Minister: Amalgamation To Save $700K This Year

March 27, 2023 | 4 Comments

Minister of Public Works David Burch provided an update on the progress to amalgamate the West End Development Corporation [WEDCO] and the Bermuda Land Development Company [BLDC] into one new entity, saying that “ we are anticipating a cost savings of$700,000] in this year alone.”

Speaking in the House of Assembly on Friday [March 24] the Minister said, “From a business perspective, this made complete sense since these two quangos share similar objectives, mandates, skills, accounting procedures and staffing levels

“This merger is a move for the future. We view these changes as an opportunity which will effect cost savings by reducing duplication of roles, combining responsibilities and bringing a sharper focus to deliver on the governments mandate to control costs and operate more efficiently. As stated in the Ministry’s budget debate – we are anticipating a cost savings of seven hundred thousand dollars [$700,000] in this year alone.

“This Government believes in fiscal prudence. This move should not come as a shock to anyone as I have said previously on numerous occasions, it makes no sense that on an island of only 21 square miles that we have twoorganizations [2 CEOs and 2 CFOs] and all the attendant offices, machinery and staffs carrying out very similar functions for the most part – with the full demonstration of unnecessary bureaucracy on display.

“This does not mean redundancies. To reiterate what I said in July 2022, the Government does not wish to see redundancies and with the valuable input and assistance from our Union partners – none are anticipated. While the initial staffing of the new entity will see minimal duplication of roles, reductions will occur overtime through natural attrition or retirement.

The Minister’s full statement follows below:

Mr. Speaker, this Government has a vision. A vision for a more efficient and effective Government – especially in relation to the Quangos.

As such, colleagues may recall in July of last year I stood here in this Honourable House and announced the Cabinet approval for the amalgamation of the West End Development Corporation [“WEDCO”] and the Bermuda Land Development Company [“BLDC”] into one new entity. From a business perspective, this made complete sense since these two quangos share similar objectives, mandates, skills, accounting procedures and staffing levels. Now I know some members will be keen to know what the new company will be called – that decision has not been made as yet – the Board are having those discussions.

As said in my previous statement – this follows recommendations from both the October 2003 Central Policy Unit report entitled “Untangling Bermuda’s Quangos – A review of Quangos in the Bermuda Government” and the subsequent Sage Commission Report presented a decade later in 2013 and another decade later we are making it a reality.. Acting on these recommendations has been a mighty long time in coming to fruition, but I am pleased that we are finally taking this initiative across the finish line.

Mr. Speaker, this merger is a move for the future. We view these changes as an opportunity which will effect cost savings by reducing duplication of roles, combining responsibilities and bringing a sharper focus to deliver on the governments mandate to control costs and operate more efficiently. As stated in the Ministry’s budget debate – we are anticipating a cost savings of seven hundred thousand dollars [$700,000] in this year alone.

With this being said, I am pleased to provide a further update on the progress thus far. Since the July 2022 announcement, for the last eight [8] months technical officers of WEDCO, BLDC and the Ministry have been working diligently to meet our deadline of January 2024. To date, the teams –

Are set to commence negotiations with the BIU and BPSU for new identical Collective Bargaining Agreements for both entities;

Began the Job description reviews and internal policy assessments;

Merged The WEDCO and BLDC servers and software – essentially running all finance and IT systems for both entities from a single location;

The Chief Financial Officer at WEDCO is now acting in a dual role for both entities; Compiled the asset and liability schedule for both entities;

are establishing a Marketing and PR joint strategy for the new entity; and have relocated key staff to assist with the transition initiative.

Mr. Speaker as you can tell, a lot of work has been done already but we still have some way to go. And that is why I am making this statement today – to update Colleagues on the transition teams activities relating to the seamless amalgamation.

