the operating costs of the Queen Elizabeth Hospital (QEH).

Word of this came from Prime Minister Mia Mottley yesterday afternoon as she delivered her first Financial Statement and Budgetary Proposal in the House of Assembly yesterday. Coming just a little over two weeks since her party was swept to power in a landslide victory in the General Election, Mottley revealed that as of October 1, 2018 Government will raise a 2.5 percent Health Service Contribution to help tackle the mammoth healthcare bill in this country until a long term solution can be found.

According to her 1.5 percent of insurable earnings will be paid by employers and the remaining 1 percent of insurable earnings will be paid by employees and self-employed persons. Her comments came as she said that it is expected to raise $45 million in a full fiscal year, and $22.5 million for fiscal year 2018-2019.

“This will meet more than 25 percent of the budget of the QEH and we will make amendments to the appropriate legislation to ensure that the NIS may forward the collected funds to the QEH directly for the purpose for which it has been collected. What a departure from the NSRL [National Social Responsibility Levy],” she said.

The Mottley Administration’s move comes against the backdrop of years of talk regarding healthcare financing and Government’s ability to continue meeting those costs which account for a major portion of the annual expenditure of the country. As she addressed the Lower House, Prime Minister Mottley said her Government will not be in a position to settle the sustainable long term financing of our healthcare system until the final phase of the Barbados Economic Recovery and Transformation Plan which is being implemented.

“We Sir have to complete the appropriate review of all relevant studies, including those completed by the last Government which were not shared with us fully and which within two weeks we have been unable to do in as appropriate a time, in spite of us working full steam ahead and I apologise to the country for not being able to complete that. As a result we will not be in a position to settle the sustainable long term financing of our healthcare system until Phase 3 of our Plan,” she added.

Her comments came as she acknowledged that the demographics of the Barbados population, with a higher number of elderly persons, than persons entering the workforce and the significant increase seen as it relates to the incidence of Chronic Non-communicable Diseases, is resulting in the cost of public health care continues to rise at an unsustainable rate.

Prime Minister Mottley also disclosed plans to reduce the “tremendous” pressure currently being put on the Accident and Emergency (A&E) Department of the QEH. In the first instance, they will extend the opening hours of two polyclinics, Randall Phillips and Sir Winston Scott to a 24 hour basis, which she indicated will cost taxpayers approximately $3 million. Mottley did not put a timeline on this plan, noting that it would depend on the additional staff complement that has to be deployed.

The PM noting the inadequate space within the A&E, revealed that some $11 million has also been earmarked to facilitate expansion of that vital department both physically with respect to triage and the waiting lounge and in respect of equipment. She added that once the waiting lounge is finished, it will go out for public tender to be managed as a hospitality lounge, so that the loved ones of the patients have the best possible ambiance as they wait anxiously to hear of the patients’ wellbeing. (JRT)

Switching to renewable sources of energy is the best way that this country can avoid the pitfalls that come with the recent rise in oil prices.

This is according to the CEO of the Barbados Light and Power (BL&P) Company Ltd, Roger Blackman who spoke to the media after the National Workshop hosted by the Technical and Vocational Education and Training (TVET) Council on ‘Integrating Sustainable Development’ for TVET yesterday at their headquarters.

He stated that they have a fuel clause in place which was implemented to deal with those times when the price of oil and by extension, the price of electricity were to go up so that the utility would not have to go to the regulator every time the price of oil changed.

“Basically what happens is that the fuel charge – fuel clause investment that we have in place – was put in place because fuel prices which is the major input into the production of electricity is an import and it is very volatile – it moves up and down depending on oil prices – and in order to be able to operate as a business, those price changes and swings are recovered through the fuel clause and that was put in place many years ago in order to avoid utility having to go to the regulator regularly whenever the price of oil changes.”

Blackman said that they had also looked into financial hedges, which they applied for in the past and were not successful. However, they have revisited those reasons why they were not successful and tried to find solutions to them so that when they get an opportunity again, they can reapply for it. However, the best solution and the long term answer is to take advantage of renewable sources.

