Bermuda Fiscal Responsibility Panel Report
The 2021 Bermuda Fiscal Responsibility Panel Report has been released, with the report designed to “review, monitor, assess and publicly report on the fiscal progress of the Bermuda Government.”
The report said, “Over the medium term, the Government needs to boost revenues to reduce debt from its very elevated post-pandemic levels and to manage the considerable contingent liabilities.
“Looking more broadly, Bermuda’s most fundamental challenge is demographic; a shrinking workforce and an ageing population inevitably undermines the sustainability of the pension and health systems. Both systems require reform, but a growing working population would make a major contribution.
“Pressing challenges include: the need to restart economic growth, in the traditional economic sector of tourism and related services and more broadly through further diversification; the need to modernise the tax system in the context of global discussions on minimum corporate tax rates; and of course climate change.”
A Government spokesperson said, “The Report represents the seventh annual report of the Fiscal Responsibility Panel [the Panel], which was established in 2015 as an international independent committee, to review, monitor, assess and publicly report on the fiscal progress of the Bermuda Government.
“The Panel is composed of a team of international experts, chaired by Jonathan Portes, a former government chief economist and UK Treasury official and now a professor in economics and tax policy at Kings College in London. The other members of the Panel are Marian Bell, a former external member of the Market Policy Committee at the Bank of England who also previously advised on fiscal matters to the Government of Jersey; and Victoria Perry, a US tax lawyer who recently retired from the International Monetary Fund, having spent many years providing technical advice to countries on tax policy and revenue administration.
“The Report contains a comprehensive analysis of Bermuda’s fiscal and economic position, its strategy, and related actions. The Panel provided their assessments, highlighted critical risks facing Bermuda, and provided recommendations for several key areas impacting Bermuda’s fiscal and economic outlook.
“These include fiscal and tax strategy, expenditure policy, the Economic Recovery Plan, Bermudians’ access to financing; Immigration, Health, Pensions and Climate Change.
“The Panel endorsed key aspects of the Government’s fiscal and economic strategy, including the Government’s commitment to staying within the spending allocations for this budget year. The Report also noted that on present plans, Bermuda was on track to remain within the new fiscal guardrails established in relation to the ratios of gross and net debt to GDP.
“The Panel also positively endorsed work being done with regard to the Economic Recovery Plan, immigration reform, and climate change. The Report also includes recommendations for consideration by the Government. These include the following concerning fiscal and tax strategy:
“Fiscal Strategy – should establish, in the next Budget, a set of time-bound objectives relating to revenue and budget balance after 2023-2024 and targeting a budget surplus of $50 million a year by 2026-2027.
“Tax Strategy –overhaul the tax system with a medium-term strategy which will move towards a more progressive tax system with a broader tax base, and appropriately take into account changes required as a result of the OECD Global Tax initiative.
The Review Panel noted that, “having now largely emerged from the worst of the pandemic, with the right policies, the prospects for Bermuda are bright. The potential of the island and its people should not be in doubt”. The Panel commended the potential of the island and its people. Although they recognized the nature and extent of current challenges, they stated that “policies to address them are being developed and were impressed by the sense of urgency on the part of the Government and the shared commitment of other stakeholders”.
“Premier and Minister of Finance, the Hon. E. David Burt expressed his appreciation to the Bermuda Fiscal Responsibility Panel and those who contributed to the Report for their hard work.”
The full 2021 Report follows below [PDF here]:
Reports of this nature have been around for years yet no one, least of government, pays any attention to them.
Although containing valuable commentaries on the Bermuda economy, I suspect that the members of the commission regard their annual report as recompense for vacation in Bermuda thus avoiding the terrible winters that plague Europe.
This report will be filed and forgotten. The members will collect a hefty fee for their efforts (as well as a vacation) and the governing party will continue to torpedo our economy bringing, in the long term, poverty and distress to Bermudians. Many have already started on this path witness the several soup kitchens located at churches.
Those in authority should be held up to ridicule because of their failure to maintain our economy. They are a disgrace and deserve widespread criticism for their incompetence, and the Fiscal Responsibility Panel should held up to ridicule for their well known ability to pick up sizeable fees
I couldn’t have said it better myself
“The Panel is composed of a team of international experts, chaired by Jonathan Portes, a former government chief economist and UK Treasury official and now a professor in economics and tax policy at Kings College in London.
The Review Panel noted that, “having now largely emerged from the worst of the pandemic, with the right policies, the prospects for Bermuda are bright. The potential of the island and its people should not be in doubt”.
…cue the naysayers….
That’s a fundamentally flawed conclusion that doesn’t stand up to any sort of scrutiny. In fact, a simple look at Bermuda’s demographics will tell you it’s not sustainable.
It’s a feel good report, to make the politicians feel they are doing well, and to keep the consultancy fees flowing. Why else is there no mention of reducing Government expenditure?
Amazing how he picked out those two sentences but ignored the dozens of others that speak to our financial dilemma (crisis?). Head in sand approach generally doesn’t work.
Written by a bunch of lefties who want to see higher taxes.
AGING POPULATION
The report talks about an aging population of which i am part of so the think older people are a liability
we have much wisdom from many past experiences .
STOP throwing our seniors under the bus
A plumber has to work with the tools he has at hand ”
Bermuda has got to learn to manage with what and who is available as our seniors value to society is 10 times that of the other guy.
We buy land and they buy a car !
They live for today ,we live for tomorrow !
TIME TO THINK ! It is not what they say that matters it is what they do not say.
Donald,
If you think about it, our children have grown up with instant gratification. The Nintendo game console was released in 1985. The Nintendo Game boy was released in 1989.
Where we grew up with Monopoly and Scrabble and playing cards, our children grew with Nintendo games. It is not entirely their fault.