2011/2012 Budget Debate Contribution Notes by Prime Minister Hubert Ingraham

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Nassau, Bahamas – The following are Speaking Notes for the Opening of Budget Debate 2011-2012 by the Rt. Hon. Hubert A. Ingraham , Minister of Finance delivered on May 30, 2011.

Mr. Speaker:

In presenting the Budget Communication last week I noted that Budgets are about making choices and accepting responsibility. During this fiscal year many persons were required to endure temporary sacrifices in order to preserve and sustain jobs in the public sector and to permit us to provide increased assistance to those most seriously impacted by the downturn in the economy, and take targeted action to stimulate job creation in the private sector through the acceleration of planned infrastructural developments and upgrades; which also has produced increased employment.

As the global economy has begun to turn around, so also has the Bahamian economy.  In this Budget we seek to relieve some of the burdensome sacrifices required over the past year, while remaining ever cautious to ensure the continued prudent management of our fiscal affairs.

Mr. Speaker:

Budget Allocations:

There has been some commentary in the press that this Budget does not address the too high incidence of crime in our communities most especially here in New Providence.  Of course nothing could be farther from the truth.  It is simply wrong highly disingenuous for others to suggest that they have a higher interest and commitment to fighting crime than does my Government or indeed any Government of The Bahamas.  Crime is an assault on us all and those who ignore it, tolerate it or indeed seek to benefit from it in any way are not friends of our people.

My Government has sought to avoid knee-jerk reactions to crime and criminality in our country.  Instead we recognize the necessity of a comprehensive approach to this very complex and vexing problem and so we have set out deliberately to address the factors responsible for the development of criminal behaviours and the criminal mind while modernizing and making more efficient the principal agencies responsible for the enforcement of the law, put extensive resources in place, developed new initiatives, fine-tuned existing anti-crime programmes and enacted legislation needed to more effectively prevent and combat crime.

We are keenly aware that prevention and deterrence also includes efforts in social development as well as targeted social intervention.

Contrary to the purposeful misinformation by some, my Government has continued to fund, to the tune of $2.3 million in this Budget, and make more effective and efficient various Urban Renewal initiatives.   This Budget provides funds to assist in the extension of various social intervention initiatives and the initiation of and expansion within existing institutions of innovative and effective programmes including for example, support for Marching Bands; after school programs; computer classes; sewing and handicraft programs for the elderly; summer programs for young people; boys and girls clubs; and backyard farming.

Further, we continue to provide funding to facilitate Parenting and healthy-lifestyle seminars and programmes meant to support and encourage entrepreneurship.

Presently, we have nine Urban Renewal Centres in New Providence and another seven in Grand Bahama.

All of these measures are designed to carefully target certain behaviours in order to prevent criminal conduct and disrupt those who have are beginning to engage in criminal enterprise.

Principally, the social interventions in which we will invest are meant to provide young people with positive and transformative life experiences, with lessons drawn from effective programmes with measurable results and success rates in various countries around the world including in North and South America as well as Australia and New Zealand.

Social Services

Among the social intervention programmes we are investing in and expanding are:

* Community service programmes in all public schools with an enhanced service-learning, ethics and character development component;
* Community and youth development programmes geared towards providing young people positive and alternative life experiences and skills while preventing anti-social behaviour;
* Effective and creative alternative sentencing for juvenile offenders; and
* Restorative Justice initiatives

Over the past four years my Government has:

* promoted a new generation of leaders for the Royal Bahamas Police Force
* improved conditions of service of the Police Force.
* invested in new equipment, technology and crime fighting tools for the Police Force
* implemented the electronic monitoring of accused and convicted persons released on bail
* introduced CCTV monitoring in various high-crime areas of New Providence  (played a role in the quick identification and arrest of suspects in the recent John Bull robbery)
* appointed additional Magistrates, Supreme Court Justices and Court of Appeal Judges to help facilitate speedier trials and reduce backload of cases
* engaged a new Director of Public Prosecutions mandated to reduce the backload of cases and streamline and improve the functions of that office
* introduced a new Magistrate’s Court to concentrate on gun crimes, and
* engaged this year 60 new police recruits who will be joined by another 60 now in training; 30 of whom are being engaged specifically for posting in the Family Islands.

Monies have been provided to accommodate the promotion of 135 police officers to complete the restructuring of the Force so that development is based on a structure.  For example, if Bimini is to be headed by an Assistant Superintendent of Police (ASP), then there must be an Inspector, Sergeant(s) and Corporals and Constables.

The introduction of CCTV surveillance in high crime areas and the introduction of ankle bracelets to monitor and track individuals charged before the Courts on serious offences but freed on bail are both programmes specifically implemented to combat crime and to keep Bahamians and residents safe.

Mr. Speaker,

We have inadvertently left off the list of new tariff reductions, surveillance cameras for business.  I will today table an Order so that surveillance cameras will be duty free in this new fiscal year.

Mr. Speaker:

I reaffirm my Government’s commitment to the administration of justice.

In order to bolster resources available to the Office of the Attorney General, this Budget contains funding in the amount of $549,000 to engage 9 Assistant Counsels, 3 Chief Counsels and one Senior Counsel.  Financial provision has also been made to facilitate and accommodate promotions for legal officers in the Office of the Attorney General.

Reform efforts underway at the Attorney General’s Office are meant to further reduce the backlog of cases in the Courts.

As regards the Department of Prosecutions:

* Prosecutors are now being involved early in the investigative stage for serious and complex cases1.
* The OAG is establishing a prosecutor’s case management unit to ensure the readiness of cases that are fixed for trial.  Prosecutors to be engaged are expected to be adequate to resource this effort.
* The OAG has launched a witness care unit in February 2011 to provide appropriate support service to victims and witnesses (witnesses being critical components of the justice system and essential to the prosecution’s case).

Even though, reasonably, time is required for the outcomes to be plainly manifested, there has been substantial progress in the justice system over the past several months.

