Senate
Session 2018/2019
3 speeches
July 29, 2019
Official Hansard Report - Senate
Download PDF transcriptSession Summary
Simplified for YouThe Senate heard that a new Law Reform Commission has been established with six members to review and update Bermuda's outdated laws. The main debate focused on raising the retirement age for public servants (except police, firefighters, prison officers and teachers) from 65 to 68, while allowing voluntary retirement at 65. Senators discussed concerns about younger people accessing jobs versus the need for experienced workers to continue contributing to pension funds as Bermuda's population ages.
Key Topics
Appointment of new Law Reform Commission members to systematically review and modernize Bermuda's lawsIncreasing mandatory retirement age for most public servants from 65 to 68 years oldNew regulations for fund administration businesses in Bermuda's financial services sectorVarious minor amendments to financial services legislation
Bills & Motions
Public Service Superannuation Amendment Act 2019 - passed all readings (changes retirement age to 68)
Fund Administration Provider Business Act 2019 - passed second reading (new financial services regulations)
Four other financial services bills received first reading
Stenprop Limited Act 2019 - referred to Private Bills Committee
Notable Moments
Attorney General announced the Law Reform Commission is finally operational after being created in 2009 but never staffed
Senators debated whether supervisors having discretion to approve workers staying past 65 undermines the "no permission needed" promise
Discussion revealed that many private sector workers unknowingly agree to retire at 65 in their employment contracts
Debate Transcript
3 speeches from 3 speakers
Madam President.
The Pres ident
Thank you, Senator Campbell. ANNOUNCEMENT BY THE PRESIDENT SENATE VISITORS The President: And before I open it up to other Sen ators, I would just like to acknowledge the presence of the Financial Secretary, Mr. Anthony Manders, in the Chamber, as well as Ms. Miriam Rogers, the Parli amentary Counsel. …
Thank you, Senator Campbell.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITORS
The President: And before I open it up to other Sen ators, I would just like to acknowledge the presence of the Financial Secretary, Mr. Anthony Manders, in the
Chamber, as well as Ms. Miriam Rogers, the Parli amentary Counsel.
Welcome to you all.
[Public Service Superannuation Amendment Act
2019 , second reading debate , continuing]
The President: Would any Senator care to speak on
this Bill?
Senator Kempe, you have the fl oor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident. Thank you, Senator Campbell, for introducing
the Bill.
I guess there are two sides to the argument
about the retirement age. From one side, obviously,
we have a country with a demographic projection t hat
is skewing towards an average older age. So, of
course, the strains on our pension funds are going to
be significant. And there are people who are stru ggling when they get 65 and may wish to, or need to, keep working either to stay active or to fund our longer
life expectancies and what is needed down the line.
The other half of it, of course, is young people
trying to access the workforce, finding fewer openings
being available, and of course, the burden—I know we
are talking about public service here , but —also on
employers when, especially after the 2010 downturn,
they needed to lighten their workforce. And obviously,
if there was a mandatory retirement age, that was a
way to go about it without necessarily having to go through a whole bunch of redundancy payments and
this sort of thing.
I note that Senator Campbell spoke about, I
guess, looking for holistic approaches, and also, the
promise about people being able to work for longer
without permission being needed to do so. So, I guess
that brings me to a couple of comments and a question. And I will start with the question.
In [clause ] 3(b) of the amendment [to the pr oviso] . . . so, on page 2, it amends section 22. And it
inserts that once you go 65, you will need to provide a
medical fitness repor t to say that you are physically or
mentally capable to perform the roles in the job. Ho wever, it also says that it is going to be subject to “annual confirmation by the contributor’s Head of D eBermuda Senate partment to the relevant Permanent Secretary that the
contribu tor” (and here is the key bit, that the contributor) “is competent to discharge the duties of the post.”
So, when we talk about without needing permission to
do so, this clause specifically seems to me that you do require permission to continue to work. An d that is
from, basically, your superior or your supervisor or
whatever in the respective role.
So, I guess my question is, So, what comes
down to this? If the previous iteration of the Public
Service Superannuation Act basically forced people to retire a t 65, and therefore being retirement, there is no
redundancy payout for years worked, what happens if
you want to keep working? And if your doctor says
you are capable to keeping working, but the Perm anent Secretary or the head of the department, that
relevant Permanent Secretary, says that you are not
the right person anymore, is that considered a redu ndancy? Is it considered a retirement? So, I would certainly like some answers around that and how that
plays out to pay out costs to the government in this case.
What I will also ask is, seeing as this ageing
demographic and, obviously, the pension challenges
are more with the public service as opposed to private
sector pensions, but still the ageing demographic and
how we are going to confront that as a country is something that needs to be had. In the Employment
Act, there is no mandatory retirement age. So, any
mandatory retirement that people have in the private
sector is because it has been expressly included in
their employment contract. Now, some companies do
have that; some do not, because age discrimination is not covered under the Human Rights Act.
But my question is, this model seems like it
could work in a broader sense, whereby if there was a
mandatory retirement age, that after a certain age,
both employer and employee have a mechanism that
is the same across the board, whereby someone, because someone may at a certain point just want to
work a few less hours, or do whatever, but still want to
keep working. And for an employer, it is tough to
manage this, the weight of, say, 10– 20 years of accumulated redundancy, or 13, I guess, where it maxes
out, and the need to also promote internally and do
this kind of thing when people are waiting for opport unities to open up.
So, I would like to know, woul d this similar
sort of mechanism be considered for the Employment Act? And what happens when someone wants to keep
working past 65 and is physically fit, according to a
doctor, but their supervisor says, You’re not competent to discharge the duties of the post ? Thank you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, and good mor ning, Madam President and listening audience.
The Presiden t: Good morning.
Sen. James S. Jardine: I support this legislation not
just because I am over 68.
[Laughter]
Sen. James S. Jardine: But because I think there are
many of us who are well capable of working beyond
65. And I think this allows for that. Al so, not just because the Fiscal Responsibility Panel recommended
it, but also the SAGE Commission, upon which I
served on the subcommittee dealing with pensions,
and one of the recommendations that we did make at the time was to increase the retirement age beyond,
[what it is] currently, at 65. So, I think these are all
steps heading in that direction.
There are also a whole lot of other reco mmendations contained in the SAGE Report, dealing
with pensions, which I hope Government will look at in
due course. I know they have adopted some of them.
But it is a continuing process. So, I do support this Bill.
I had one question, and it is really a point of
clarification, I guess. I listened to the Senator’s
presentation. And I was trying to find out whether, once you reach the age of 68 and you have been gi ven permission to continue to work to age 70, do you
continue to contribute to the PSSF [Public Service
Superannuation Fund]? Or does that actually cease once you reach 68, regardless of whether you conti nue to w ork or not? Let me put that another way. If I am
continuing to work to age 70, do I have to make contributions to the PSSF during that two- year period of
time? And that is the one question of clarification that I had.
Apart from that, Madam President, I do support the Bill. Thank you very much.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
Senator Hayward, you have the floor.
Sen. Jason Hayward: Good morning, Madam Pres ident.
The President: Good morning.
Sen. Jason Hayward: Madam President, I whol eheartedly welcome this Bill that is put forward by the Government. I was responsible for chairing the LAC
[Labour Advisory Committee] Subcommittee, who explored this whole topic regarding the retirement age
and age discrimination. And it was the committee in
which I chaired that provided the recommendations
that Senator Campbell read before us today.
616 29 July 2019 Official Hansard Report
Bermuda Senate The first thing the committee did was diagnose whether or not there is a problem. And we recognised that there i s a problem. Senator Kempe hig hlighted some of the challenges regarding the financial hardship that persons do have transitioning from a working individual to a pensioner. We also recognised
that there were problems with the funding of our Public Service P ension Fund, and we asked ourselves,
Would changes in that direction assist with the problem?