Mr. Speaker as this transition is actively underway, I feel it’s pertinent to provide necessary clarity on the methodology for this process and avoid any confusion going forward. Upon prior consultation with relevant stakeholders in this initiative’s infancy – that is prior to the Cabinet approval and subsequent July 2022 announcement – the most efficient route to follow would be that WEDCO absorbs the assets and liabilities of the BLDC. This means that as a part of this initiative, the Government will be bringing forth legislation to:

1.amend the West End Development Corporation Act 1982 to reflect the merger; and

2.repeal the Base Lands Development Act 1996 which enabled the incorporation of the BLDC.

However, we are not at that point yet in the process. As aforementioned there is still more work to be done before bringing forth these pieces of legislation. This is the first step – the dissolution of the BLDC.

Mr. Speaker, the aforementioned Base Lands Development Act 1996 established the BLDC as a limited liability company in accordance with the Bermuda Companies Act 1981. Therefore to wind-up the BLDC, there is a set procedure in the Companies Act that must be followed.

Before this dissolution procedure can commence, Section 8[b] of the Base Lands Act 1996 provides that unless authorized by the Legislature, a member of the Company [that is, the BLDC] shall not procure the dissolution of the Company, or its amalgamation with any other person or body.

Therefore Mr. Speaker, as a member of the Company and with your permission, I will be tabling a motion later today seeking approval of the Legislature to begin the legal dissolution process for the Company in accordance with the 1996 Act. Once the BLDC has been legally dissolved, the Act can be repealed. Further steps will be taken later this year at the Annual General Meeting of the Company including the merging of the two Boards.

Mr. Speaker, this Government believes in fiscal prudence. This move should not come as a shock to anyone as I have said previously on numerous occasions, it makes no sense that on an island of only twenty-one [21] square miles that we have two [2] organizations [2 CEOs and 2 CFOs] and all the attendant offices, machinery and staffs carrying out very similar functions for the most part – with the full demonstration of unnecessary bureaucracy on display.

Mr. Speaker, this does not mean redundancies. To reiterate what I said in July 2022, the Government does not wish to see redundancies and with the valuable input and assistance from our Union partners – none are anticipated. While the initial staffing of the new entity will see minimal duplication of roles, reductions will occur overtime through natural attrition or retirement. The reasoning behind this direction is the benefit of ensuring that any important institutional knowledge is retained into future operations while avoiding severances. Colleagues may have seen the recent job advertisements earlier this month for 4 additional industrial staff. These jobs are being offered with the full knowledge of an impending amalgamation.

Mr. Speaker I am pleased to state that the phased approach to the merging is moving expeditiously. Thanks must be given to the team of technical officers ably led by the Mr. Andrew Dias in his dual role as General Manager and CEO of both WEDCO and BLDC respectively. I would also like to take this opportunity to thank the BLDC Chairperson Ms. Lovitta Foggo, JP, MP, members of BLDC Board, the WEDCo Chairperson – Mr. Neville Tyrrell, JP, MP and the Board at WEDCo for their continued service.

Mr. Speaker, I look forward to laying the required legislation before this Honourable House later this session which will see this Administration’s vision for a more efficient and effective Government take another step towards reality.

Thank you Mr. Speaker.

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Comments (4)

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  1. watching says:

    This is a good move! Well done!

  2. Joe Bloggs says:

    ” the Minister said, “From a business perspective, this made complete sense since these two quangos share similar objectives, mandates, skills, accounting procedures and staffing levels”

    What is the Minister’s business experience please?

    “This Government believes in fiscal prudence.”

    I am … speechless

  3. question says:

    If they aren’t going to make anyone redundant despite the obvious overlaps in staff functions at senior levels, which he freely admits, then they are as always, WASTING MONEY.

    Notably, he gives no specifics at all on where exactly this mythical $700,000 of cost savings is supposed to come from.

  4. Ringmaster says:

    Excellent news as a starter. Now reduce the number of MPs to say, 18 – 2 per parish – and save several million. Education has fewer children and schools so many tens of millions to be saved there. Postal service is only local, so another $5million easily saved there. Plenty more examples. Plus the savings may allow the pension plans to survive a few more years before running out of money.

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