BPSU: Concerns With Elements of SAGE Report

December 10, 2013

The Bermuda Public Services Union [BPSU] said they have “some major concerns with elements of the Final Report submitted by the SAGE Commission,” and said implementing the majority of the recommendations “would lead to economic suicide”

“We understand that, at this stage, the report is only a set of recommendations and we will reserve comments on the entire report,” said a statement from the BPSU.

“It is realized that it is not at all practical to implement the majority of the recommendations made by the SAGE Commission in this current economic climate. Doing so would lead to economic suicide and would move Bermuda further into the dark hole we that are trying to climb out of.”

The BPSU said while they “find the overall tone of the report to be extremely subjective,” the Union generally supports recommendations that focus on performance, in particular: reducing budget overruns, implementing strategies for succession planning and talent management; controlling Ministerial overrides; aligning policies, goals and measures and mproving the checks and balances in the current system

However, the BPSU said they “would like to have more serious dialogue with the Government on privatization, pension, public expenditure and strategic planning.”

The BPSU said they believe that “public services are essential to the quality of life of the residents of Bermuda and as a result, we will not and cannot accept that the wholesale distribution of public services to the private sector is a necessity. Too often it seems that public services get taken for granted when you consider their value and role in building economies.”

“We have seen the negative effects of privatization on employment, pay and economic and social welfare around the globe. We will not stand by silently and watch the workers and residents of this Country endure any further preventable hardships. ”

The Union said they “would have expected that the Commission’s Final Report would have identified and addressed areas of duplication, waste, and inefficiency within Government. However, the Final Report submitted to the Government lacked detail on those critical areas.

“The report also failed to address how Government can reduce expenditure on Professional Services [$85 million annually which includes contracts to consultants and vendors], energy cost [$20 million annually] and monies spent on Rentals [$18 million annually],” added the BPSU.

The full statement from the BPSU is below:

The Bermuda Public Services Union [BPSU] has always supported steps to make the Government more productive and efficient. We would like to consider ourselves as being transformational agents and not an institution that impedes constructive change. Our efforts of supporting a more innovative and resourceful Government have been exemplified in many ways throughout the years and most recently through our Quality Public Services Campaign launched in May of this year.

All Bermudians should support the aim of a cost-effective Government, even more so in these challenging times. However, in order to achieve this, Government must create a new culture that garners trust and fosters true collaboration with public service workers. We believe that increased efficiency and productivity can be achieved without large scale job cuts and the erosion of employee benefits.

The BPSU understands the fiscal stress that the Government currently faces as a result of their expenditures continually exceeding their collected revenues. We recognize that this trend, if continued, will have a detrimental effect on Government’s ability to operate and pay its debts. We realize that the time to act is now.

The BPSU has some major concerns with elements of the Final Report submitted by the SAGE Commission. We understand that, at this stage, the report is only a set of recommendations and we will reserve comments on the entire report. It is realized that it is not at all practical to implement the majority of the recommendations made by the SAGE Commission in this current economic climate. Doing so would lead to economic suicide and would move Bermuda further into the dark hole we that are trying to climb out of.

The BPSU, in being more proactive, find ourselves moving away from our traditional position of it being Management’s job to manage and the Union’s job to just represent our members in responding to management’s decisions; as there are already too many threatening to weaken and hobble the public service. We have a responsibility not only to protect public services but also to fight for improved quality services.

While we find the overall tone of the report to be extremely subjective, the Union generally supports recommendations that focus on performance, in particular:

  • Reducing budget overruns
  • Implementing strategies for succession planning and talent management
  • Controlling Ministerial overrides
  • Aligning policies, goals and measures
  • Improving the checks and balances in the current system

However, the BPSU would like to have more serious dialogue with the Government on privatization, pension, public expenditure and strategic planning.

Privatization

The BPSU believes that public services are essential to the quality of life of the residents of Bermuda and as a result, we will not and cannot accept that the wholesale distribution of public services to the private sector is a necessity. Too often it seems that public services get taken for granted when you consider their value and role in building economies.