The other thing we had to recognise was that
Bermuda’s population is ageing. And so, the dem ographic makeup of our population is changing, and it
is rapidly chan ging to an ageing population. As a r esult, there had been no real shift in the way in which
employers were treating persons as they reached the
age of 65, even though life expectancy was longer.
We looked at the other measures, such as
persons not just t ransitioning from the workplace to
being a pensioner, but persons transitioning from the
workplace to [signing up for] Financial Assistance. So, this week they are working; next week, you can retire;
and you find that you are not making ends meet, and
you sign up for Financial Assistance.
We also looked at the fact that Government
had, the previous Government had allowed, and it continued under this Administration, for persons to retire under our early retirement incentive scheme.
We found that persons wer e taking their early retir ement incentive scheme and then knocking on the former employer’s door to try to get employment back.
What they have found is that they could not sustain
their financial obligations in society on the funds that they were receiving from the early retirement scheme.
Working beyond the age of 65 is not unco mmon in Bermuda. There are thousands of persons . . .
I think in the last census, there were 2,530 persons 65 and over working in our population. And so, that gives
us an idea of t he capability of persons to work over
65. That number actually increased from the 2010 Census.
What was highlighted in the last census also
was the unemployment rate for those persons 65 and
over. Now, naturally, you would not have an unemployment rate for those 65 and over, because they
would not be considered as part of the active wor kforce or actively seeking or looking for work. But in
this particular instance, it had tripled the number of
persons who were actively seeking work over the age
of 65. And so, it spoke about the demands in our s ociety to make some sort of change.
Changing the pension age society -wide is a
little bit more difficult. And I think beginning with the
public service is a good idea. When we looked at ot her societies, the majority of the developed European
societies, they have removed retirement age. It is all very flexible when it comes to retirement ages. And
so, when speaking with some colleagues, some colleagues currently have mortgages that will extend be-yond their age of 65, due to their need to refinance
during the [economic] downturn and things of that nature. And so, this would help individuals a lot.
But we have to look at it and say, This is not
just for health. This is about recognising that people are still capable to p erform at a high level at age 65.
Certainly, there will be some jobs which we would
have to review, based on their physical requirements,
and to determine if somebody is still capable of doing
the job. And I think that is where the assessment from
the supervisor is needed. I do not think it is one of those subjective things that will be put in place. You
will note that all public servants are protected by the
Bermuda Public Service Union. And in order for
somebody to be denied, certainly there would have to
be valid grounds. But I do not think the aim is to shift the retirement age, to then continuously deny indivi duals. That makes absolutely no sense to the aims and
objectives that we are trying to achieve.
Like Senator Kempe did state, many persons
agree to retire at age 65 through their employment
contracts. And I believe many persons are not aware
that they actually agree to retire at age 65 in their employment contracts when they begin employment. And
if I just look at myself, as a younger individual, w hen I
went to sign the employment contract, the last thing I
was probably worrying about was 30 to 35 years down
the line. And so, we do have a defined retirement age specified in the National Pension Scheme legislation.
It does have a section in there that says pension age,
and does speak to 65. And that is the age in which the
insurance companies actually abide by.
What this Bill actually does is allow persons to
work to the age of 68. We believe, through our r esearch, that 68 was a good . . . was a suff icient time
period for the first adjustment. Ultimately, we are pr oposing that persons work up to 70. But as you know,
in the public service, persons still do have rights to
work up to 70. And this is at the discretion of the Head of the Civil Service.
Madam President, when we reviewed the data, there was not a one- to-one relationship with our
younger workers. So, it is not, an older worker retires,
and then somehow it creates space in the public service for a younger worker. What we find in the public service is that, when an older worker retires, most
times, their jobs are filled by a more experienced or
older worker. It all depends on which job category
they are actually in. But based on our ageing popul ation, sometimes you replace an older Bermudian worker with a younger or older non- Bermudian wor ker. That can also be a factor. So, it was not a one- toone relationship, where there are younger workers
being prohibited from entering the public service b ecause persons are working longer.
You should also ap preciate that the public
service has a natural attrition rate, where persons
leave the public service for a number of reasons.
When persons leave the public service, for a number
Bermuda Senate of reasons, I mean, that also creates opportunities for
persons coming in and filling vacant posts.
These provisions also go a long way in creating a more sustainable Public Service Superannuation
Fund. Obviously, if persons are working longer, they are contributing more. And also, the liability for . . . the
Government is able to reduce its liability and defer the
liability for a longer period of time. And that is a pos itive step. The actuary has actually advised that this
will not be a meaningful step, and it will give the Public
Service Superannuation Fund some additional life.
I think that these changes are timely. They
make sense. I think that anybody viewing these
changes will see that they are in benefit of our society.
And I thank the Government for bringing them for-ward. Thank you, Madam President.
The President: Thank you, Senator Hayward.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, you have a
couple of questions to respond to.
Sen. Vance Campbell: Thank you, Madam President.
Madam President, it is good to have a summary by the Chai r of the subcommittee that put forth
the recommendations, and I appreciate that, coming
from Senator Hayward.
So, from there I will deal with the questions,
Madam President, that were put forward. The first being, What happens if an employee wishes to continue
to work? The doctor says they are competent to work,
but the head of their department says they are not fit to continue to work. There will be no redundancy in
that instance, Madam President. There would simply
be the retirement at the age of 68. So, they will r eceive their pension and the like.
There was also a suggestion/question from
Senator Kempe, saying that this makes sense and
could work in a broader sense, being in the private
sector, I assume. Is that correct, Senator . . . Madam
President, is that correct that he was referring to the
private sector, that this could possibly work?
The President: Senator Kempe, do you want to r espond to the question?
Sen. Nicholas Kempe: Yes. I was referring to the
broader Bermudian economy, both private and public.
The President: Thank you.
Carry on, Senator.
Sen. Vance Campbell: Well, that would actually fall
under the Ministry of Labour and Home Affairs and
would be a matter for that Ministry to consider.
Sen. Nicholas Kempe: Point of clarification?
The President: Will you accept a point of clarification,
Senator?
Sen. Vance Campbell: I will accept it.
The President: Yes. Carry on.
POINT OF CLARIFICATION
Sen. Nicholas Kempe: Yes.
I believe the Public Service Superannuation
Act would be subservient to the Employment Act, but I
am not entirely certain on that.
Do you know?
Sen. Vance Campbell: We would have to take that
under consideration, Madam President.
The President: Thank you, Senator Campbell.
Carry on.
Sen. Vance Campbell: And there was a lso one final
question, regarding once a person reaches the age of
68 (I think this was coming from Senator Jardine) and
they choose to continue and are allowed to continue
to age 70, do they still contribute to the PSSF? And
the answer to that would be yes, they do.
So, with that, Madam President, I move that
the Bill entitled the Public Service Superannuation
Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
the Standing Order 26 be suspended in respect of this
Bill.
The President: Is there any objection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Public Service Superannuation
Amendment Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Carry on.
618 29 July 2019 Official Hansard Report
Bermuda Senate BILL
THIRD READING
PUBLIC SERVICE SUPERANNUATION
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Public Service Superannuation Amendment Act 2019 do no w pass.
Is there any objection to that motion?
No objection. The Bill is passed.
[Motion carried: The Public Service Superannuation Amendment Act 2019 was given a third reading and
passed.]
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The President: The second Order of the Day is the
Fund Administration Provider Business Act 2019. And
I believe that is Senator Campbell.
The second Bill is yours as well, Senator
Campbell?
Sen. Vance Campbell: That is correct, Madam Pres ident.
The President: You have the floor when you are
ready.
[Pause]
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Fund Administration Provider
Business Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
BILL
SECOND READING
FUND ADMINISTRATION PROVIDER
BUSINESS ACT 2019
Sen. Vance Campbell: Thank you, Madam President.
Madam President, I am pleased to present the
Fund Administration Provider Business Act 2019 [the
Act] for the consideration of the Senate. The Bill seeks
to enhance Bermuda’s supervisory and regulatory regime for those engaged in fund administration pr ovider business, an important segment of Bermuda’s
financial services sector.
