Debt Calculated From $2.4 Billion To $3.8 Billion

December 28, 2018 | 51 Comments

Bermuda’s most recent debt has been calculated at amounts ranging from $2.4 billion to $3.8 billion, with the first figure reflecting “the amount of debt borrowed less the monies in the sinking fund” and the second indicating the “difference between a government’s liabilities and financial assets.”

$3.6 Billion Figure

According to Auditor General Heather Thomas, “As at March 31, 2018, the net debt is $3.8 billion, an increase of $63 million over the last fiscal year.”

Ms Thomas stated this as she commented on the financial statements of the Consolidated Fund of the Government of Bermuda for the year ended March 31, 2018.

She said, “The first issue I comment on in the ‘Other Matters section is to draw attention to the level of the Consolidated Fund’s increasing net debt. As at March 31, 2018, the net debt is $3.8 billion, an increase of $63 million over the last fiscal year.”

The statement said, “The public sector accounting standards generally accepted in Bermuda and Canada defines Net debt as the difference between a government’s liabilities and financial assets. This difference bears directly on the government’s future revenue requirements and on its ability to finance its activities and meet its liabilities and contractual obligations.”

Minister of Finance Curtis Dickinson noted that the “Government shares the Auditor’s concerns in these areas and has already started to tackle these matters” and “the Ministry of Finance has already put in place a plan to eliminate the deficit and ultimately reduce the debt.”

$2.466 Billion Figure

In reporting on the first half fiscal performance earlier last month, the Finance Ministry noted that “gross debt at the end of September 2018 stood at $2.619 billion, and net of the Sinking Fund debt was $2.466 billion.”

We asked for clarity on how the amounts are calculated, and a Government spokesperson explained, “The Ministry of Finance calculation of debt is in accordance with the Government Loan Act and is the amount of debt borrowed less the monies in the sinking fund.

“The Auditor General’s calculation is in accordance with accounting standards as she has explained. One of the main differences is that the Financial Statements would include as debt the unfunded liabilities of Government’s pension Fund which are material.

“Likewise there is a difference between the Financial Statements of the consolidated Fund which are prepared on the accrual basis using accounting standards and the Budget that is presented each year which uses the modified cash basis.

“The issue was the auditing of the accounts not the preparation and the issues that gave rise to the qualification were resolved albeit after the deadlines.

The Governments definition is in accordance with the Government Loans Act 1978: See below:

“Authority of Minister of Finance to borrow:

“The Minister may, in such manner and on such terms and conditions as may be agreed with the lenders, borrow sums within the limit established by section 2A: Any agreement between the Minister and a lender under the powers conferred by subsection [1] shall be made in the name of the Government and shall be signed by the Minister or, if so authorized in writing by the Minister, by the Registrar.

“As soon as practicable after the execution of an agreement under this section the Minister shall inform the Legislature. Subject to subsection [5], any sum borrowed by the Minister shall be paid into the Consolidated Fund. The Minister shall, in any fiscal year, pay into the Fund any amount of the sums borrowed that is in excess of the amount necessary to meet the budgetary requirements of the particular fiscal year.

“[Section 2 amended by 1991:12 effective 28 March 1991; subsection [4] amended and subsection [5] inserted by 2013 : 23 s. 3 effective 23 July 2013] Authority of Minister of Finance to provide guarantees The Minister may provide a guarantee for money borrowed by, or any other obligation of, a third party, on such terms and conditions as may be determined by the Minister.

“Any such guarantee shall be provided in the name of the Government and shall be signed by the Minister. As soon as practicable after the execution of a guarantee under this section the Minister shall inform the Legislature.

“Limit on the public debt The public debt, less the amount of any moneys at any time in the Fund, shall not exceed $2,500,000,000. In this section, “public debt” means— indebtedness for money borrowed by the Government [in accordance with section 2], not including any credit facility which is available for drawing but has not actually been drawn; and indebtedness for money borrowed by a third party and guaranteed by the Government [in accordance with section 2AA], but only if and when, and to the extent that, the guarantee obligation becomes due and payable by the Government.”

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Comments (51)

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  1. Vortex says:

    Thank you Paula Cox. Your legacy.

    Time for the current government to realise how dire this is and impose austerity measures where they matter.

    • question says:

      Burt was Junior Finance Minister during that time, don’t forget.

      • Wake up OBAUBP says:

        American Cup increased our debt high, little long term results

        • Question says:

          The PLP increased debt by 600%. It’s the only thing they were good at.

        • -Um Um says:

          No it didn’t.