I note that:

* The Magistrate Court hearing firearm offences have in the first 2 months since 07 Mar11 heard more than 180 cases (several of which are ongoing).
* The increase from two (2) to four (4) criminal trial courts in New Providence and a criminal trial court running consistently in Freeport have made it possible to meaningfully attack the long existing backlog of cases in the Supreme Court and to prevent the accrual of new backlog.
* New backlog is being prevented in the Supreme Court by the Chief Justice having assigned one (1) of the four (4) courts to hear current matters (offences committed in 2010 and 2011 to date).  Upon arraignment of a new case in the Supreme Court, it is now fixed for trial for a specific date (no longer assigned sine die where they drift un-managed in the system) and those trial dates have been less than eighteen (18) months.
* Another of the four courts is assigned to hear retrials ordered by the Court of Appeal or due to a hung jury.
* Two (2) courts are concentrating on older cases (offences committed in 2009 and prior).

Moreover, the trial dates for current cases are now within a reasonable time, thereby preventing new backlog.  This is a break-through of success compared with recent decades.

Our collective efforts are ongoing and we expect more milestones that would deliver a better functioning criminal justice system.

Mr. Speaker,

When my Government came to office in May, 2007 we found the infrastructure of the Supreme and Magistrates Court in a lamentable condition.

The Supreme Court operated from a principal building that was in dire need of refurbishment. The Hansard Building was such that the resident judge later refused to continue to work from it. And, work on the Magistrates Court Complex off Nassau Street had come to a complete halt.

As I present this Budget, Members and the Bahamian public can see the Governments investment in improving infrastructure around the country and very dramatically in New Providence.

As regards the physical condition of our Courts I note that the refurbishment of the Court in the Hansard Building, which was vacated when a Senior Justice found it impossible to sit there any further, will be completed by the end of June. It will become fully operational soon thereafter. That court will be able to accommodate both civil and criminal trials and will be equipped with a Judge’s Chambers, a secured jury room as well as witness rooms to insulate witnesses from interference from the public.

The Government purchased Ansbacher House last year to accommodate additional courts for the Supreme Court.

The work on the ground floor of Ansbacher House, to accommodate two courts capable of both criminal and civil trials is expected to be completed by the end of September of this year.

After they are completed, the main Supreme Court and the rest of Ansbacher House will be vacated. Work will begin on those buildings for the creation of the other courts capable of criminal and civil trials only. When these works are completed the Supreme Court in New Providence will have eleven modernized courts six of which will be capable of the conduct of criminal trials and large enough to accommodate those large civil litigation cases which our complex and sophisticated economy sometimes requires.

Even with our inadequate facilities we have this year operated four courts (two more than previously) in New Providence and one court in Grand Bahama devoted primarily to the adjudication of criminal trials.

The Supreme Court presently has a full complement of 12 justices and we have provided additional funding for the temporary appointment of an additional justice to deal primarily with criminal cases.

When we came to office in May, 2007 there were only three justices on the Bahamas Court of Appeal. Two vacancies had been allowed to continue unfulfilled for months and in one case for more than a year.

Today the Court of Appeal has a full complement of 5 justices. In this Budget we have provided funding for an additional Justice of Appeal to permit the Court to sit in two panels at the same time, as well as to expand the number of justices from which a panel may be selected.

As to the Magistrates Court, the work on the new Court Complex is nearing completion.  That impressive edifice when completed will house twelve Magistrates courts. There are presently nine Magistrates Court that operate in New Providence, excluding the two night courts. This complex will enable us in time to have twelve courts operating in New Providence every day.

When completed and operational before the end of this year, the Complex will house scores of full time staff and will no doubt help to revitalize the Nassau Street area providing opportunities for residents in the area to establish small businesses to meet the needs of those persons work in the complex or utilizing its services.

This Budget also provides additional funding for another Magistrate in New Providence. Whilst it is a matter for the Chief Justice and the judiciary how Magistrates are deployed, we have made representation to them as to the need for an additional court dedicated as a priority to Voluntary Bills of Indictment and Extradition.  There is also a need for additional magistraterial resources to address the growing demands of domestic disputes.

The Budget provides additional funding for two new Magistrates to permanently reside in two of our major Family Islands. For too often the residents of family islands are short changed in their right to a fair trial within a reasonable time because of the absence of regular and consistent services of a Magistrate.

Presently resident Magistrates are only found in Nassau, Freeport, Eight Mile Rock, and in Abaco.  In Abaco, two new Courts are located in the Administrative Building.

We have provided additional funding in this budget to appoint two new Magistrates to reside in Eleuthera and Exuma. The appointment of these two new additional resident Family Island Magistrates will in our view significantly improve the provision of these services to the residents of these islands.

Mr. Speaker:

I have finally been convinced that efficiencies to be derived from the establishment of a Remand Court on the grounds of Her Majesty’s Prison in Fox Hill outweighs my long held view that individuals held on remand ought to have their day in court in a place away from the place of  their detention.

Honourable Members are aware that the transportation, daily, of large number of prisoners from the prison in Fox Hill to Courts located in the centre of the City of Nassau to have their Remand Continuance hearings occupies the time and attention of many Police and Prison Officers who might be more usefully and effectively assigned.  Further, police escorted Prison Bus convoys are increasingly becoming not only an annoyance to neighbourhoods traversed by the convoys but also a danger to pedestrians and to regular vehicular traffic.

The construction of a Remand Court at Fox Hill will eliminate the need for persons being held on remand to be transported. Instead only those persons whose trials are scheduled will be transported downtown.

The court is being built adjacent to the Electronic Monitoring Tagging Centre.  Remanded inmates will continue to have ‘their day in court’ before a Magistrate and in the presence of family members should they so choose.   The Remand Court will have teleconferencing capacity to permit and facilitate Remand Continuance Hearing in the event that a Magistrate cannot attend in person.

It is expected that the Remand Court will be completed by September of this year.

Mr. Speaker:

I am pleased to advise Members that the Probate and Administration of Estates Act enacted by Parliament last year will come into effect this Wednesday, 1st June, 2011.