“So there are ways to manage that however, and some of the ways in the short term would be like fuel hedging – financial hedges – which is something that we have applied for in the past and we were unsuccessful the last time, there were many reasons that we were unsuccessful, we need to revisit those and try to address them so that we can look at it again when the window of opportunity arises; look at putting hedges in place that would smooth things out to avoid spikes. But the long term solution
really is to wean ourselves off of oil in the long term and to switch to renewables.” (PJT)

Barbadians will be paying more on their water bills from August 1.

That’s because Government will be introducing a Garbage and Sewage Contribution (GSC) to be levied through Barbados Water Authority (BWA) bills, which is expected to result in Government saving in the region of $65 million annually. This GSC, Prime Minister Mia Mottley says, will allow Government to remove the expenditure of the Sanitation Services Authority (SSA) from the Government’s budget, but she maintained it will remain a statutory corporation. Her comments came as she said it is likely that legislation will be coming to Parliament for approval to support the new levy. Mottley, who is also Minister of Finance, Economic Affairs and Investment made the announcement yesterday as she delivered the Annual Financial Statement and Budgetary Proposal in the House of Assembly.

“Households, Mr. Speaker will pay the equivalent of $1.50 per day for this Garbage and Sewage Contribution. Of that $1.50, $1.25 will go to the Sanitation Services Authority for the offsetting of its expenditure in garbage collection and $0.25 will be retained by the Barbados Water Authority as a contribution towards the maintenance of our sewage systems,” she said.

PM Mottley added, “In the case of commercial entities, their contribution will be 50 percent of their water bill with half of that amount going to the Sanitation Services Authority towards the garbage collection, and the other half remaining with the Barbados Water Authority.”

She made the disclosure while contending that it was unfair for only residents of Bridgetown and South Coast, connected to those sewage systems to bear all of the costs. As such, she stated that that fee will be reviewed, noting that the country is not isolated such that only those residents suffer when the systems are not operating at full capacity.

“We feel that it is necessary to review the fee paid by the customers residential and commercial, the sewage fee currently within the South Coast and Bridgetown, and after review we will determine for the country how best. But in the context of the new fees that I’ve just announced, it is my personal position that they ought to go, but in the absence of appropriate consultation with the Social Partnership, I am not prepared to announce it here today,” she said.

Mottley also announced that immediate remedial work that will cost approximately $15 million for the South Coast and $12 million for Bridgetown are being carried out. She explained that work forms part of Government’s $131.5 million capital expenditure programme that is being led by investment. Her remarks came as she revealed that the Vice President of the Canadian Crown Corporation was to be on island from yesterday to me with her and other members of Cabinet to discuss the long term renewal of the South Coast Sewage Plant and upgrades for the Bridgetown Plant.

She went on to say that the sum of $15 million has been allocated for the purchase of much needed garbage trucks.

“We also critically need to repair and buy new garbage trucks, public buses and purchase equipment for Ministry of Public Works, if you know what we have found you would cry. Barbados starts each day with about 15 garbage trucks and ends up at the end of the day with seven or eight…We need a minimum of 35 garbage trucks to service Barbados on a daily basis. This situation is untenable. We will seek immediately to acquire 15 second hand trucks within six to eight weeks out of Europe because the timeline for the delivery of new trucks is eight months we cannot continue with this situation for eight months,” she said.

Mottley made it clear that timeline was not speculative, noting that the previous Government ordered seven trucks in April, but they will not be delivered until November. She further indicated that the SSA will purchase a D9 tractor and a compactor at a cost of just under $3 million. She made the comments while noting that the SSA has been paying approximately $33,000 a week to a private company for the rental of those two pieces of equipment for over four and a half years. (JRT)

The proposals outlined in the mini budget presented by Prime Minister of Barbados and Minister of Finance, Economic Affairs and Investment, Mia Mottley, are being described by a member of the Democratic Labour Party as ‘economic foolishness’.

This is the view of DLP member, Dr. David Estwick, as he made a few remarks during a press conference, which was held at the DLP headquarters yesterday evening. Dr. Estwick described it as a flawed stimulus programme.