Madam President, by way of background, in
March 2018 a discussion paper entitled “Proposed
Enhancements to Investment Business, Investment
Funds, and Fund Administration Regimes” was issued
by the Bermuda Monetary Authority (the BMA, or A uthority). As indicated in this paper, input from industry stakeholders was sought regarding proposed modif ications to the framework in place for these sectors.
Following the feedback received from the discussion
paper, the Authority made a commitment in its 2018
business plan to support the introduction of the legi slative proposals in respect of fund administration bus iness. And this proposal involves enacting a new
standalone fund administration Act, the Fund Admi nistration Provider Business Act 2019.
Madam President, the Fund Administration
Provider Business Act 2019 is the first of a series of
enhancements to the investment business and i nvestment fund regimes proposed in the March 2018
discussion paper. Madam President, the Fund Admi nistration Provider Business Act 2019 is derived from
the original Investment Funds Act 2006 (the IFA)
which provides the legislative basis for Bermuda’s investment fund and fund adm inistration businesses.
While the IFA 2006 has been subject to amendments
over time, these amendments have tended to be ad
hoc in nature, addressing specific issues and partic ular circumstances related to investment fund vehicles. However, with the evoluti on of the fund business, it is
the Authority’s view that its oversight of fund admi nistration businesses, and investment fund products,
will each be better accomplished via separate legisl ative frameworks. Furthermore, introducing a legislative
regime that is specific to fund administrators will put
this sector on the same footing as other regulated f inancial institutions in Bermuda.
Madam President, the Authority has proposed
that a majority of the existing provisions within the
IFA, related to the fund administration business, pr edominantly found within Part III of the IFA, be incorp orated in the new Fund Administration Provider Bus iness Act 2019. When developing the new Act, the
Authority sought to ensure that relevant provisions of
the IFA were updated where appropriate in the new
framework so as to be consistent with how compar able provisions are presented within recently adopted
legislation covering other regulated financial instit utions.
Madam President, the new Fund Administr ation Provider Busines s Act 2019 seeks to provide
consistency and clarity in respect of how fund admi nistrators exercise their functions and how the Authority supervises them. Key aspects of the regime for fund
administrators, which have been subject to enhanc ement in the new B ill, include:
Bermuda Senate 1. carrying on fund administration business
in or from within Bermuda;
2. safeguarding of other assets for clients;
3. minimum criteria for licensing;
4. statement of principles;
5. reporting requirements; and
6. new code of practice.
Madam President , I will n ow elaborate on
each of these points.
Point 1: Carrying on fund administration bus iness in or from within Bermuda. This section is derived from section 41, Part III, of the IFA and is a core
element of the current fund administration business
regime. This section prohibits a person from carrying
on the business of a fund administrator in or from within Bermuda without a licence. The Authority b elieves that additional certainty is required with regard to when one would be considered to carry on or purport to carry on the business of a fund administrator in
or from Bermuda.
Accordingly, this legislation provides that fund
administrators will correctly be regarded as carrying on fund administrative business within Bermuda if
they occupy premises in Bermuda or make known, by
way of website, promotional materials, legal doc uments, or letterheads, that they may be contacted at a particular address in Bermuda, or are otherwise seen to be holding themselves out as engaging in or carr ying on fund administrator business in or from within Bermuda.
Furthermore, the Act makes it clear that a
company incorporated in Bermuda shall not carry on the business of a fund administrator anywhere in the world without being licensed by the Authority.
Point 2: Safeguarding of other assets. The
Act makes provision for Bermuda licensed fund administrators to provide, subject to a specific applic ation process, certain safeguarding services for other
assets only, and not in respect of financial instruments
or client monies.
It is intend ed that fund administrators which
provide any such safeguarding services will be subject to additional obligations, which will be contained within the regulations which can be made by the Minister of
Finance pursuant to the new Act and an updated
Code of P ractice, which the Authority will be empo wered to issue. Licensees who are granted permissions
to provide such safeguarding services in respect of
their clients’ other assets will be subject to additional
reporting and disclosure obligations including the r equirement to prepare audited financial statements submitted to the Authority on an annual basis.
Point 3: Minimum criteria for licensing. The
minimum criteria for licensing of fund administrators is
currently set out in the Schedule to the IFA. The A uthority must be satisfied that the minimum criteria are
met and continue to be met by entities seeking to be licensed or which are currently licensed as fund administrators. The new Act updates the existing mini-mum criteria for licensing to ensure that the provisions
contained therein are consistent where appropriate
with those reflected within recently adopted legislation
covering other regulated financial institutions.
For example, Madam President, the Act
strengthens the existing requirements for business to
be conducted in a prudent manner by adding a prov ision specific to maintaining adequate accounting and
other records, along with accompanying systems of
control and associated policies and procedures. Also,
further emphasis is given to corporate govern ance
obligations, by reflecting these obligations ind ependently rather than as a subset of the fit and proper
persons criteria.
Point 4: Madam President, in relation to
statement of principles, the new Act requires the A uthority, consistent with other supervisory Acts for f inancial services providers, to publish, as soon as
practicable after the legislation comes into force, a
statement of principles which identifies the manner in
which the Authority proposes to act in respect of the
following:
(a) interpreting the minimum criteria specified
in the Schedule to the Act and grounds for
revocation;
(b) exercising its power to grant, revoke or
restrict a licenc e;
(c) exercising its power to obtain information
and reports , and to require production of
documents; and
(d) exercisi ng its power s to impose a civil
penalty, censure publicly, make prohibi-tion orders and publish information about
any matter to which a decision notice r elates.
Point 5: Reporting requirements. Section 47
of the IFA requires fund administrators to submit an
annual statement of compliance to the Authority, but the information to be included in this statement is general in nature. In keeping with international best
practice in this area, the Act expands and makes
more specific the requirements of the statement of
compliance by way of the following:
(a) requiring that the statement of compliance
be signed by two directors, one of whom must be the chief executive or equivalent
officer;
(b) introducing more extensive confirmation
requirements; and
(c) providing the Authority with the power to,
upon application, grant an extension in r elation to the filing of an annual statement
of compliance.
Madam President, a lso, it is proposed that
fund administrators be subject to new requirements
with respect to the filing of annual fina ncial stat ements, including a requirement for the appointment of
an auditor and the filing of annual audited financials in
the instances where the fund administrator has been
620 29 July 2019 Official Hansard Report
Bermuda Senate approved to provide safekeeping service for the cl ients’ other assets.
Point 6: Madam President, in relation to code
of practice, the Act makes provision for such a code to
be issued. In this regard, it is proposed that the exis ting code of conduct for fund administrators be revised
to achieve alignment with, among other things, the
revisions to be made to the minimum criteria for l icensing.
Madam President , I can confirm that there are
currently 27 fund administrators licensed under the
existing IFA regime, which we would expect to be l icensed under the new regime once it comes into
force.
Madam President , I wish to emphasise the
Authority sought input from stakeholders on all of
these provisions in March 2018, by means of the
aforementioned discussion paper and via a consult ation paper and draft Bill issued in April 2019. This Bil l
represents a collaborative effort between the Authority and various industry stakeholders. Accordingly, I would like to thank all of those persons within the
Bermuda Monetary Authority, the Attorney General’s
Chambers, the Minist ry of Finance and the pri vate
sector who have assisted with the development of this
Bill.
With those remarks, Madam President , I
pause to allow other Senators to speak. Thank you, Madam President.
The President: Thank you, Senator Campbell.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: And before we do that, I would just
like to acknowledge the presence of Mr. Ifor Hughes
from the Bermuda Monetary Authority, who is in the
Chamber this morning. Thank you.
[Fund Administration Provider Business Act 2019,
second reading d ebate, continuing]
The President: Would any Senator care to speak?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident.
We understand that there was sufficient i ndustry consultation, and we have no objections to this
Bill.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No. Then, seeing that you have full support,
Senator Campbell, over to you.
Sen. Vance Campbell: Thank you, Madam President.