          • Anbu says:

            Plp voters are too thick headed to understand that the 300+ million injected i to the economy outweighs what we spent to get it here. Abt 30 mill less than was quoted actually. When has the pee el pee ever EVER done something under budget? Funny tho, i bet u guys like zane get their projects done on time and under budget for private clients. Funny how when its our dollar its ok to steal tho……..hhmmmm. WAKE UP PLP/UBP!!!!

          • LaV says:

            The PLP increased the debt by 1000%…the only thing they know how to do is spend other peoples money.

        • Vortex says:

          You should read the much missed Larry Burchall’s comments on it. Try ‘Our national debt time bomb is ticking’, or ‘27 Missing Words’ – published some years ago on Ber News.

          It’s objective- he is critical of Bob Richards too, but make no mistake- its the PLP and Brown, Cox and Burt that got us here.

    • 2 Bermudas says:

      The average Pee El Pee voter doesn’t care as long as the civil service makes payroll every week. Until then these are just numbers.

  2. Guy Carri says:

    That’s ok. PLP will continue to raise taxes to TRY and close the gap. Except they will continue to spend and the gap will grow despite EVERY resident having less in their pocket. PLP has NO PLAN to grow the economy! Their only plan is to tax it tax it tax it. Say what you like about OBA but financial we were ALL better off.

  3. WSP says:

    Lets make it an even $5 billion f@ck it.

    • J J says:

      It’s on cruise control now set at 5 Billion.

      I expect we will see the island advertised in the Dubai daily or the Shanghai morning news papers.

      “1 small Atlantic island, fading splendour, would benefit from new owners. Was once a successful business, but now needs new management to realise its potential”

  4. 2 Bermudas says:

    Like I’ve been saying, the only person better off under this Pee El Pee gov’t is Ewart Brown. More taxes coming in 2019!! Better start exporting that titty milk!! Ha ha ha!!

  5. Bermuda has no future says:

    That flushing sound we all hear everywhere we go in Bermuda is the sound of our future going down the toilet. Same old clueless, self serving PLP are only looking out for their elite while their absolute cluelessness ruins Bermuda for the rest if us. 25-11

  6. Concerned Bermudian says:

    Disgusted!!! PLP NEED TO GO.

    • Wake up OBAUBP says:

      OBA INCREASED OUR DEBT THREE FOLD WITH THE AMERICAN CUP AND SAY THEY NEED TO STAY IN THE BACK BENCHES

      • Question says:

        Ignorant crap.

      • Trufth says:

        Keep telling yourself that (while ignoring the financial facts). Eventually, you might believe it.

        Meanwhile, 24-12. You got what you voted for. Enjoy.

      • lol, bie you drinkin -lordy me! says:

        Such hysteria.

        The facts are the facts–the PLP is failing the country. They are using the same playbooko as the last time.

        The country is in dis-repair–Its every Bernudina’s fault–each and everyone of us.

        Problem is the politicians of this country are incapabale to fixing the problems–

        Admit it–its just that simple!

        Sorry sunshine–you can heap praise on your PLP Gvt but they are failing!!

      • Come Correct says:

        This is a lie and typing in caps doesn’t change that.

      • Anbu says:

        No they didnt you f@$&ing idiot!!! You and people of like minds are the sole reason this country is screwed.

  7. OBA did WORSE.
    Took government funds, unknown to the Bermuda public, and used it for A.C.B. Nasty group of idiots.
    Also, allowed Pat Pamplin and Richards to take funds out of the government purse for their dipsy, flipsy trip to Rio, for the sole purpose of going to the Olmypics.
    Shawn Crockwell saw inequalities, rampant unfairness in OBA. These facts are not to be forgotten.
    Remember Mark Pettingil telling BORN BERMUDIANS to vacate the island, soon after OBA claimed power.The list goes on and on!!
    That is why OBA was thrown out!!
    Money lost/spent through government for ridiculous purposes. rests with OBA…they did exactly what they wanted to do…even if the general public objected.
    Pathetic!!

    • JohnnyB says:

      Out of the total amout of debt how much was accumulated during the PLP term verse the OBA term?

      Ill wait…..

      • Wake up OBAUBP says:

        American Cup increased our debt high, little long term results

        • LaV says:

          LOL@Wake up….as usual, you’re clueless. You only say that because you hate Bermuda and you’re a racist.

        • Mark says:

          Typical idiotic PLP koolaid drinker.

        • Anbu says:

          How much EXACTLY did it increase it oh great kimosabi?! Please bestowe us with your grand knowledge and insight!!!………besides, “um um dat guy up der in d house sed dis hur d odda day um um um like dak dur boat race made r det go girt beeg bie!!”

        • Vortex says:

          Ok these are the facts, read Larry Burchall, @wakeup OBAUBP, you might learn something.