He noted that the Central Bank Governor in his May report indicated that the economy was on a declining growth path. Given the state of the declining economy, how then, he wondered, was it smart to increase taxation seemingly across the board?

“You cannot get more out of the economy that you would have gotten before because the economy is heading to a recession,” he said.

“In addition to that you would have gone ahead with a corporation tax increase, an airline tax and a tourism development tax increase, health care cost increase, income tax increase, water increase, accommodation in the tourism sector tax increase, online transaction cost increase; so I’m trying to understand how that marries and works with a declining economy, a shrinking revenue base?” he queried.

Dr. Estwick further expressed that he could not see, given the shrinking revenue base, how the Government intended to achieve any of the targets they set out to achieve.

“This is economic foolishness!” he exclaimed.

“In addition to that, when you go on the other side, which is the expenditure side, which is why I said it is a flawed stimulus programme, you increase cost in sanitation, education, healthcare, transport and roads and other expenditure of 8.7 million and obviously these additional expenditures being brought on and you do not have a sense that you can achieve any of those revenue targets given that the economy is reclining.

“I remember the then opposition saying that we were not reaching targets due to the increase of taxes, but yet you proceed to increase taxes even more and want to reach the intended targets,” he stated.

Dr. Estwick highlighted that the DLP accepted the fact that the BLP was in Government, but believes that it was their right to highlight and point out any shortcomings in the presented budget.

Barbados’ brand as a luxury destination may be diminishing its attractiveness to a large section of the tourist market.

Saying that such a brand may be prohibitive to the middle-income group, which makes up a significant component of the travel market, Opposition Leader Bishop Joseph Atherley questioned whether the promotion of the island as a luxury destination ran counter to its capacity to attract these indi-viduals.

“Imagine the thoughts of such a potential visitor, when he or she sees such luxury brand advertising. I believe in situations like that even Iceland becomes even more attractive to travellers from the UK than the Barbados market, which is promoted as a luxury brand. We have to find a way of dealing with that dilemma of selling ourselves in consonant with our value as a nation, as a destination, as a people and a product, but also being able at the same time to attract those who are lesser able to afford the luxuries implied by our advertising,” he stated.

Pointing out that Aruba attracted similar numbers to Barbados in the 1990s but now records over one million long-stay arrivals annually, Atherley emphasised therefore that the time had come to refresh this island’s tourism product as visitor numbers have stagnated to around half of this.

Speaking on the Airline Travel and Tourism Development fee, he outlined that this may end up doing more harm than good as the cost of travel is very high, particularly within the region.

“It is just about easier for you and I to get to Miami than to get to Antigua, in terms of the cost, and therefore one questions the wisdom, in a context where we want to see an enhanced sense of regional oneness, where we want to subscribe to regional integration and movement of persons as a very pertinent activity within that whole sphere, one questions the advisability of this hefty increase on departure tax.

Imagine the added expense for a travelling family,” he remarked.

In her mini-budget presentation on Monday, Prime Minister Mia Mottley said that come October, passengers flying outside of CARICOM will be charged $140.00 and those flying within CARICOM $70.00. This fee is in addition to the $60 Departure Tax.

He noted that there must also be consideration to the imposition that this fee will place on the already struggling regional airline LIAT. (JMB)

Head of the Barbados Private Sector Association (BPSA) says he does not anticipate Government giving any tax concessions to encourage private sector investment.

Chairman of the BPSA, Charles Herbert, was speaking during the Post Budget Breakfast event hosted by the Barbados Chamber of Commerce and Industry (BCCI) and PwC at the Hilton Hotel yesterday morning. He made the point while responding to a comment from Immediate Past President of the BCCI, Eddie Abed, that the Budget lacked measures to encourage investment in specific areas of the economy.

“One of the surest ways we can get to the finish line sooner is by growing the economy, but yet yesterday’s announcements had nothing about tax relief. There is $9 billion sitting in the banks and credit unions and so on earning 25 cents on a thousand [dollars]. I am absolutely surprised that the Prime Minister didn’t give some sort of tax relief to those who took the money and invested it in specific areas,” Abed said.