And thank you, Senators, for your support.
Madam President, I move that the Bill entitled
Fund Administration Provider Business Act 2019 be
now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
SUSPENSION OF STA NDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
Standing Order 26 be suspended in respect of the Bill.
The President: Is there any objection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. V ance Campbell: Madam President, I move that
the Bill entitled Fund Administration Provider Business
Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
BILL
THIRD READING
FUND ADMINISTRATION PRO VIDER BUSINESS
ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Fund Administration Provider Business Act
2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
[Motion carried: The Fund Administration Provider
Business Act 2019 was given a third reading and
passed.]
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The Presiden t: We now move on to the third [Order]
under the Orders of the Day. And that is the second
reading of the Employment (Wage Commission) Act
2019.
Bermuda Senate Senator Hayward, this is your Bill. You have
the floor.
Sen. Jason Hayward: Madam President, I move that
the Bill entitled Employment (Wage Commission) Act
2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator, Hayward.
BILL
SECOND READING
EMPLOYMENT (WAGE COMMISSION) ACT 2019
Sen. Jason Haywar d: Madam President, I am
pleased to introduce the Bill entitled the Employment
(Wage Commission) Act 2019 , which seeks to set up
a Wage Commission in order to report on and recommend a minimum and living wage regime for Bermuda.
Madam President, as my Senate colleagues
will be aware, on the 10th of August 2018, a motion
was brought before the House of Assembly for the
consideration and approval of the Parliamentar y Joint
Select Committee’s report on the establishment of a minimum/living wage regime. Among other recommendations in the report is the establishment of a
Wage Commission.
Madam President, the report was approved,
and the November 2018 Throne Speech conf irmed
Government’s commitment to implementing a minimum/living wage regime. Madam President, the International Labour Organization, or ILO as it is commonly referred to, defines minimum wage as (and I quote)
“the minimum amount of remuneration that an employer is required to pay wage earners for the work
performed during a given period, which cannot be r educed by collective agreement or an individual con-tract.”
The purpose of a minimum wage is to protect
workers against unduly low pay. Madam President, the days of Bermudians being able to pick up and
choose jobs are gone. The current economic climate
puts the demand- and-supply equation for labour in the
employer’s favour. Unskilled workers now have to
compete for jobs, and exploitation of workers is occurring. We have all heard of people who are making
$5.00, $6.00, and $7.00 an hour, and this is occurring
in Bermuda, which has one of the highest costs of
living globally.
To illustrate, Madam President, Honourable
[Senators] may be aware of a job advert earl ier this
year in which persons were looking to hire a live- in
caregiver. The job responsibilities listed were to take
care of an elderly person suffering from dementia,
clean, cook, provide companionship, run errands, work five days a week from 9:00 am to [9:00 pm], and
be on call seven nights a week. The successful candidate would have two days off, but would have to prep
meals before leaving, and make $10.00 an hour, less
room and board. Madam President, I think we can all
agree that this embodies the ter m “exploitation.”
Madam President, this Bill seeks to provide
for the establishment of a Wage Commission, which will be mandated to enquire into the provisions of a
statutory wage scheme with the objective of making
recommendations on a minimum hourly wage and a
living wage rate, which would be prescribed by the
Minister responsible for Labour. Madam President, the
composition of the Wage Commission will consist of a
total of eight persons: a chairman, five members and
two ex officio members representing t he Ministry of
Finance and the Ministry responsible for Labour.
Members will be appointed by the Minister responsible
for Labour for a period of three years and have broad
experience and expertise in economics, law, statistics,
and other suitable qualifications.
Provisions will be made to pay the Members
of the Commission in accordance with the
Gover nment Authorities (Fees) Act 1971 . The fee is set at
$100 per meeting for the chairman and $50 per meeting for the members. A consequential amendment to
the Government Authorities (Fees) Act 1971 will be
made.
Madam President, to facilitate the proceedings of the Commission , the Bill authorises t he Mini ster to designate a public officer to be the secretary to
the Commission , thereby reducing the need for additional administrative costs.
Madam President, the Bill stipulates that the
functions of the Commission are to make recommendations on the mi nimum hourly wage and the living
wage rate. To fulfil this mandate, the Commission is
required to conduct research, enquiries and analysis,
and to consult extensively to ensure that all stak eholders —including employers and employees, and
organisations repr esenting employers and emplo yees—have the opportunity to make a contribution.
Should the Commission require information from an
employer or employee or some other person, they will
be able to compel persons in writing to supply the i nformation and appear before the commission. The
Commission will also have the power to take copies of
the documentation provided.
Madam President, every three years, the
Commission will be required to make a report to the
Minister responsible for Labour with regard to the pr oposed minimum hourly wage. It may be necessary for
a review within the three -year cycle in the event of a
significant economic change in Bermuda or unfor eseen consequences of the minimum or living wage that need to be researched and rectified.
Madam Presid ent, the Bill sets out the r equirements for the content of the report that the Commission is to submit to the Minister, which i n622 29 July 2019 Official Hansard Report
Bermuda Senate cludes (1) the determinations of the Commission on
the findings and conclusions of the research, enqui ries, consultations and recommendations; and (2) the
subsequent recommendations and the reasons for the
recommendations. Madam President, the Bill requires that the recommendations must include an analysis of
the impact on the economy of Bermuda, the compet itiveness of the economy of Bermuda and any other
issue that may have been raised by the Minister r esponsible for Labour.
Madam President, once the Minister has r eceived the report, he will be obliged to table it for the House of Assembly and the Senate, and may by order
prescribe the minimum hourly wage.
Madam President, a living wage is different
from a minimum hourly wage in that it purports to pr ovide a decent standard of living for the worker and his
or her family. Madam President, as with the minimum
hourly wage, the Commis sion is also mandated to
make a report to the Minister responsible for Labour
every three years with a proposed living wage rate. The requirements for the production of the report are
the same for the determination of the living wage rate
as they are for t he minimum hourly wage. Once the
Minister has received the report, he or she must table
it in both Houses of the Legislature, and may by order
prescribe the living wage rate.
Madam President, the Commission’s powers
are accompanied by enforcement measures . Persons
who fail to produce any record, document or information; intentionally delay the work of the Commi ssion; or refuse to answer any questions are subject to
a fine not exceeding $2,000 and $100 for every day that the offence continues. In the case of a corporate
entity, the fine will be $7,000 and $500 for every day
that the offence continues. Madam President, the Bill
provides a regulation, an order -making power, for the
Minister, which will enable him or her to prescribe the
minimum hourly wage, the living wage rate and any
matters that are necessary for carrying out the prov isions of the Bill. The regulations will be made in due
course following the Wage Commission’s report and
recommendations.
Madam President, we are clearly well behind
the times internationally in the establishment of a mi nimum wage. The ILO asserts that more than 90 per
cent of their 186 member states have one or more
minimum wages set through legislation or binding co llective agreements. Today we are on the road to ma king a livi ng wage a reality for Bermuda. Our people
deserve to live in dignity. They deserve to enjoy decent work. And a part of that is to provide for a living wage, and this legislation will make it happen.
In conclusion, I would like to thank the Parli amentary Jo int Select Committee for their work in the
production of the report and on the establishment of a minimum/living wage regime. Thank you, Madam
President.
The President: Thank you, Senator Hayward.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITORS
The Presi dent: I would, at the time, like to
acknowledge the presence of the Permanent Secr etary, Chris Farrow, policy analyst, [sic] as well as Jane
Brett, policy analyst . . . Sorry. Jane Brett is the policy
analyst. But anyway, the Senate welcomes both of
you to the Senate.
[Laughter]
[Employment (Wage Commission) Act 2019, second
reading debate, continuing]
The President: And now back to the business at
hand.
Would any Senator care to speak on this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident. Thank you, Senator Hayward.