And we will also further amendment to the Bail Act to reduce the number of violent offenders and accused persons out on bail who seek to do harm to others. And, in coordination with non-governmental organization we are actively reviewing the implementation of various alternative sentencing and restorative programmes to reduce crimes and repeat crimes by juvenile non-violent offenders.

Mr. Speaker:

Crime and its causes are complex.  The stark reality is that we did not reach the current level of crime overnight.  And, our attitude towards crime makes a difference.  Complaining about crime yet aiding and abetting criminal behaviour hurts our shared fight against crime.

The less tolerant and accommodating we are of criminal enterprise and behaviour, the more effective will be our fight against crime.  The entire society has an obligation to assist the Police in doing their jobs.

And I say to both political parties, both the FNM and the PLP, that we ought to consciously not associate ourselves with persons that we know to be criminals. You ought to concsciously disassociate ourselves from persons we know to be criminals. I know in elections, everybody wants to win, but we ought to concsiously and deliberately disassociate ourselves from persons we know who are criminals. I speak in my capacity as Prime Minister, with the knowledge I have from intelligence gathered in The Bahamas.

As demonstrated by our actions, my Government’s anti-crime programme is comprehensive, covering immediate-, medium- and long-term measures to address crime and its causes.   We have invested heavily and without stinting in the police, courts and corrections.

In the coming month I will make a national address on crime so as to keep the public informed on even more that will be done to ensure the peace and security of our persons and properties.  The people of The Bahamas should have no doubt as to this Government’s commitment to cause a reduction in criminal activity and improving the administration of Justice.

Mr. Speaker:

Even a cursory look at the 2011-2012 Budget estimates reveals that this Budget, consistent with each of the budgets introduced by my Government during this term in office, is committed to the immediate and long-term protection of Bahamian national interests and the security of the Bahamian people.

That protection includes:

* Economic Security inclusive of Job-Creation and Job Protection;
* National Security inclusive of Public Safety and Crime Prevention;
* Social Security and Protection inclusive of Social Assistance to our more vulnerable citizens.

My Government continues to pursue measures to enhance job and income security and social protection.

These measures include the launch of an earlier very successful National Training and Retraining Programme in 2009 which trained 800 many or most of who whom were subsequently placed at various enterprises around our country, the 6 month Employment Programme which productively engaged 2,500 individuals and an electricity subsidy of $4 million for more than 6,000 household which permitted them to have their homes reconnected to the electricity supply.

My Government’s social security and protection initiatives include the launch of the landmark unemployment benefits programme and the national prescription drugs benefits programme, which has now been extended to public officers.

Mr. Speaker:

As crime cannot and will not be solved by Government alone, my Government continues to with and strengthen partnerships with civil society generally, and churches, civic groups and the business community to fund and manage targeted social intervention programmes to confront anti-social and criminal behaviour among various groups.  Some of these organizations were required to accept a slightly reduced Government Grant last year.  These are now being restored to the 2009/2010 level.

Mr. Speaker:

Apart from Government’s considerable formal investment in education, training through the Ministry of Education, I also highlight a few key expenditures meant to provide targeted support for our youth and students for the information of Honourable Members:

* Government’s subvention to College of The Bahamas has been restored to its 2009/2010 level of $24.7 million;
* Funding for Scholarships, which was increased from $400,000 in 2006/2007 to $1 million in 2007/2008; further increased to $6 million in 2009/10, increased again to $7million in 2010/11 and is now further increased to $7.750 million.   And, an additional $1 million provided in this Budget to fund the interest subsidy for Education Guarantee Loans related to Government’s contribution to educational loans.

I was disappointed to know that the allocation of $2 million in each Education Budget meant for subsidies for education loan repayments were not being applied as I intended.  Our predecessors in office stopped the payment of the one half of the interest cost of all student loan payments while the student was still attending college or university.  We pledged to restore this.  This will happen on July 1, 2011.  Further, I will direct that a review be undertaken of all student loan repayment meeting this criterion so credit may be given in respect of all payments made since July 1, 2007.

Mr. Speaker:

Continuing with the list of some of the key expenditures meant to provide targeted support for our youth and students, I draw attention to the following:

* Government’s contributions to sports, civic and youth organizations are being increased
* Subventions to Family Island Regattas, the National Endowment for Sports, Aid to Athletes, and National Youth Leaders
* The Self-Starter Programme introduced in 2007/2008 will be funded at the level of $500,000 (up $50,000 over last year).
* And, the subvention to the Bahamas National Trust which was increased 9 fold to from $100,000 to $1 million in 2007/08 and reduced to $750,000 last year has been restored to its 2009/2010 level.

Mr. Speaker:

Today we have cautious optimism that the economy is rebounding.

Our targeted infrastructural development projects are progressing well, some completed or nearing completion during the last budget period and others on their way to completion during this calendar year.  I note in this regard:

o Phase II redevelopment of the old US Departure Terminal into a new International Departures Terminal is underway following upon the completion of Phase I.  At present there are more than 100 Bahamians engaged on this project but as with Phase I, between 500 and 600 Bahamians will be engaged at the peak of the Phase II development of the new International Departure Terminal project.
o The new $70 million Port at Arawak Cay. Some shipping operations have already commenced services. Bids are now in and a contract will soon be awarded for warehousing and customs facilities at Gladstone Road.  Upon completion, now expected by year’s end, all international freight and the associated traffic congestion will finally be removed from Bay St.
o The new $12 million Straw Market will become operational by August/September of this year;
o The new multi-million dollar Government Administration complexes are nearing completion in Grand Bahama and Abaco;
o Two Gymnasiums will be constructed in this Budget period – one in Central Abaco and the other in Central Eleuthera;
o Additional classrooms are scheduled to be constructed at schools in Inagua, Mastic Point, Andros and Spanish Wells, a contract has been issued for work on classrooms at the Bight, as well as work on new classrooms at AF Adderely High School, CH Reeves  Senior High School and an Administrative Block at RM Bailey Senior High School;
o Finally, the TG Glover School will be completed and opened in September of this year;
o Two small hospitals are to be constructed by NIB, one in Abaco and the second in Exuma
o And the extensive and continuing road, utility and other infrastructure work here on New Providence and on a number of the Family Islands:

o new docking facilities will be built in Fresh Creek, Andros; bids for this project are scheduled to be opened tomorrow – Tuesday

o two bridges in South Andros – at Little Creek and at Deep Creek are to be restored
o the Three Mile Island Dock in North Eleuthera is to be built at a cost of some $3 million
o the causeway connecting Little Abaco and North Abaco will be replaced; a new bridge will be constructed in its stead and the marine environmental degradation occasioned over the past 50 years will be remediated;
o new roads in Marsh Harbour, Dundas Town and Murphy Towns, Abaco and in North Andros will be undertaken
o the Treasure Cay, Abaco airport runway will be resurfaced; it having not been repaved since its construction in 1982;
o works will be undertaken at the airport at Deadman’s Cay, Long Island; and
o Finally the terminal and control tower at the Marsh Harbour International Airport (the 3rd, and possibly the 2nd busiest airport in The Bahamas) will be constructed at a cost of in excess of $25 million and a contract will be awarded during the course of next month (June.)

In the private sector multimillion dollar renovations and expansion were commenced at BORCO and Statoil in Grand Bahama.

And, the luxury hotel and residential resort developments at Albany in New Providence and at Winding Bay and Baker’s Bay in the Abacos continue to enjoy robust sales.  Some 500 Bahamians are engaged on the two Abaco projects. Some 321 Bahamians are now employed in the operation of Albany additional numbers of Bahamians continue to be engaged on construction works.

The important ongoing $100M renovation and upgrade project at Kerzner International properties on Paradise Island continues with acompletion date slated for December of this year.   Further, Kerzner International expects to commence the development of its new Timeshare Resort and expansion of the Hurricane Hole Marina this year.

In February the $3 billion Baha Mar Resort redevelopment broke ground on Cable Beach.  Work on the deviation of West Bay Street is already advanced. The new diverted West Bay Street will connect with JFK Drive via a new connector road extending to the intersection with Gladstone Road.

Also, the replacement Cable Beach police and fire station and other replacement private office structures to form a nucleus of the planned Baha Mar commercial village are progressing well.  I am advised that as many as 700 Bahamians are presently engaged in several of the Baha Mar related construction and road contracts.

In the coming months hundreds more and eventually thousands more Bahamians will be engaged on this project.  And Bahamian contractors will be awarded contracts of a value of not less than $400 million.

I also advise that as a result of the sale of the Cecil Wallace-Whitfield Centre to Baha Mar, the Government has contracted to acquire the S.G. Hambros Bank Building at Goodman’s Bay for the sum of $13 million net.  The building will be renamed in honour of the late Sir Cecil Wallace Whitfield.  The Ministry of Finance and the Office of the Prime Minister will relocate to those premises before the end of this calendar year.

Mr. Speaker:

The New Providence Road and Utility Upgrade Programme will be completed during this fiscal period.  Some 470 Bahamians are currently engaged on these works.

Already the New Providence Highway, extending from the round about at Saunders Beach in the north to the Tonique Williams-Darling Highway in the south has been opened to vehicular traffic.  This new highway connects with the Milo Butler Highway extending the thoroughfare to Carmichael Road in the far southern end of the island.  It is envisaged that this highway will eventually extend further south to Cow Pen Road.

Measureable improvement in south to north traffic flow is being achieved and the construction of the 6-legged roundabout at the intersection of the new highway with JFK Drive and Farrington Road has also significantly improved traffic flow into the Oakes Field area.

Work is moving toward the completion of the following segments of large projects by end of this calendar year:

1. Major road works, utility upgrades and installation of sidewalks and improved street lighting along Blue Hill Road south of the water tower on the hill, Blue Hill Road North, Market St. South, Abundant Life Road, Prince Charles Drive, Marathon Road and Wulff Road to the round about at the intersection with Village, Bernard and Soldier Roads.

2. The installation of a new 24 inch water main is already completed along Robinson Road though road works continue in the area of the RM Bailey Sr. High School and Marathon Mall and is continuing along Prince Charles Drive up to the intersection with Fox Hill.  The completed project will bring improved roadway with sidewalks and also improved water quality and pressure for residents at the eastern end of the island.

3. The installation of a new water main along Soldier Road will also improve water quality for communities along that corridor.  The Soldier Road work is being undertaken in stages and at night and excluding weekends so as not to contribute to further congestion during high traffic periods.

Mr. Speaker:

The Bay Street Water and Sewer Rehabilitation Works are segmented beginning at Marlborough/Nassau Court and extending to Parliament Street, from Parliament St. to Victoria and finally, from Victoria Avenue to Mackey Street.

Additional road and intersection improvement work is also scheduled for a number of street junctions along the East Bay Street corridor: East Bay/Village/ Shirley St; the East Bay/Newgate; East Bay/Johnson Road; East Bay/Fox Hill Road; and also at the William/Shirley Street intersection.

Mr. Speaker:

Two other major road and utility upgrade projects which

have commenced will continue during this new Budget cycle.

The first entails:

* An enhanced entrance to the Sports Centre from Thompson Blvd.  This road way will be linked to the Tonique Williams-Darling Highway along an enhanced Yellow Elder Way;
* A new road extending from a new round about at the Government High School that will link the QE Sport Centre with the New Providence Highway.
* An extension of Moss Road linking Thompson Blvd and Blue Hill Road, and a new connector road linking Moss Road to the round-about at the Government High School.

Considerable new parking areas, drainage systems, and landscaping and open green spaces will be developed throughout the entire area.

So as not to increase the inconveniences being experienced along project routes the improvements to the road leading to the Government High School will not commence until after the end of the school year and it is expected that the works will be completed ahead of school opening in September.

The second of these major road projects to be completed during this next fiscal period is the Airport Gateway Project.  This project which involves the dualling of the exiting JFK Highway from the LPIA up to six legged roundabout will shortly be in execution.