While noting that funds – some $10 million – have been earmarked for entrepreneurs through the Trust Loan Programme, the local businessman said he feels if persons were given a concession to write off an investment into a venture capital or start-up operation, the private sector could help to boost entrepreneurship and Government would not have to get involved.

“If we felt more investment needed to go into certain areas like EE [Energy Efficiency] or RE [Renewable Energy], I would have liked to have seen some tax relief in that area so that we could direct that money into that area. Yet there was absolutely no mention of that. Can we expect that would come in phase two, or phase three?” Abed queried.

In response to the question of new direct tax concessions to grow the economy, Herbert said in his opinion the answer was “absolutely no”, contending that there is not enough money around to facilitate it.

“I don’t think we should be looking for somebody to pay us to make an investment, I think we should be looking for an investment to happen easily and quickly and let’s try and design investments and make money on their own,” he said.

But, he suggested that Government’s promise to improve the ease of doing business in this country, should in itself help to boost the economy.

“What I believe we are going to get is those 30 windmills that have had their applications stuck for the last six years, I think you’re going to get those applications approved to start. Those Town Planning stuff, whether it is adding on a bedroom to your house or building a new hotel, I think you’re going to see that speed up. I think what you are going to see that grows the economy, is a change in the pace in which things happen,” he said.

Adding to his comments, Chairman of the Barbados Hotel and Tourism Association, Roseanne Myers, said that improving the business climate “does not require a dime to be spent additional”. Rather, she said, it requires brainpower and the will to do things better and faster.

“I believe that the Prime Minister has promised that as of next week the whole discussion on Town Planning will start, the whole discussion on investment will start and we are really chomping at the bit to get that first meeting to look at all of the projects that we can unlock, because growth is really where we need to focus. But we have some realities that we’ve had to face, but we can’t take our eye off the ball,” she added. (JRT)

President of the Barbados Economic Society (BES), Shane Lowe says in examining the Budget that was delivered earlier this week, in spite of the numerous positives, one has to ask ‘to what extent are the measures likely to reduce economic growth’?

He raised the issue yesterday morning as he spoke during the Barbados Chamber of Commerce and Industry’s Post Budget Breakfast Meeting at the Hilton Hotel, which was held in conjunction with PwC. While noting many of the positives of the budgetary proposals, Lowe said the potential negative impact on economic growth and the upper middle class income earners, is one of the drawbacks that should not be ignored. He made the point while referring to the introduction of the new income tax rate of 40 per cent, to be charged on income exceeding $75 000 and the health levy of one per cent that is to be paid through the National Insurance Scheme.

He added, “While the upper-middle income and higher income in terms of percentage of the population might be a smaller portion, they likely spend more than the lower income person, and of course they hire those persons as well. They might hire a gardener, or someone to do housekeeping; so to what extent does taking money out of their pockets hurt the same persons you’ve been trying to protect at the same time? And of course for the competitiveness issues in tourism, to what extent does that also have a negative impact on tourists?”

The BES president spoke to this as he said it is difficult to say what the impact would be of those measures, and we will have to wait and see what the outcomes will be. His comments came as he described the Budget as a “very important one”, as it seeks to close the funding gap and mitigate any impacts on economic growth which had already been negative up the first three months of this year.

“What the Budget did do is that it did reduce the need for new financing, so the Minister of Finance, the Prime Minister did note that the deficit should come down to about $140 million and that is before debt restructuring, she said including debt restructuring should get her to virtually a balanced budget with no new financing needs. I think that is particularly important, because once you’ve decided that you’re going to default on external debt and announce your intentions to restructure domestic debt, it is difficult to attract new financing if you are not paying people as scheduled. And what it does is also stabilise the very high debt levels in the interim,” he added. The economist added that another positive of the Budget is that it has sought to widen the tax net so that from a tax perspective, Government is “not attacking the same persons all the time”. As such, he explained that Government has shifted the burden, in relative terms, from lower income to the middle class and higher income persons and he said the abolition of the NSRL and the five per cent increase in salaries for public servants, should help persons on the lower end.