Certainly, ensuring that people are able to live
in Bermuda on what the most basic of pay rate allows
is an important thing to ensure that we achieve. What
I am certainly struggling with, and this is where, I
guess, the devil is always in the details, is what . . .
when I was on the Joint Select Committee which
seems to have preceded this Commission that will
then determine what the wage is, one of the key things we, at least I, struggled with was the detail of breakdown that we could get from the Office of the
Tax Commissioner.
Obviously, and this seems to have fallen off a
bit with the Living Wage Commission Act from the m otion laid in another place that set up the Joint Select
Committee that s eemed to target the effect of foreign
workers on lowering the . . . essentially the market
price for labour at the lower end of the pay scale, and
[what] effect [it] may have had on Bermudian workers.
But again, that was the assumption put forward in the motion. And it was really hard to find the supporting
data behind that because the Payroll Tax Commission could say that certain industries paid “X” or “Y,” but
they could not say to whom on a kind of broader demographic scale they were falling to.
So, tha t made it kind of difficult to understand
what the effect of the living wage would have on di fferent groups of people. Obviously, there is a living
wage for someone working in Bermuda with a family,
with children, with all these things in Bermuda. And I
know this [about] the Wage Commission Act now, the
cost of child care is included in the living wage. So,
and again, this raised problems when we were di scussing it, theoretically, at the Joint Select Committee
level, well, how do you set the wage on no- children,
Bermuda Senate one-child, two- children, three- children, et cetera? And
as those are individuals’ choices, is that a burden that
should be borne by an employer, by the Government?
How are we passing on these costs?
And if a certain wage was raised, would all
that i ncome go . . . would that all of a sudden entice
Bermudians to work in those industries? Would it
simply be increasing the amount of foreign cash sent
overseas for people who are able to, essentially, r educe their cost of living in Bermuda as they are, you
know, looking for economic opportunity, and this kind of thing? And I say that not . . . there is a clear distinction between exploitation and people who choose to,
say, bunk as an adult because their spouses and chi ldren are back home. And that is a beneficial short -
term economic position for them.
The other struggle was with tipped wages.
And the numbers from the Payroll Tax Commission
and other reports seem to only capture what is the
base pay and not the amount of money earned in gr atuities. So, one c ould say someone is earning $8.00
an hour as a flat wage, but they could effectively be
taking home $24.00, $25.00 because of the way that
industry has developed its payment and reimburs ement culture, based on kind of a profit share on vo lume of business done.
And there did not seem to be any really good
data for us to make decisions, and what positions taken could, you know, adversely affect the employees,
adversely affect the business operators and/or completely cost -out hospitality as a destination, depending
on which way those assessments were made. But
again, there was a rather glaring lack of, kind of, ec onomic data which we could come to unbiased recommendations on. So, I am assuming that the reason
another commission was set up after the previous
committee was to continue to academically research
this and get some good data so that we can have a
policy which protects employees, insures that the cost
of business and the cost of living in Bermuda are not
radically skewed and that allowed people who want to
work to not feel like they are being excluded simply
because there is exploitation- level wages or expect ations coming out of it.
So, we certainly support the continued work of
this Commission . But we would like to see what
comes out of it at the end and how much consultation
and research have been done accordingly. Thank
you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, Madam Pres ident.
Madam President, there are many studies and
articles surrounding the subject of minimum wage and
the benefits, the real benefits of implementing such a regime. Obviously, there are also studies showing the
economic, possible economic downsides of impl ementing a minimum wage scheme, as well.
Additionally, while there have been attempts
at calculating the so- called living wage, which is quite
different from the minimum wage, as we have heard
earlier on today, there are very few countries that are
actually implementing a living wage on a required,
legal basis. There are a number of countries that have
voluntary living wage amounts, but very few that have
actually implemented a living wage regime.
The UK is one of the few countries that has
attempted to move in the direction of establishing a
living wage, having recently established a new nation-al living wage payable to workers over 25, effective in
April of 2016. This wage rate is substantially higher
than what was the national minimum wage rate, but in itself is n ot a true living wage rate. It is something less
than a true living wage rate, some fall somewhere in
between that. And its aim is to reach a wage rate level
of about 60 per cent of the median UK earnings.
A living wage rate has been determined by
many co untries and cities around the world, as I said.
But most of them are voluntary. However, in the Uni ted States, for example, there are 122 living wage ordinances in American cities. So, they are not necessarily state- wide. They are not necessarily federally
implemented. But there are some ordinances that ex-ist in the cities in the United States. So, the living
wage is not something that is new, but it is something
that is being implemented in few countries around the
world, and it tends to be in cities and ordinances.
My own view on this complex subject is there
can be real benefits to those who remain employed after the implementation of a minimum wage regime,
and that the possible economic downsides depend
entirely on the country in which the minimum wage is
being implemented, its own economic circumstances
and, probably more importantly and just as key, the level at which the minimum wage is set. And we have
heard some questions this morning about whether the
minimum wage, for example, would include tipping or
exclude tipping. And if so, how is it calculated?
Studies have shown that some cities within
countries, the implementation of a minimum wage has had a positive impact on employment, while in others,
it is not entirely clear what that impact has been, neither negative nor positive. Additionally, certain types
of businesses have been affected positively or neg atively more than other businesses. There are 159 countries around the world that have a minimum wage at present. And they include USA, Canada, th e UK,
Australia, France, Germany and many more. The
Cayman Islands, the BVI, the Bahamas, Barbados, St.
Kitts, Trinidad and Tobago all have minimum wage
regimes. And they have legislation in place. So again,
what we are debating or what we are discussing t oday
is not something new.
624 29 July 2019 Official Hansard Report
Bermuda Senate Now, before I go any further, just to put ev erybody at rest, I want to say I am in favour of establishing a wage commission. So, I will put that behind
us, and then we can move on to some other points. I
think it is important we do have a wage commission.
It will be the work and recommendations of
this Commission that will be absolutely critical in d etermining the outcomes of establishing a minimum wage. All those who live and work in Bermuda should
be able to live with dignity, as we have heard, and be
able to feel that they are not intimidated in the wor kplace or feel uncomfortable about complaining about the wage rate, which many feel at present. And I think
we have heard that there are some employers who
are taking advantage of that, both Bermudian and
non-Bermudian staff.
I want to say that it applies not only to the
wages that some workers are being paid, but in some
cases the living conditions in which some of our wor kers have to exist. And I do not want to let that go wit hout some mention. It is not just the wages that are
being paid, but it is the living conditions in which some
of these workers are having to exist.
So, Madam President, it is a delicate balance
that we have to keep between paying a fair wage for a fair h our’s work whilst at the same time being alive to
the effects that an increase in operating costs may
have on businesses in Bermuda. And as I said during
our discussion on the amendments to the Health I nsurance Act, a company has a number of options that
they can adopt when costs go up, one of which is
simply to increase the price that it charges us for its
goods and services.
So, as was stated in another place 10 days
ago, Bermuda’s cost of living is a major concern for
Bermudians. And when the Wage Commi ssion meets
to consider a minimum wage, it will, as required under section 10 of this Bill before us, Madam President,
have to make, in conclusion, if I may quote from section 10 —
The President: You certainly may.
Sen. James S. Jardine: It says, “shall s pecifically
state the effect of the determinations made . . . on the
economy of Bermuda as a whole.” So, that is one of
its requirements that it has to fulfil as it comes up with
a minimum wage.
The big question is, Will the establishment of
a minimum wage and eventually a real living wage
result in a loss of jobs? As I have said already, there
is an enormous amount of literature on this topic. And there are studies which suggest that there will be job
losses, and others that show that there will not be job
losses. There is a huge amount of literature out there.
And I must say, I did not plough through all of it, but ploughed through some of it. And I just wanted to refer
to one or two pieces. The first one is an economic r eport written by the Federal Reser ve Bank of San Francisco, dated December 21
st, 2015. And they conclude, on page 5 of their report, after examining a
great deal of evidence, and if I may quote them, Madam President?
The President: You certainly may.