Many countries’ economies were built on the backs of public services and public service workers, so there is a need to be more focused on the value of the Service and not so much on the people who deliver the service. The services that the public sector provides to Bermuda’s economy are critical. We have highlighted this during our Quality Public Services Campaign, where we noted the importance of quality public services to the country’s economic revival.

We have seen the negative effects of privatization on employment, pay and economic and social welfare around the globe. We will not stand by silently and watch the workers and residents of this Country endure any further preventable hardships. The philosophy that the public sector is inefficient and that the private sector, using a more business acumen, is better suited to deliver, is a concept that is shared by many worldwide. The belief that the benefits of privatization will have a trickle down effect has been proven wrong time and time again in a number of jurisdictions. The only thing that trickles down is the fallout from these profit-making entities where there is no accountability or repercussions for poor service.

Pensions

The pensions of current and former public service workers are something that the Government and the Unions must work on collectively to get it right. The effects of a collapse in the Public Service Superannuation Fund [PSSF] will be detrimental to Bermuda’s society. A solution is needed to tackle the current reality facing the PSSF. The underfunded liability of approximately $973 million combined with the Government’s current financial position is of grave concern.

The Union welcomes dialogue with the Government on this topic as we do not believe that the two options presented by the SAGE Commission are the most practical ways forward. The BPSU is currently exploring an alternative solution which is a hybridization of the current Defined Benefit [DB] plan. The hybrid plan seeks to incorporate elements of a Defined Contribution [DC] plan into the current Defined Benefit plan. We do not support a complete move from a DB plan to a DC plan, as DC plans possess and will create its own new set of short falls.

Public Expenditure

The SAGE Commission had a mandate to comprehensively review the services that the Government provided along with the expenditure allocated to those services. The Union would have expected that the Commission’s Final Report would have identified and addressed areas of duplication, waste, and inefficiency within Government. However, the Final Report submitted to the Government lacked detail on those critical areas. That failure now hinders the Government’s ability to symmetrically address unnecessary or excess Government expenditure, and leaves the Minister of Finance no other option but to implement thoughtless, archaic across-the-board cuts that reduce expenditure by a specified percentage in all Departments.

The report also failed to address how Government can reduce expenditure on Professional Services [$85 million annually which includes contracts to consultants and vendors], energy cost [$20 million annually] and monies spent on Rentals [$18 million annually].

Strategic Planning

The BPSU wholeheartedly supports the SAGE Commissions recommendation for the creation of a National Strategic Plan by the Cabinet Office and Civil Service Executive. However this cannot be accomplished without the Government providing them with a clear national vision for Bermuda. It is critically important to understand that Vision and tasks are different. What we do, that is, the tasks we execute, is not Vision.

A Vision statement has three parts: Who we are? Where are we going? and, What we will do to get there?

The SAGE Report recommendations are only part of the answer. The SAGE Report does not speak to the direction of the Country. The SAGE Report speaks to inefficiencies and what needs to be done, but this is only part of the problem. For example, you can drive a very efficient car that runs well where you get good mileage but after a few hours of driving you realize that you are going in the wrong direction.

Similarly, you can drive a very inefficient car, get the tires changed, oil changed, new battery and drive with good mileage and realize after a few hours your travelling in the wrong direction. Having a national vision of where you are going is important – a Strategic Plan is needed with specific country goals and action items allocated to specified Ministries to accomplish the vision within specified timelines.

Some tasks and objectives outlined in the SAGE report could perhaps be executed as recommended but ultimately they should fit into our Country’s vision and strategic plan in order for us to understand how what we do fits into the big picture of where we are going, otherwise recommendations can be implemented and we still won’t know where we are.