“You [also] have the new health levy which everyone will pay, but it will disproportionately benefit those at the lower income levels because those at the higher income levels tend to go to the private health care facilities [and] they have health insurance, while the lower income levels would tend to go to the hospital and polyclinics,” he added.

Meanwhile, Lowe lauded Government for introducing new funding models for some of the State-owned Entreprises. He said effectively taking the Barbados Tourism Marketing Inc., the Barbados Tourism Product Authority, the Sanitation Service Authority and to some extent the Queen Elizabeth Hospital off the Consolidated Fund should reduce Government expenditure greatly. He made the point while noting that improving infrastructure spending is also a step in the right direction. According to him, capital expenditure will now account for 3.9 per cent of Gross Domestic Product (GDP).

“Last year part of the massive improvement in the fiscal deficit was a reduction in spending on capital expenditure which was about 1.7 per cent of GDP; contrast that to let’s say around 2004 when we were spending about 3.4 per cent of GDP, you see that we have cut our budget virtually in half on those things, and those things are important because you need to maintain the infrastructure to be a competitive tourism jurisdiction,” he stated. (JRT)

Charles Herbert, Chairman of the Barbados Private Sector Association (BPSA) has described the Financial Statement and Budgetary Proposals, presented by Prime Minister and Minister of Finance Mia Mottley on Monday in the House of Assembly as “A clever Budget”.

He made the comments as he participated in a panel discussion yesterday morning at the Post-Budget Breakfast event hosted by the Barbados Chamber of Commerce and Industry and PwC at the Hilton Hotel.

Further, giving his take on the presentation, an upbeat Herbert was adamant that the Budget was not one of austerity as has been suggested by some persons. In fact, he contended that almost everybody in this society is going to have more income in the coming year than they had before, with the promised removal of the National Social Responsibility Levy (NSRL).

He made the remarks while telling the business community representatives present, that he has given the Social Partners the commitment that merchants will change their prices to reflect the abolition of NSRL, and that they will demonstrate the changes to the public. He warned that merchants’ failure to do this would be to break that “social pact”. Herbert made the point as he acknowledged that given the varied nature of businesses in this country, all will not be able to effect those price changes at the same time.

“The one thing that will make this a Budget of austerity for the man on the street, is if we do not reflect the reduction in NSRL… this is something that needs be passed directly back to the
population,” he said.

Herbert added, “By the time NSRL comes off and the public sector gets a wage increase and the pensioners get a wage increase, there’s going to be more income to cover the extra costs of sanitation than there is [now]. So this is not for our population an austerity budget, I can’t believe the labour movement called it such. But it is, one where the burden has been transferred so far to tourism and notice given to creditors,” he said.

He made the point while referring to Government’s decision last week to suspend debt payments to external creditors and the Monday’s announcement that new taxes and fees will be imposed on the tourism sector. In respect of the latter, he admitted that the heaviest lifting and heaviest risks have been put on tourism and they have the potential to dampen arrivals. Herbert told business executives in earshot that he believes that tourism is just the first sector that will be asked to do heavy lifting and that the others will be asked to play their part as the country seeks to get back on a strong growth trajectory.

“Remember this is not a Budget for a whole year, this is phase one; we’ve been promised that there will be a phase two which is the restructuring of the debt. So we haven’t just moved forward by $180 million, there’s still that to come and we’ve been promised Central Government and State-owned Enterprise reform. If anything we have been given a signal already with what’s happened to BTMI and SSA and the QEH, that there is a serious effort to change what our State-owned Entreprises cost this country. So I think for me – I am going to believe those promises for now. I am going to believe that I am going to be actively, that we are going to actively involved in that discussion, and I think for the next six months at least, we owe it all, to really work as if this is going to happen,” he maintained.

BPSA Chairman’s comments came as he spoke of the improved relationship between the Government and the other Social Partners. On that note, he pledged the private sector’s commitment to
work with the new Government.