Sen. James S. Jardine: They say as fo llows: “ Coupled with critiques of the methods that generate little
evidence of job loss, the overall body of recent ev idence suggests that the most credible conclusion is a higher minimum wage results in some job loss for the
least -skilled workers —with pos sibly larger adverse
effects than earlier research suggested. ”
Now, the key to that is, and I just want to r epeat that. The conclusion is a higher minimum wage results in some job losses. So, to me the critical point
is, what rate do you set for the minim um wage? And
that will determine, to some extent, whether or not it
has any significant impact on existing jobs. So, it is
important that the Commission get the minimum wage
rate right.
And I will make one further interesting observation from a detailed s tudy carried out by Meer &
West from Texas A&M in 2015, in which they co nclude as follows —and if I may quote them, Madam
President?
The President: Certainly. You certainly may.
Sen. James S. Jardine: They say the following: “ The
voluminous literature on minimum wages offers little
consensus on the extent to which a wage floor i mpacts employment . . . [W] e argue that the effect of the
minimum wage should be more apparent in new employment growth than in employment levels . . .” (And
that is key, new employ ment growth rather than current employment levels.) “[W]e find that the minimum
wage reduces net job growth, primarily through its
effect on job creation by expanding establishments. ”
(So, that is establishments that are already existing
and looking to exp and.) “These effects are most pr onounced for younger workers and in industries with a
higher proportion of low -wage workers. ”
So, they also say in their report, and I did not
quote it here, but they also say in their report that, for
new businesses that are seeking to establish, they will
be looking at the minimum wage rate. And if it is of a
sufficiently high level, they will look to automate in a
more effective way rather than hire additional staff.
So, I just wanted to stress that. They are tal king about new employment growth, not necessarily those jobs that already exist.
So, Madam President, you know, there are
many information papers available online, which shows that certain jurisdictions have dealt with deter-mining minimum wage in different ways. Now, I know I
am going to be criticised for referring to our neigh-bours to the south. But we can learn from them, as
Bermuda Senate they have learned from us many times in the past.
And if you will allow me just to mention one.
The President: Absolutely, you can.
Sen. James S. Jardine: And I am referring to the
Cayman Islands. They went through this exact same process in 2015. And their minimum wage advisory
committee report issued in February of 2015 was extremely informative. Now, it is 220 pages, and I am
sure people do not want to plough through it all. But if
you do plough through it, it sets out a very good
guide line of what they followed in coming up with their
minimum wage. Now, I am not suggesting that we
should just blindly copy what they did. But it does pr ovide something for our Wage Commission to at least
read, if they have not already read it, to give them some idea of how they might want to approach coming up with a minimum wage.
And it includes a lot of things that are mentioned in our Bill here that shou ld be considered. They
actually go through the process, so you can see how they have determined what, for example, economic
impact it would have. Now, they have set their minimum wage at CI$6.00 per hour, which is about
US$7.20 per hour. So, as I say, they actually also
brought in the ILO to give them advice. And we have
heard Senator Hayward refer to them in his opening
remarks. They were heavily involved in their process,
as well.
The report from the Bermuda Joint Select
Committee on this report was also very informative.
And I did go through all of that several times. And it showed the work that they have carried out. And it
also acknowledged, on page 9 of their report, and if I
can quote it, Madam President, because I think it i mportant again.
The Pres ident: You certainly may.
Sen. James S. Jardine: And they said as follows: “ It
is acknowledged that the analysis conducted has lim itations, and the members are also cognizant of the
unintended consequences that can arise if this pr ocess is not well consul ted and well thought out. ” So,
they themselves recognise that the process that this
Commission has to go through has to be fairly consu ltative. It has to be fairly detailed so the rate that they
come up with at the end of the day is something that
is fully supportive.
Madam President, on pages 13 to 21 of the
Joint Select Committee [report], and again they came up with certain insights, they provided certain insights
to the various methodologies that are used throughout
the world. And I believe there were three different versions. And it was useful to see that. And one of those indeed was the one that was selected by the Ca ymans in coming up with their minimum wage rate. The Joint Select Committee also recognised
the importance of the effect of the minimu m wage levels on the cost of living in Bermuda. So, they do not
just blindly send this out. They did actually consider it.
And I wanted to quote specifically from them. (And I am looking at Senator Richardson, because I think he
is going to fall into play here.) And it says, if I may
quote them, Madam President.
The President: Yes, you may.
Sen. James S. Jardine: They say, “The Cost of Li ving Committee is equally as important, as they review the competitive economic environment to assess
whether or not a lack of competition within key ec onomic sectors artificially inflates the cost of goods and services.” So, there is a sort of dynamic role being played by the Cost of Living Committee and by this
Commission, working in tandem as they go through
this proces s. And again, that is, in my mind, a very
important process.
So, Madam President, there is a huge amount
of literature out there. And I think what you read today
may be different from what you read yesterday. I think
the key point I want to get across is that the level that
is set for the minimum wage will determine what i mpact it has on cost of living. It will impact . . . probably
going forward, not so much for the existing jobs, but
for job creation, it will impact the jobs that may or may
not be created in the future. And I think that is i mportant.
There were two comments I wanted to make
on the Bill itself. And the first, if I may refer to them, Madam President, was clause 3(2)(a)(iv), clause
3(2)(b)(i) (it gets very complicated), and clause 3(4),
addressing young persons. And I see that the Bill
does not apply to anyone under the age of 16. But any
students above the age of 16, subject to certain r equirements of other Acts, are caught by this Bill.
And it just seemed to me that, if we are going
to sa y that students between the ages of 16 and, let
us just say 22 or 23, are subject to this Bill, and ther efore, those higher rates have to be paid, that may have an impact on summer employment or indeed on
holiday employment. If the rates are too high, bus inesses that might normally have taken students in
and paid them something fair and reasonable just
simply may not hire them.
So, my concern is if students between the
ages of 16 and, say, 22 are impacted and do have to
fall into this regime, they may find it more difficult to
obtain jobs. And I just sort of sound that note of caution and concern. And again, there are studies out
there that have shown that, in fact, it has had no i mpact, and studies that have shown that it has had an
impact. So, I think we just need to be alive to that one.
Clause 7 appears to give the Commission
fairly broad powers to request information (and I quote from the clause) “such record or documents” as they
626 29 July 2019 Official Hansard Report
Bermuda Senate may request. Madam, I understand that the Commi ssion needs to get inform ation, and they should get
information that is relevant to the work that they do.
My concern is that they want to get information that is
relevant to what they are doing, and hopefully will not be going and looking for information that is not rel evant.
And I guess one small amendment that I
would suggest might be that the Government look at
and consider, and it is in clause 7(a), which could
read, for example, “to supply that information” and “[(b)] to [produce] such record or documents as may
be specified” —and this is the bit that I would add—
which might reasonably be required.
Now, I suppose . . . I am not a lawyer, but that
seems to be a term that lawyers love to use, it might
reasonably be required, because they can argue that
it is not reasonably requ ired. But it is just something
that I think, as a cautionary note, might be worthwhile
adding so that people do not go on fishing expeditions
for stuff that is not relevant to the job at hand. And I think that this is something that should be considered.
So, Madam President, as I said in my earlier
comments, I support this establishment of a wage
commission. I believe that there are people working
on this Island who are paid far below subsistence le vels. And again, it may be by choice, and that they are
prepared to be paid that and are quite happy with it.
And probably just as important are those who feel they do not have any other choice. They need to have
a job, so they take whatever wage is on offer. And
they are being paid at well below a reasonable subsistence level.
I want to finish with my own personal comments, as I said earlier, but also comments from another place . . . well, not another place, [but] another
island, I should say. As I have stated earlier, I think it is very important that the mini mum wage that is set is
carefully thought through. And so, I want to really co nclude my comments by supporting that thought by
again quoting from the Caymans Islands Minimum
Wage Advisory Committee report, and I am sure I am
going to be chastised for all of these quotes from them. But I think it is very relevant, and it sums up my
complete thoughts on this.
And, if I may quote from them, on page 77 of
their report?
The President: You absolutely may.