Also telecommunication and cable infrastructure will be relocated, together with other ancillary works including drainage, signage, road markings, street lighting, and extensive landscaping.

Mr. Speaker:

Among the two most popular traditional beach-recreational spots for Bahamians on New Providence are Montagu Beach and Saunders Beach.  This Budget makes provision for their restoration and expansion.

Honourable Members will be aware that the 2003 Heads of Agreement concluded with Kerzner International included an option for the developer to construct a golf course on Athol Island.  In consideration of that concession from the Government, Kerzner International undertook that if they were to proceed with the development on Athol Island, Kerzner would undertake extensive restoration works at the Montagu Beach, restoring the sandy beach destroyed over the years as a result of hurricanes and other undetermined natural and or manmade events.

Notwithstanding that the development at Athol Island did not proceed Kerzner International has agreed carry out, at its cost, the proposed restoration works at Montagu Beach.  The necessary engineering and environmental studies have been completed and we expect restoration works to commence at Montagu in the very near future.  As the works are extensive, it is proposed that they be undertaken in stages resulting in only the partial closure of beach access throughout the life of the project.

Other landside enhancements will also be undertaken in collaboration with intersection upgrades at Eastern Road and Shirley St. to better improve access and parking to the fish vendors at Montagu Beach.  It is expected that this will finally address the congestion which has for so long inconvenienced beach-goers and Montagu and residents of the eastern end of New Providence

Honourable Members know that Saunders’s Beach is being transformed into a beautiful seaside recreational park.  While some have opined that the rest room facilities being constructed at Saunders Beach are “too expensive” and perhaps “too good” for Bahamian beach-goers as “a toilet is a toilet”, I wish to state that my Government is determined to provide for Bahamians, recreational facilities of a standard deserved and indeed expected by Bahamians at this stage of our development.  It is my expectation that we will provide such superior rest room facilities at other of our public parks. It has been my experience that when people are treated with respect they respond in kind.  This Government will always treat the Bahamian people with respect.

Honourable Members know that the beach at Saunders has suffered erosion over time particularly at its eastern end where a protruding rocky shoreline has long obtained. While the centre and western end of the beach appear to be enjoying considerable accretion following the year’s usual winter storm erosion, the eastern end of the beach remains bare with little promise of summer beach accretion.

I am pleased therefore to advise that the same coastal engineering expert who conducted the studies and prepared the working drawings for the beach restoration project at Montagu Beach, has, at no cost to the Government,  provided similar studies and working drawings for beach restoration and expansion at Saunders Beach. The Government has now determined to engage the engineer on a consultancy basis for the Saunders Beach Project.  This Budget makes provision for the cost of the works at Saunders Beach.

I am pleased to advise that the Ministry of the Environment, and the Ministry of Public Works and Transport are scheduling two town meetings on June 6th and 7th – one in the east and the other in the west, to inform residents and users of those two beaches of plans for restoration and expansion of the beaches.

We expect shortly thereafter to commence work on both projects simultaneously.

Mr. Speaker:

I note that this Budget makes provision for a number of specific Capital Works Projects to which I will draw attention as follows:

Head 21 – Reinstatement of Sundry Constituency Projects – each Member of Parliament entitled to $50,000

Head 31 – Ministry of Works and Transport – Provision of $1million for the construction of Grand Bahama Fire Station and $1 million for the fish and vegetable vendors in Eight Mile Rock, Grand Bahama.

$10 million for the Construction of the Marsh Harbour Airport.

I also draw to Honourable Members’ attention a number of other important infrastructural developments which my Government is completing and or undertaking during this Budget Period with the assistance of funding made available from the European Union and the China Export Import Bank as follows:

EU Funded Projects

Ragged Island (Gun Point) Harbour: This project is being executed by Emile Knowles Construction and is valued at $7.08 million.  The project along with the Ragged Island Roadway Construction and Airport Rehabilitation was started during the last fiscal period.   The latter two projects are largely completed and the Harbour Project has an estimated completion of October 2012.

North Acklins Road Rehabilitation:  This $7.3 million project (50% funded by the EU) is largely complete with only remedial work being carried out.  The contractor was Bethel Construction.

I also advise that my Government has indicated to the EU that it would wish the 10th EDF funds (approx. $4.5 million) to be allocated to a water project in Long Island.  This expenditure is not reflected in the Budget as the executing agency would be the Water and Sewerage Corporation.

Chinese EXIM Bank Funded Projects

China Harbour Company is in discussions with Ministry of Public Works and Transport with respect to Abaco Port, North Abaco Port and Bridge and the Glass Window Causeway.  It is expected that one of these projects will commence within this calendar year and a second will within this fiscal period.

Mr. Speaker:

When my government left office in 2002, we had completed a review of the overall Health Sector Infrastructure Plant in The Bahamas.  That study provided important information for setting the new strategic directions for our Healthcare System for the next decade.

When my government returned to office in 2007, a deliberate focus was given to improving the quality of healthcare delivered by the Public Healthcare facilities in the Commonwealth of The Bahamas and specific attention was placed on the acute care facilities, the Princess Margaret Hospital, which is the nation’s largest healthcare facility, the Rand Memorial Hospital in Freeport Grand Bahama, and the Sandilands Rehabilitation Centre, the only facility dedicated to the treatment of mental disorders and geriatric care.

Mr. Speaker:

My Government is continuing to demonstrate that healthcare is a basic human right. We believe that the healing process begins when healthcare services are provided in pleasant surroundings which are safe; built for and conducive to the delivery of efficient, effective and high quality healthcare, and staffed by committed, well-trained personnel.  So, we shall continue our investment in the infrastructural enhancements and development of our public hospitals and community clinics so that all persons residing in and visiting our country can be assured that they will receive quality health care.

In this regard, my Government began several major Capital Development Projects within the Public Hospitals Authority, at a total estimated construction cost of more than Sixty Million Dollars.