“We have a Government now that the first Monday in office, the first item on her [Prime Minister Mottley] agenda was to meet with the Social Partnership and we didn’t meet for an hour, we met for three hours, and in those three hours we did more than in any eight-hour meeting than we did with the previous government. That was the first of four meetings and the paradigm has changed… Take the measures aside, we have been signalled that once again we are going to be seen as active participants in where Barbados goes and the challenge is on us to grasp it,” he added. (JRT)

Artistes from St. Vincent, St. Lucia and Guyana are among the top 25 that have been selected as semi-finalists for the International Bashment Soca Monarch competition.

This announcement was made on Tuesday during a press briefing held in the Conference Room of Yello Media Group.

Michelle Straughn of 4D Entertainment told the media that the response from artistes worldwide to the Yello-sponsored competition has been positive. There were “over 80 entries” to contest, which is in its third year. This is the first time artistes from across the globe could enter.

“The response we have gotten from the artistes around the world has been great. We have had submission from as far as Scotland. So you can see that Bashment Soca music itself is really getting out there in the world. We have had some entries from USA as well and obviously from the Caribbean including Trinidad, Grenada, Guyana, St. Vincent and St. Lucia… So the competition is good.”

The 2018 International Bashment Soca Monarch show is slated for July 6 and the winner is set to walk away with a grand prize of Bds$125 000.

The semi-finalists representing St. Lucia and hoping to make it to that round of the competition are DRC (Da’ Real Champ) who is singing “Balance Pon It” and Freezy with the song “Badang”. Meanwhile, the semi-finalists from St. Vincent are Sita with the song “Hammer” and Dynamite with “Brave”. The lone semi-finalist representing Guyana is Rubber Waist with “Jiggle It”.

The 2016 and 2017 Bashment Soca champ, Stiffy, is also a semi-finalist and his song is “No Boring Girls Allowed”. Other semi-finalists are Mole & Brucelee Almightee with “Aye” and Porgie & Murda with “Come Down”.

The remaining local semi-finalists are: Lil Rick with “Bend It”, Big Red The DJ with “Pelt Back”, Cooper Dan with “Boom Boom”, Enterprise Squad with “Issa Snack”, Jagma The Champ singing “Face Down”, Jah Reddis with “Bamm Bamm”, Jus D with “Manager”, Kadiem singing “Ben Ya Back”, Marz Ville with “Roughness”, Natahlee with “De Test”, Rhea with the song “Bounce”, S.K. singing “Despicable”, Scrilla with “OOH OOH”, Stabby with “Tongue Out”, Timmy with “Get Dibby”, Unda Dawg with “Booty Bounce” and Versewild with “Backway”.

Marketing Manager with Yello, Pam Roach, explained that members of the public have a chance to vote for the semi-finalists via the “mobile app, Yello App”. Voting begins on June 13 and concludes on June 19.

In the last year there have been several developments that have had or will have a significant impact on this island’s financial system.

Deputy Governor (Ag) of the Central Bank of Barbados, Michelle Doyle-Lowe, said these include the economy suffering a further loss of international reserves that requires a tightening of fiscal policy and a compression of domestic demand, and commercial banks being asked to increase their holdings of government securities from 10% to 20% of their domestic deposits.

She also recalled during the 9th Domestic Financial Institutions (DFI) Conference held at the Lloyd Erskine Sandiford Centre yesterday, that insurance companies with regional cross-border operations have been confronted by significant claims in the aftermath of the severe hurricanes; the accounting standard for provisioning against impaired loans changed as of the beginning of this year; and that the Government recently announced the suspension of external debt payments and the intent to restructure domestic debt.

“In particular, the impact of the new provisioning rules and the debt restructuring are uncertain, with the potential to compress the income of financial institutions. The on-going macroeconomic challenges require durable solutions for the public finances and the reduction of the debt burden. We are certainly mindful that these must be achieved while containing the impact on financial institutions, which have a fiduciary responsibility to depositors and investors and which serve the national interest by transforming savings into loans and other investments, in support of economic activity.”