Sen. James S. Jardine: They say as follows: “The
aim sh ould therefore be to establish a framework for a
minimum wage that strikes a balance” (or as I would say, Madam President, the right balance) “and which
is beneficial to the labour market supply while remai ning affordable to employers and not seen as hampering businesses and the economy.” Thank you, Madam
President.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
Senator Richardson, you have the floor.
Sen. Anthony Richardson: Good morning, Madam
President .
The President: Good morning.
Sen. Anthony Richardson: Hello, Senators and
those in the listening audience.
As is typical in these debates and convers ations, we do necessarily think through the financial
and economic aspects. What I want to do, Madam
President, is preface my comments with two short,
real conversations that I have had in the recent past in
preparation for today. One was, I was talking to a
guest worker, a professional person. And he was g oing through talking about his experiences. He has
been in Bermuda for about less than two years now.
And I was asking, as we normally do, you know,
How’s it going? and what have you. And he said that
one day he had an experience whereby he worked in
an office and someone had been dismissed. And the
person came to him in a different situation and said,
you know, It’s because of people like you that Bermudians don’t have jobs.
And he talked to him in terms of, first of all,
the person who made the accusation did not know what this person’s job was. And then, after the conversation, he talked about the idea that he was a qual-ified accountant and the person who was dismissed
was, effectively, a handy -person, but who often turns
up late and all the rest of it. So, there was, in his mind, justification for that person to have been dismissed.
But then he went on to talk about the idea that some of the things that he has seen . . . Oh, his perspective
of Bermuda was that Bermuda is a land of opportunity.
And then he talked about from his homeland,
or from where h e lives, that they have a different perspective in terms of, you do not necessarily have, for
example, three meals a day. And you do not live in a
place that is reasonably comfortable and those things. And so, we talked about what is effectively a mind- set.
And so, I will come back to that in a few minutes.
Another conversation I had was with another
friend, who is visiting from the US, but lived in one of
the islands before he went to the US. And we actually
did a bit of a drive around Bermuda, and then w e got
on a boat tour. And, you know, naturally, as you are
driving or on a boat, you give comments about what
you see. And he was quite taken aback by what he
saw as Bermuda’s extreme wealth. And we did go
around, you know, the harbour and up to Morgan’s
Point and all the rest of that.
And then, further on, we talked about the idea
that, yes, this may be what you see. But the reality is
Bermuda Senate that, in the Bermudian context, it is superficial. B ecause there are many, many, many, many, many,
many people who could not possibly afford to live in
some of these accommodations, and who do get paid
quite a minimal salary in that respect.
And so, for me, this . . . yes, I understand, of
course, that there are the financial impacts. But there
is a human element to what w e are talking about t oday. And I think that has to be brought to the fore also
as part of this discussion. Because notwithstanding
what we may sometimes see on the surface, the real ity is that the cost of the fuel and food and vehicles,
electricity, bank f ees and all the rest of it —they are the
same for all of us irrespective of how much money we
may earn.
And even as recently as this weekend, I was
doing some online banking. And I said to myself,
There was a furore in the recent past when both
banks incre ased their banking fees . But now it has
died down. But the reality is that you still have to pay
those fees. So, it is a $10.00- per-month per account
fee and a $0.50- per-[transaction] fee for online transfers. And I know from my previous job that those things will add lots to the bank’s bottom line. But we
will not necessarily remain focused on those things
beyond the initial complaints when it took place. And
so, I will leave that there.
My other comment, to bring into focus, is that
again what we are used to is a capitalist society. And the reality is that capitalism is based on exploitation.
So, as a business owner, what I am going to try to do
is set my prices as high as I can. And to the extent
that I employ you, or anybody else for that matter, I am going to pay you as little as possible to ensure that
my profits are maximised. And that is one of those
realities for us in Bermuda. And my comments may be
a bit stark, I suppose. But we have come to accept
that. And even as we go about our daily lives, we do
not necessarily object to the idea of one person b ecoming very wealthy while other persons are just able
to manage.
And I am saying all of that to say that part of
this work and part of what we have to adjust to is the
whole mind- set now in terms of r eally, for all persons
who are involved in business and also the workers, how much is enough? To what degree are we pr epared to continue to allow [for] the excesses of wealth
in the context of persons who are not able to really
manage?
There were comments earlier in terms of,
what will the reference point be for setting, initially, the
minimum wage and, ultimately, the living wage? And should there be an impact in terms of, do I as the employee have one child or two children or whatever the
case may be? And am I married or otherwise? And
the reality is that while each job may not be evaluated based upon my circumstances, we have to factor that
into what we do. Because the community, the broader-based community, right, is starting in a big way to see the impact of persons not being able to manage
their daily financial obligations.
And so, we have to really, in my mind, press
Pause and think about that. And, yes, there are going
to be some financial implications in terms of whatever
the rates are set at. But at some level, the question is,
Is a job worth existing even if the person is only going
to be paid, say, $5.00 an hour? Because we have also
had situations in Bermuda whereby —and I think Senator Jardine referred to this —some persons earn such
little wages that they cannot afford to live, except
there are multiple persons living in an accommodation. And I think we have heard, we may know ourselves personally, but we have certainly heard anecdotally whereby you may have a one- bedroom apar tment, for example, with up to six occupants. Because
that is what they have to do in order to afford the Bermuda rents.
And in many cases, I think when we hear
about it anecdotally, it refers to some of the nonBermudian workers who are here being paid very low
wages, but t here are also many Bermudians who
have these same circumstances in that you may have
more than one family living in very, very small accommodations. And from that, we see multiple dy sfunctional social implications or impacts.
And so, to go back to the per son I mentioned
initially whom I talked to about what we are used to, it
is for us to now start to contemplate a difference in
that, yes, there are going to be, there may be, and I
guess there are going to be some job losses. But
some of those job losses m ay even be done as an
excuse. And as a business owner, part of the conversation and consideration is, okay, if you are making
“X” amount of money, what amount of that should r eally be shared with the workers? Because at some
level . . . Listen, if you are making “X” amount, why
can’t more be shared?
And again, that is what I am talking about,
about these shifts in mind- set that we have to go
through. And it is not easy, because from a business
perspective, it is . . . you know, I have taken the risk; it
is my idea. My money is on the line. I have to pay
bank loans and all the rest of it. But I think that is going to be a challenge for us as Bermudians , our society in terms of like going forward. Really, what is going
to be our emphasis in ensuring that Berm uda as a
society is able to continue as we go forward?
And having said that, I do recognise there are
several marginal businesses in Bermuda. And what I mean by that is that there are some that are not mak-ing any profit in the full context of what a profi t is. And
in some cases, it is evidenced by persons saying that,
My employer is stealing from me as an employee. And
that arises because I might pay you, let us say,
$1,000 a week in this instance. And I make deductions for health insurance and pensions and all the rest of it. And I do not, then, pay those across to
where they are supposed to go. And that is where the
628 29 July 2019 Official Hansard Report
Bermuda Senate accusation arises. But in some cases, I have a very
marginal business, and I do not have the amount of
money, in any event, to pay all those deductions. And
that is why I do what I do.
I am not justifying that; but I am saying that
there are going to be some circumstances by which
those businesses may falter, but I justify that by sa ying this, is it appropriate for that business to be in existence if it cannot really fulfil its own obligations? And
again, it is for us to start thinking this through, that these are going to be some of the realities of doing what is being proposed by the Wage Commission. But
there has to be a fallout. It is what it is in that sense.
And when it comes to my example in terms of
profitability, helping to determine what the impact
should be on workers, if we go back to probably the
late 1980s or early 1990s, there was huge discussion, from the negotiation point of vi ew, between the unions
and the Hotel Association, effectively. And the push
back and forth was around, w ell, what is the profitabi lity of the hotels in order to justify what the unions were
demanding or requesting? And ultimately, what they
did was they individually sent the information to Price
Waterhouse. Price Waterhouse was then able to a ggregate the data on a confidential basis and then give
it back, because the people knew, generally speaking,
what the hotel industry was doing. And that then gave a more realistic basis for the negotiations to continue.