The largest of these projects is the planning and construction of a world-class Critical Care Block at the Princess Margaret Hospital. The construction of this new facility will represent the single largest investment in healthcare in this country since the PMH was built nearly six decades ago. This New Wing of the hospital will entail a three (3) storey building consisting of approximately 70,000 square feet. It will house new suites of Intensive Care Units for both adults and children; six new Operating Theatres; new clinical Laboratory facilities, a modern sterile supplies division and other support services.

This major capital investment is estimated to cost approximately 37 Million Dollars. The Functional Programming, Architectural and Master Planning will be completed within the next week and it will go out to Tender in June of this year, with construction scheduled to commence in September 2011.  The target completion date is March 2013.

I am also pleased to report that the first phase of the Expansion and Renovation of the Accident and Emergency Department at the Princess Margaret Hospital, has been completed. The second phase will begin later this year with the relocation of the General Practice Clinic to a new facility on 4th Terrace. Members may be aware that the first phase of this project was designed to re-organize and renovate 2,500 square feet of existing public areas (including triage, waiting area, reception, holding room, bathroom and a new 900 sq feet for screening and security entrance) was completed in December 2010. The total budget for this project was $320,000.

The second phase of the Accident and Emergency expansion involves the renovation and preparation of rented space on 4th Terrace to accommodate the General Practice Clinic.  It is anticipated that the relocation of the General Practice Clinic will reduce the number of patients seeking care at the Hospital as non-urgent cases, thereby reducing the waiting time in the A&E for urgent care.

Emphasis will be placed on public education and all non-urgent care patients will be urged to utilize this new facility.  When the General Practice Clinic is relocated, it will make available another 3,800 square feet of space allowing for the final upgrading and expansion of Accident and Emergency Department.

The operating theatre renovation and expansion project at the Rand Memorial Hospital is advancing well. This project includes the construction of two operating theatres, One Endoscopy Procedure room, one induction room, Day Surgery Facilities, Central Sterile Supplies Department, Staff Lounge and Changing Rooms. This work is scheduled for completion in September 2011 at a cost of $3.5 million.

I am also pleased to report that the projects for the relocation of the Rand’s Specialty Clinics, to the leased facility on Coral Road and for the subsequent temporary relocation of the Accident and Emergency Department, were both effectively accomplished in this fiscal period. This paved the way for the commencement of the Renovation and Expansion of the main Accident & Emergency Department at that hospital. This construction is proceeding very well and completion is targeted for August 2011, at a cost of $2.1 million.  When completed, it will be one of the most modern Accident and Emergency Departments in the region.

Additionally, the residents of the Freeport, for the first time, will be provided with a state of the art community health center, offering the full range of primary health care services including those for Mothers and Children and for the prevention and control of Chronic Non-Communicable Diseases. The project leading to the construction of this new facility is presently underway with the development and fine-tuning of functional programming and master space plans.

At the Sandilands Rehabilitation Center, two major infrastructural development projects are currently underway: the renovation and expansion of the Geriatrics Hospital, and the construction of a new building to accommodate the Child and Adolescent Unit and Robert Smith Ward.

The contract for the phased redevelopment of the Geriatrics Hospital at Sandilands Rehabilitation Center includes: the expansion of the northwestern quadrants of the facility, providing for isolation rooms; staff lounges, mechanical/electrical rooms, visitors’ rooms; the relocation of the housekeeping closets and patients bathrooms, upgrading the life safety systems and installation of a conventional plumbing system.

This work will greatly enhance the overall environment of care for our geriatric patients; improving family and provider satisfaction and direct patient-care. Several phases of this project are already completed with final works scheduled for completion by the first week in June 2011, at a cost of $1.5 million.

The construction of the Child and Adolescent Unit and Robert Smith Ward, undertaken by the National Insurance Board, is now proceeding satisfactorily. This new inpatient facility, (started under the administration of Members Opposite, is designed for children with special mental health, behavioral and developmental needs. Completion is scheduled for September 2011.

Mr. Speaker,

It is important to note that components for management strengthening have been included in all of these infrastructural projects, in an effort to improve efficiency and quality in the delivery of services within the new and renovated areas. These components include staff training (250 of the National Jobs Training Initiative) and retraining; new and improved processes, procedures and protocols; and better management support systems.

Mr. Speaker:

This Budget begins a shift in the role played by the Government at the height of the economic crisis of supporting jobs to a role of promoting job readiness, job training and new job creation.

This Budget again reflects Government’s firm commitment to effective budget-making through decisiveness and responsibility in response to the evolving environment.

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Accordingly, the core Budget priority is action to enhance employment and training through a National Job Promotion Strategy comprising a number of components

Government is creating a $25 million National Job Readiness and Training Programme to be developed jointly by public and private sectors and to target areas where shortages of workers exist; three major components:

* Service and Productivity Improvement Thrust

o focus on youth to enhance job readiness by addressing idleness, poor work attitudes and the lack of literacy and tradable skills.
o target some 1000 participants for up to 52 weeks

* Retraining Thrust

o skills development for mature persons; 1000 participants for up to 52 weeks
o upgrading skills for existing jobs or acquiring new skills for new jobs

* Apprenticeship Thrust

o acquisition of basic and advanced technical skills; 1000 participants for up to 52 weeks

This Project also makes provision for the following:

* A Work Placement and Employment Exposure Programme to provide opportunities to gain work experience, as well as on-the-job training and skills to enhance employability; Government will offer a wage subsidy to private sector for every new employee

* $1.5 million Jump Start Programme to encourage job creation through grants of up to $7500 for persons over 30 years starting new small businesses; focus on start-ups creating attractions or amenities for tourism sector, particularly the cruise sector

1000 of these jobs will be identified specifically for Freeport, Grand Bahama.

* A Public Service Employment and Training Initiative to recruit into the Public Service 100 college/university graduates, 50 High School graduates with BGCSEs and 50 with only BJCs; focus on practical work experience and training and preparing for senior positions in Government.