The DFI Conference, an annual forum, provides senior officials from the Barbados’ financial sector with the opportunity to discuss issues that affect their operations as well as the wider economy.

Also reflecting on the twelve months since the last conference, Chief Executive Officer of the Financial Services Commission, Kester Guy said that it has become more apparent that financial systems are “morphing into a dynamic that is different from what we have been accustomed to.

“Whether the regulator chooses to respond or has the capacity to respond does not alter the transformation that is occurring before our eyes.”

According to Guy, innovation, technology, global standards, cross border access, the state of the economy and stakeholder demands are some of the examples that have introduced new risks for financial regulators to consider.

“We have sent signals of regulatory engagement for many years, as is the case now, and certainly this forum is such a form. It therefore implies that we cannot ignore the issues highlighted…While the reality is that we have not ignored the issues, the regulatory non-responsiveness at times might be because we ourselves are trying to grapple with or simply understand the issues; we are looking at how the regulatory toolkit can be appropriately tweaked, including legislative matters; and the need to thoroughly examine the issues to minimise the costs associated with regulatory errors.”

“These considerations are important for securing the resiliency of our financial architecture,” he stressed.

During the conference, the 2017 Financial Stability Report prepared jointly by the Bank and the FSC was launched.

This report provides an analysis of key financial system variables, assesses system-wide prudential indicators and examines the ability of the financial system to withstand economic shocks. This year’s report highlights that the financial system, though growing slowly, remained stable and is capable of absorbing sectoral shocks, however, there remains potential downside risks to the performance of the financial system. (TL)

THE Barbados Water Authority (BWA) is working with householders and commercial entities on the South Coast of the island, to ensure that they have adequate grease traps on their properties.

To date, Industrial Waste Inspector, Nicole Austin, says business owners especially have been compliant, as the BWA works with them to ensure that the size of their grease traps are adequate and they are properly maintained.

This comes as the BWA has indicated that the improper disposal of fats, oils and grease into the sewer network on the South Coast, has ultimately led to blockages and breaches and subsequent overflows, as experienced along the South Coast and in the Bridgetown environs. Austin, who is part of a team working on a project with householders and commercial businesses to eliminate fats, oils and grease in the sewer lines, recently explained a bit about what has been taking place.

“Fats, oils and grease is an internationally used term and they are generated when you cook… What’s happening with the system is that we need to educate all of our customers, householders as well as commercial (entities), that when you are washing up, sometimes the little food bits, all of these things are being found within the sewer lines. So you need to pay special attention to your grease trap, the same way you would for your garbage bin, when it comes time to get rid of your solid waste,” she stated.

“So your grease trap is what’s capturing your fats, oil and grease and it is up to you as the homeowner, to you as the commercial owner, to make sure that your grease trap is properly maintained. What we will be doing on our end, is making sure that the sewer line is maintained. So we will be doing our best to maintain the sewer network and we would like to encourage you to do your bit at your individual home or business,” Austin further indicated.

Austin meanwhile issued a reminder that grease traps are supposed to easily catch fats, oils and grease and should be easily accessible and easy to maintain.

“One of the concerns that we have in the inspection, is that we have a lot of grease traps that are hidden underneath storage. It’s in an area where persons like to maybe have the garbage bin or they would have storage or some other utensils or stuff for the restaurant itself. So we want to make sure that you know that the same way that you have your garbage bins and your garbage unit available for your maintenance staff, as well as the persons that are clearing your garbage, your grease traps also need to be accessible as well,” she stressed, while noting that the BWA is working with the entities to ensure they meet the required standard. (RSM)

Minister of Youth and Community Empowerment, Adrian Forde, is committed to turning this island’s community blocks into business centres.

Explaining the reasoning behind the ‘Building Blocks’ project, which is currently in its embryonic stage, Forde said that the blocks around the island would be developed in such a way that they become self-sufficient business centres to empower communities.

“We must be able to enfranchise Barbadians, especially those who would normally fall through the cracks. We have had a situation where for far too long those at the bottom of the spectrum feel neglected and we must as a government must embrace and develop those persons,” he stressed, while assuring that a paper on this would soon be placed on the desks of Parliamentarians.