          2003 PLP came into power, debt stood at $35m
          By 2012 when they exited power it had risen to $1.905 bn
          By 2014 under OBA watch that had grown to $2.185 bn
          By 2018 it sits (at a mid point of range) at $3.1bn

          So both parties are to blame, but one created this and is largely responsible.
          The PWC report summarized the Americas Cup cost $64m but created $530m – it is utterly irrelevant here.

          When the money runs out Curtis, when the money runs out….

          • Question says:

            Except you’re mixing up apples and oranges with your current ‘midpoint’. He relevant number to compare to the others is $2.4bn. It’s obvious who ran up the debt.

            Investing $64m to expand the economy was not ‘irrelevant’ to the debt discussion. Expansion of the economy is the ONLY way to decrease defecits and pay off the debt.

    • lol, bie you drinkin says:

      way too much of de titty milk.

      Take a look around you right now–what do you see?

      OBA did none of what you are saying–in fact they placed the conomy back on a path of repair.

      Right now we have slipped back to the old days when debt spending was out of control.

      I applaud your devotion to the PLP – but their strategy is JUST NOT WORKING!

      • Stay awake says:

        Your sleeping OBA/UBP INCREASED OUR DEBT 3 FOLD

        MONIES ON THE AMERICAN CUP.

        • Anbu says:

          You got it wrong, its stay woke

        • LaV says:

          How many different names do you post under?

          We know it’s you, because you’re too stupid, after all this time, to realize it’s the “Americas cup”….which the OBA used to save Bermuda from the plp. …and not the “American” cup that you seem to think it is. Moron.

      • Wake up OBAUBP says:

        Guess you OBA FOLKS FOR GOT BUT THE OBA INCREASED OUR DEBT THREE FOLD WITH THE AMERICAN CUP, LETS NOT FORGET IT.

    • LOL says:

      Aww honey….you poor idiot.

    • 2 Bermudas says:

      So you’ve mentioned The Americas Cup and a couple trips to Rio as OBA financial mistakes. Ha ha ha!! Drinking too much titty milk over the Holidays I see!!

      - Port Royal
      - TCD
      - Court Building
      - Beyoncé
      - Kings Wharf
      - Playboy Mansion
      - $800m unaccounted for
      - $1.2m to Ewart Brown
      - Berkley

      Need I go on?

  8. Mark says:

    Wow – Onion Juice will have his pick of abandoned homes. Hope he’s making shoes from old tires and stocking up on Pedigree.

  9. swing voter says:

    doesn’t matter who did what, caused what, stole what, manipulated what….because they all have contributed to where we find ourselves. bottom line is, we little people that voted for the self serving trickle down UBP first then the PLP splurge, then the OBA that couldn’t find its way, and the PLP final death nail are screwed. IMF will get their wish finally.

    Political clubs are like religious clubs…they attract the gullible

    • LOL says:

      Well here is a nugget of truth on the interwebs. Will likely not be read but the smartedst comment in a while.

    • Anbu says:

      Then you swing voters must be the most gullible of the lot of us doncha think? Considering as they say it was the swing voters that won it for them. And if i remember correctly the swing voters didnt vote oba as proclaimed by so many “swing voters” as proclaimed on these very blogs. So by default that means u didnt vote oba EVER and only voted plp last election. So whose fault is it again? At least we can make up our minds.

  10. Coffee says:

    In 2015/2016 the OBA/UBP Partied away 1.4 billon dollars trying to impress a couple of billionaires with boats .

    Red koolaid and mixed nuts was flowing for party their members.

    Fresh milk for the party leader .

    Gas station bailouts .

    Oil changes and Insurance for the organizers.

    Trash bags for the peons.

    At the end of the money ….. They tried to blame the Opposition for making them spend the loot ! How grotesque is that ?

  11. Trump supporter says:

    Well done voters.. no possible way I will see us debt free.
    Keep travelling you bies, and paying docs.

  12. Sister Grace says:

    The really sad part about this they will vote the a$$es back in. You get what you voted for. Hope the day comes really soon when Curtis tells you sorry we cannot meet payroll. Then what will the jokers do? Trust and believe the day will come get prepared. The folks who were wise enough to save a few pennies will fly outta here real quick.

  13. aceboy says:

    Dickinson’s plan is to tax people out of business in order to pay the debt.

    Great plan.

    Not.

    The America’s Cup generated a massively positive return and yet the PLP paid bloggers are using it as an example of how the OBA increased debt. Too funny. Absolutely clueless. But they rely on the stupidity of voters to believe it, they just keep on repeating it. Goebbels would be proud.

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