The recommendations of the SAGE Report have heightened interest among public sector workers, trade unions, and the private sector. As we continue to fight for the rights of workers, benefits, and job security, it is our intention to inform and educate the membership on the many circumstances that are related to the recommendations of the SAGE Report. We encourage everyone to review this document as it will affect the future of this Country and have an impact on our lives. We realize the way forward for all stakeholders is consultation, collaboration, and meaningful dialogue that will see us through these troubling economic times.

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Comments (18)

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  1. inna says:

    so Mr Ball, where are your solutions?

    • Hmmm says:

      “areas of duplication, waste, and inefficiency within Government”

      What immediately springs to mind?

      • inna says:

        SAGE report?

      • Justin says:

        LOL! I love it. For those who can’t figure out what you are saying – Why does Bermuda need more than one union?

  2. O'Brien says:

    This is like asking the turkeys what they think about Christmas.

    Our civil service is many times overstaffed – and yet remains chronically dysfunctional and inefficient. The Post Office is one of many glaring examples (100 too many staff and it still won’t deliver mail if you don’t include the post code??). Worse still, it widely considered as a ‘job for life’ — offering job security undreamt of in the private sector.

    The SAGE Commission has laid bare what we have all known for some time and has suggested means for Government to get things under control. The BPSU say they have ‘concerns’ – but they would say that, wouldn’t they?

    • Voter says:

      Yet yesterday there was only one person in parcel post, saying it was understaffed.

      • Ringmaster says:

        Well said. Go the main PO and if you are lucky there are 2 people on the counter, and likely only one during lunch time. Hello, when would most people use the PO but in the lunch time?
        So what are the other 100 doing?

  3. Truth is killin' me... says:

    “THIS TOO SHALL PASS!”

  4. jt says:

    Start with reducing paid holidays and sick time. Shift pensions to defined contribution plans.

    • concerned ambassador says:

      I agree! 60 + sick days per year. Unheard of in the private sector! They should be cringing

  5. swing voter says:

    so gov’ment is bloated like a puffer fish, we all know that. SAGE has documented and reported what a lot of us already knew. They even offered several solutions to cure our disease called ‘over-spending’. Even Cayman is using SAGE report as an example of where they don’t want to go as a country.

    WTF is the problem with cutting the fat? with 40 pennies of every tax dollar being used on salaries to keep people employed because they can’t make it in the private sector is a piss poor way to move forward.

    For the country to survive on a whole, a few must be sacrificed….lets do what we must to save Bermuda.

  6. LOL(original tm and all that) says:

    So basically whether we lay off mass numbers of civil servants, or continue funding the service at current staffing levels which we can no longer afford, we’re screwed. Rock, meet hard place.

  7. Bermuda boy says:

    Bermuda pays out to much money anyway. How much do we pay former premiers, army officers, police officers on top of their pensions. Just asking

    • swing voter says:

      yup after being forced by law to contribute to the gov’ment fund for throughout my career, with 15 years to go before retirement, I’ve already been told by a pension administrator that there will be no money left in the public pension plan when I retire so don’t bother. The current CS, Police, etc, along with the Gov’t have sucked it dry. Thank god that I chose the private sector, my private pension plan is protected

  8. Worker says:

    The unions should have been concerned when the PLP ran Bermuda into the ground. As a result their membership will have to take pay cuts,or job losses.The unions should also reduce their membership dues accordingly!

  9. Saving money would lead to economic suicide!? WOW just WOW! BTW “economic suicide” was they way the PLP was running the country!

  10. Walter Burgess says:

    The first objective that needs to be addressed ASAP is to remove those on the Govt side that negotiate with the various unions and replace them with a team similar business skills of those on the SAGE commission.

    The second objective is to determine if you can readdress these outrages pensions being collected by senior civil servants $2K + a month is crazy and when you look at the state of the civil service to boot what value did most of these senior civil servants bring and leave to their positions.

    Just my view.

    -FWB….

  11. Ringmaster says:

    Put a stop to rehiring people who have retired and collecting a pension, only to be paid as a consultant or employee.

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