Speaking in the Lower House earlier this week during the debate on the financial proposals, the minister said that once again the family concept of raising a child in Barbados must become a norm.

“Barbados must once again become a family. Barbados must not only be great, but be proud,” he added.

Pledging to use his office’s resources to tap into the young people’s talents, he expressed his support for the new Barbados Labour Party’s decision that young entrepreneurs would be able to bid on projects, such as pavilions and resource centres valued under $250 000.

According to him, this will lead to empowerment of the blocks.

“We would provide the wherewithal and the finances to ensure that young entrepreneurs, community practitioners whether the artisans, the persons who are involved at whatever level to be given the opportunity to bid for contracts, and once these are under $250 000. We would make sure they get a look in at these contracts. Business would be done differently in this country, because we understand that we must open the umbrella to encompass every single Barbadian and especially our young entrepreneurs,” he opined. (JMB)

AS Barbados stands on the threshold of tumultuous change, the country must make a call on its friends in the international community, including the United States of America, not for handouts, but to collaborate and partner with the nation as it continues on the path to sustainable development.

Minister of Foreign Affairs and Foreign Trade and Leader of Government Business in the Senate, Senator Dr. Jerome Walcott, said the relationship which Barbados shares with the United States of America is not only long-standing, but also a warm and harmonious one, as ties date back to George Washington’s visit to the island over 200 years ago and the Carolinas where the evidence and hallmarks of Barbadian cultural influences can be seen today.

“On January 17, 1652 at ‘Ye Mermaids Inn’ in Oistins, on the south coast of Barbados, the Treaty of Oistins was ratified. This treaty essentially put an end to the squabbling between the political and economic forces in Barbados and Britain.

“It also set out the terms and conditions for the future relationship between the two entities. Of more significance, that Treaty of Oistins contained a clause which would later be enshrined in the American Declaration of Independence,” Senator Walcott said as he delivered remarks at the US Embassy’s Independence Day celebrations, on Thursday evening.

The clause reads that no taxes, customs, imports or excise shall be laid, nor levy made on any of the inhabitants of Barbados without their consent in a General Assembly. Senator Walcott said this was the principle adopted by the 13 American colonies in 1773 when they dumped 342 chests of tea into Boston harbour, in objection to a British imposed tax. He said the concept of ‘No Taxation without Representation’, originating among the planter class in Barbados, clearly influenced the actions of the colonists in those 13 colonies.

“Our ties are therefore long-standing and strong and with future strategic alliances can only grow from strength to strength. Barbados, will as we have in the past, continue to work with the US on areas of mutual concern and interest not only in the bilateral sphere, but also regionally as well as multilaterally. For we believe that it is only with open, respectful and transparent discussion that there can be real and meaningful progress,” he said.

In delivering remarks, United States Ambassador to Barbados and the Eastern Caribbean, Linda Taglialatela, said through numerous initiatives, from hurricane preparedness to the recent Tradewinds exercise, the US is committed to making Barbados and its neighbours safer and more secure.

The Ambassador highlighted the US efforts to promote economic development through youth empowerment. She said one of the local organisations that she is proud to be affiliated with is the Nature Fun Ranch.

“We helped them purchase equipment for the jockey school, we are sending the director, Corey Lane, to the United States for a month-long professional development programme, and when the young men and women of the US Coast Guard ship Eagle were available for volunteer work, I sent them over to St. Andrew to do some painting, fencing, and trimming. I am over there so often, in fact, that I have two new friends: Charlie the goat and Wilbur the pig. If nothing else, I feel guiltier about enjoying bacon,” she said.

Ambassador Taglialatela also pointed out that the Embassy has been working with the successful “A Ganar” programme, which enabled dropouts or unqualified youth to become employable and positively contribute to society through training opportunities by strengthening partnerships with training institutions and employers to ensure that youth skills aligned with market demand.

“The US supported 350 students in nine schools with technical, vocational and life skills training,” Ambassador Taglialatela said. (AH)