* Business Licence tax holiday extended through 2012 for small and medium size businesses with turnover up to $500,000

* An SME Development Act is being prepared to establish the basis for effectively providing financial and non-financial services to SMEs through a new SME Development Agency; will administer financial and non-financial instruments according to the diverse needs of SMEs and in regard to their sector and location

* Medical Care Improvement Act will encourage, through duty-free entry of building materials and medical equipment, improvement of medical care under agreements with entrepreneurs for investment in new medical care facilities or major refurbishments; matched by five-year customs duty exemption for PHA and NIB for similar programmes.

In our continuing programme of modernization and administrative reform, this Budget provides for the continued implementation of my Governments plans to increase efficiencies throughout the Government system.  In this regard I again draw attention to the following:

* e-Government Initiative ongoing with launch of initial components in July with creation of Department of Information Technology and seven government services going online; aim to transform Public Service by improving efficiency and productivity and improve our ranking in respect of the ease of doing business; and

* Modernizing and improving revenue administration through creation in July of new Tax Administration Division in Ministry of Finance with responsibility for integrated collection of several taxes and ensuring compliance with tax legislation; discussions of tax reform to figure prominently in public discourse in period ahead.

Mr. Speaker:

Teachers…

I note that the number of public officers retiring over the past 12 month period ending 30 June, 2011 amounted to some 258 persons with a total annual salary bill of $ $8.5 million.  The majority of these would have held posts which were not filled subsequent to their retirement.  These officers will receive some $10.1 million in gratuities and enjoy annual pensions totaling some $3.7million.

This Budget provides for the engagement of 200 new appointments including high school graduates with the requisite BJC or BGCSE certificates (50 each) and college and university graduates (another 100).

The Budget also makes provision for some 417 new appointments throughout the public service providing for key new appointments the Department of Public Works, Department of Education (40 new teachers, 83 security assistants, 25 security officers and 50 janitresses/janitors), Department of Social Services (10 case aids and 10 social workers), the Department of Public Health (7 medical officers) and (35 nurses and 20 doctors) at the Public Hospitals Authority, the Prison Department (50 officers at a cost of $900,000) and the Defence Force (62 officers presently in training and another 60 will be engaged in November, 2011 and March 2012.

Mr. Speaker:

I note that this impacts a considerable number of public officers will benefit from the payment of the increment and the expansion of salary scales as reflected in the long list of officers provided to me by the Department of Public Service. (See attached)

The record shows that it has been my Government’s policy to share the gains of good economic times with the Bahamian people through:

1. reduction in the rates of duty on many items;
2. public offering of government owned entities like the Bank of The Bahamas, bridge bonds and now BTC and Arawak Port; and encouraging the private sector to make shares available to Bahamians (Cable Bahamas, CIBC, Freeport (nor Grand Bahama) Power and now Commonwealth Brewery)
3. improvements in fiscal incentives to businesses;
4. the establishment of minimum wage;
5. improvements in the terms and conditions for civil service employees;
6. improvements in social services through improved pensions;
7. dramatic upgrade of the country’s infrastructure; and
8. through a level of fiscal spending that saw the lowest levels of GFS deficits on a sustained basis in our history.

This Budget, even in these tenuous economic times, continues in that tradition:

Mr. Speaker:

Key Revenue Measures

My Government is again introducing a number of measures to further rationalize tariff and excise rates, encourage energy efficiency and provide relief to consumers.

Among others, duty rates are reduced on:

* fresh fruits including avocadoes, cantaloupes, honeydew melons, papayas (papaws),  figs, apricots, cherries, nectarines, raspberries, blackberries, mulberries and tangelos;
* turkey/ham/beef sandwich meats,
* chicken,
* yogurt,
* jams, jellies and marmalades,
* instant coffee,
* tomato ketchup,
* black pepper, nutmeg, and salad dressings,
* detergents, including dish washing detergents,
* Hydraulic brake fluids and other prepared liquids,
* electric cars,
* biodegradable Styrofoam boxes, plates, cups and cutlery,
* insulated concrete forms, insulated steel walls, spay-on thermal foam insulation,
* solar air conditioners, and
* kidney machines and parts  (See full list at Annex III.)

I acknowledge Mr. Speaker, that some concern has been expressed by producers of fresh fruit who fear their inability to compete with some large foreign producers of fruit.  In this regard, I wish to remind that the Ministry of Finance upon the recommendation of the Minister Responsible for Agriculture, has the authority to impose a prohibitive tariff of up to $300% when circumstances warrant – for example, when the Minister is satisfied that the supply of a locally produced fruit (avocado, watermelon, mango) is adequate to meet market demand.

Other adjustments to tax and fees include:

* Current $7 air ticket tax applicable on tickets sold in The Bahamas for travel outside The Bahamas is being eliminated and merged with $20 air departure tax; effective October 1, 2011, combined air departure tax to be levied at $25 per ticket
* Stamp Act amended to clarify that exemption for mortgage transfers between lending institutions applies to all such transfers and not only for first-time homeowners.
* To encourage payment of commercial property tax arrears, a 100 per cent waiver of the applicable surcharge will be offered for a period of six months
* Fourth Schedule of Tariff Act amended to provide exemption for purchase of classroom supplies by teachers with confirmation letter from their school
* Tariff Act amended to provide for tariff rates agreed under the Economic Partnership Agreement with the European Union

Mr. Speaker:

Reactions to this Budget, as might be expected, have been varied.

I am heartened by the response of many in our society who demonstrate support and appreciation for what we seek to do.   They understand the circumstances in which we find ourselves and understand the need for budgetary restraint.

As I have said we believe that the provision of grant funding – seed money – to micro-business start-ups, is well placed to support the entrepreneurial interests of many small business persons. Our jobs training and job-readiness programmes promise to significantly enhance the employability of as many as 3,000 persons – a significant number in every sense of the term.

I do so earnestly wish that I were able to benefit from the considerable advice of my many armchair economists and fiscal advisers.  The trouble is, although the advice is so fervently given, it is so contradictory.  Considering that it comes from people I regard as reasonable intelligent I am baffled at how widely their views could differ – a fact from which I get some sense of comfort.

Our editorial writer graciously incorporates the contradictions in one editorial – noting that the jobs promotion initiative is indeed a step in the right direction, but having regard to the increase in unemployment since 2006, doubted that the $25 million allocated for the purpose was enough.

Not surprisingly, that he has suggested that Bahamians may not have sufficient money to purchase 9% of the BTC shares that are to be made available to the public, this notwithstanding his earlier position that 51% of the shares of BTC ought to have been sold to Bahamians!

He then goes on to worry about the difficulty of achieving a revenue proportion of higher growth than the economy (here he makes a similar mistake to a related party in failing to distinguish between growth in constant prices and growth in current prices.  And without missing a beat he goes on to worry about the management of the debt and even manages to cast doubt on our measurement of debt ratios on account of GDP revisions by the Department of Statistics.

It cannot be that Government assistance in stimulating growth, improving employee skills and labour efficiency and providing jobs by the injection of $25 million directly into the economy through a National Job Readiness and Training Initiative is both too little and too much.

How could it be that a $7,500 grant for the launch of one’s own micro-enterprise without the worry of debt-servicing is a waste of time?  How many mini-enterprises have been launched with less, and how many have missed an opportunity because it was not available?  This kind of cynicism does a grave disservice to the spirit of entrepreneurship.  Clearly, what these critics have in mind is something quite different from a micro-enterprise that converts an employee to a self-employed person in a mini operation for which he has the skills and which has the potential to generate a living wage with an opportunity for growth and expansion.  What these professionals who rush to judgment should be doing is identifying the opportunities for one or two man operations that offer the potential for engaging this programme and benefitting from the grant-funding available.

Sometimes our rejection of an initiative seems too much a knee-jerk reaction.  “It is a good idea, but not enough” seems entirely insensitive to the reality of limited national resources.

Or “good idea but wrong approach” is really self-contradictory.  If it’s a good idea, see it through – make it work – give it a chance.  Engage it until the perfect solution presents itself, although one suspects it does not exist.

One hopes when the initial responses are over and the benefits inherent in these initiatives come more clearly into view that the professionals who are able to do so will assist others in identifying opportunities that will enable them to become self-employed entrepreneurs.  And that others will embrace the national Job Readiness and Training Initiative, willing to give their assistance to the effort.

Government Borrowings and the Government Debt

A fiscal commentator has asserted that by the end of fiscal 2011/12 the Government will have borrowed $1.7 billion during its term in office, with the majority of the money borrowed being spent paying for deficits such as civil servant salaries, rents and other charges.  In point of fact estimated Government borrowings during the five year period to end Fiscal 2011/12 is $1.69 billion.  Of this $360 million will be applied to debt so that the net borrowing will be $1.33 billion, $900 million of which represents payment on Capital deficits and the balance of roughly $400 million will be in respect of salaries, rents and other charges.

Government debt at the end of the period is expected to be about $3.78 billion, an increase of $1.34 million over the level of Government debt at the beginning of the period of $2.44 billion.  Of the net increase of $1.3 million in Government debt, slightly more than 2/3rds is in respect of the capital account and less that 1/3rd is in respect of current account charges.

Recurrent Revenue Projected to Grow Faster than the Economy

One fiscal critic asserts that recurrent revenue is projected to grow faster than the economy but this is not correct.  The projections for recurrent revenue are for the growth of 3.7%, from $1.460 billion to $1.514 billion in current prices.  The projection for GDP growth in current prices is from $7.856 billion to $8.182 billion for an increase of 4.1%.

The projected GDP growth of 2.4 % for 2011/12 is in constant prices.  Recurrent revenue, shown in current prices, is estimated to grow more slowly than the economy – 3.7% to 4.1% in current prices.

False Sense of Comfort from the GDP Revision

I was amused to learn of the “false sense of comfort” concerns that arose from an improvement in the estimation of the country’s GDP by the Department of Statistics.  Although I expected this response from the political realm, it was a little curious coming from a professional.

When I learned that the Department of Statistics had revised upward the GDP, I fully anticipated the political cynicism that would greet this revision.  It was rather curious that a professional was thrown by it, especially one who would be aware from experience that GDP is an estimate and that the Department of Statistics has been continuously upgrading its estimating methodology and continuously revising the published date, and doing so without reference to the political directorate.

What is particularly confusing is the notion that improved estimates of GDP which revised downward the debt to GDP rations should itself lead to a “false” sense of comfort.  One would normally think that the more accurate the statistics, the greater the benefit to those relying upon it.  If it is more reliable what makes the comfort false?  This self-condemning psychology which seems to suggest that the lower the GDP is inherently more helpful in inducing the right frame of mind in policymakers is nonsense.

Competent fiscal management suggests that the more reliable the data, the more informed the analysis and policymaking.  Preference for a lower GDP even if it is less reliable is a peculiar curiosity.

Finally, I must mention the fiscal advisor who noted that we are not yet at pre-recession debt to GDP levels.  I must ask where he has been.  Certainly he would not have checked his home country or most other countries in the world for that matter – in a very long time.

1,000 National Job Programme Posts for Grand Bahama – Budget Debate Part 1 from FNM Restoring Your Trust on Vimeo.

1,000 National Job Programme Posts for Grand Bahama – Budget Debate Part 2 from FNM Restoring Your Trust on Vimeo.

1 COMMENT

  1. Her we go again a Hubert (AKA) Ingraham Budget written by the ghost of the former minister of finance Sir Stafford Sands. Kelly Island was renamed Arawak Cay. Is the FNM Cabinet planning on changing the name back to Kelly Island? Maybe this time they should rename it Kelly & Symonette Island. I wonder if the FNM cabinet had to pay the Kelly’s and Symonette’s rent to hold their Fish Fry? Maybe in another 43 years when the new elite Haitians want the government’s backing for whatever they need millions of dollars and land for, they can rename it Port au Prince Island? The UBP is still proving they can have any Urban (Business) Renewal Centres they want as long as they can maintain control of that FNM cabinet room.

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