And obviously . . . not obviously, but then, ultimately,
get to a successful outcome.
And so, those are some of the things that we
are going to have to do that may be radical to really
understand if the minimum wage is really the reason why someone becomes unemployed. Or is it the bus iness interest being ultimately selfish in its decisions?
So, rather than me have a lesser profit, I will dismiss
you. And I am saying, in my mind, that is sometimes
an exc use. We have to start figuring out what is reali stic if we are serious about living in Bermuda, going forward. It is a serious conversation to be had.
And so, Madam President, I am one of those
who certainly look forward to the work of the Commi ssion, all of the analysis and the reference points that
they will use. And from a business perspective, yes, I
am prepared to consider what will have to happen in
terms of ultimately sharing more of the business i ncome with the workers.
As a final comment, going back to the person
whom we were going on the cruise with, he works in the medical profession as a partner in an entity. And
he suggested to his fellow partners that the profit of
the business should be shared on a bonus basis with the physicians, the nurses and the rest of the persons
who work in the medical facility. And he was cha llenged by, effectively, What is wrong with you? Why would you want to do that? And I am saying that this
is the reality, that if there are profits being made, there
may have to be a different basis upon which we really
consider sharing those profits. And my final comment, Madam President (I
think it was referenced by Senator Jardine) –is that I
want to say back in the day when it came to tips, you
may be aware or Senators may be aware that a lot of
Bermudians worked in the hotel industry as part of
going between, say, age 16 and probably 20 (or 22 or
25, for that matter), during university. And at that
stage, what used to happen is, number one, I would
work in the dining room and I would receive my tips in
cash. There were no guaranteed gratuities or whate ver the case may be. And then, there were also the tips
that went in a pool. And at the end of the month or the
week, the maître d would say, Okay, fine. This has
been the pool of the grats. And then they would split
[the money] based upon a skill, between the waiters,
the bus boys and all the rest of those.
And so, there was much more of a direct attribution of those gratuities with the extra workers, whereas now, in some cases, the gratuities are mandatory. They are on your bill. And so, I as the worker do not even see that. And in some cases, we may be
aware that the employers are using what is the gratu ities as part of their own income. And so, there is a
degree of unfairness w hen it comes to this taking
place.
And so, Madam President, those are my
comments. And we are just trying to emphasise the
fact that there is a significant human element in what is being discussed. And again, I look forward to the
outcomes from the Wage C ommission to see how
they are going to have a positive impact on the social
fabric of Bermuda. Thank you, Madam President.
The President: Thank you, Senator Richardson.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR S
The President: And before I determine whether any
other Senator wants to speak, I would just like to
acknowledge the presence of the Permanent Secr etary, Ms. Aideen Ratteray -Pryse, in the Gallery, as
well as Mr. Francis Richardson from the Shipping and
Maritime Authority.
Welcome to you both.
[Employment (Wage Commission) Act 2019, second
reading debate, continuing]
The President: Would any other Senator care to
speak on this Bill?
Senator Jones, you have the floor.
Sen. Marcus Jones: Thank you, Madam President,
and a hearty good morning to my colleagues here in
the Chambers and to the greater listening audience.
I am going to springboard off of what my co lleague, Senator Richardson, was making very clear.
Bermuda Senate And my words, the fact that we are in a capitalist soc iety, so profit is the driving force for businesses. We
know that socialism is a different animal, where most
of the decision- making for an economy, for goods and
services being produced by our population, is determined by the government. So, there are different
things driving it.
So, we know that in a country like Bermuda,
where we know we are battling with the high cost of living, the number -one ticket item in any business is
the cost of its labour.
And just to make a comment in regard to gr atuities, having worked in the hotel busi ness and reali sing that gratuities have always been, shall I say, a
contentious issue amongst employers and employees, and we do know that earlier in the early years when
Bermuda went through the transition of voluntary gr atuities to mandatory gratuities, there was a time when
employers did their best (I am talking about in the hotel industry; I am not too sure about the restaurants)
. . . but I know in the hotel industry, there was a certain level of gratuities that were being held by the employers to augm ent some of their revenues to be able
to handle and underwrite the cost of labour.
But since which, we have had a number of
agreements between the Hotel Association and the
unions. I would say quite confidently that over the last 30 years, that has not been the practice. In fact, all
gratuities that are received by the hotels are actually
paid out to the workers. So, there is none of the keeping of gratuities by the hotel employers, because most
unions would tell you that they ensure that their repr esentatives are actually given a calculation sheet of
how much was generated in gratuities and how much
was actually paid out to the workers.
But having said that, because the employees’
salaries and pay is such a large ticket item on any
operation, any busines s operation, it is very sensitive.
One of the thoughts I had was, in the hotel industry, we know that once the hotel, Madam President, hits
70 per cent occupancy, the employer is allowed to do
lay-offs. And that is the hotel’s way of responding to
the drop- off in business. They lay off workers so they
can reduce their costs. I can possibly see hotels and
the like in the future saying, We want to increase that
occupancy level, because we have got to pay more in
minimum wages. We want to be able to have some
flexibility, and we may suggest that, hey, maybe that
occupancy percentage should go up to 75 per cent to
allow for the wiggle room to be able to make up for the
increase in the minimum wages.
Now, we are in favour, definitely, of this Wage
Commission. We realise that the number -one purpose
of putting together a minimum wage is to minimise the
exploitation of workers in this country. We probably,
all around this room, have been able to see examples of that happening within our community. We know for
a fact that, in more ways than not, our foreign workers are probably the number -one targets in unfair rem uneration for their work.
I will say this, though. With the implementation
of a minimum wage, I would like to think optimistically
that there will be more of a level playing field, where the foreign worker will not be as exploited as much,
because the statutory minimum wage limit will be in
place. So, we should not see as [often] the foreign
worker being chosen over the local worker because
the playing field has been levelled.
We also recognise that the minimum wage
should be sufficient enough to allow for a worker on the lower scale to be able to enjoy a reasonable
standard of living, where they will be able to afford the
basic necessities in life —food, shel ter and things like
that. But what is going to be a challenge for this par-ticular Commission is to find the sweet spot, strike the right balance between protecting the worker and at
the same time creating a flexibility for companies to be
able to be compet itive. That is going to be very, very
challenging.
And in my looking at the legislation, I took
note of [clause] 6(3). And, if I am allowed to read that,
Madam President?
The President: You certainly may.
Sen. Marcus Jones: “The Commission shall, as it
may be deemed necessary in the course of perfor ming its functions under this Act, consult with —(a) e mployers; (b) employees; (c) organisations . . .” (that
represent both employers and employees) “(e) Government Departments; and (f) any other person or
body of persons.”
When I read that, I was struck with the word
“consult” with that list of persons. And I felt very
strongly that [sitting] on that Commission should be
actual practitioners within the workforce, who are actually dealing with the challenges of making oper ations and businesses work —i.e., actually having on
that Commission union representatives, actually having on that Commission business owners who generally, the majority of their employees are on the lower
scale of workers —i.e., hotel management, restaurant
owners. Those are the employers who generally have
workers who will be living off of the minimum wage.
Because as practitioners, they will be able to take
what is theoretically decided by the Commission and
actually be able to apply it to da y-to-day operations , I
think that is very important.
The question of gratuities . . . and one may
consider a sliding scale. We know that during the off
season between November and March, the gratuity
pool is going to be very small compared to the on
season. So, one consideration may be made, does
the minimum wage for that industry have to slide
based on the season that they are operating in? I will challenge you to even venture to request that the
workers take less gratuities in replacement of a higher
630 29 July 2019 Official Hansard Report
Bermuda Senate minimum wage. I would not think that they would be
up for that. But that is going to be a challenge. And I
think there are ways of making it fair for everybody.
So, in closing, Madam President, we definitely
are in favour of this particular legislation. I be lieve it is
important. I am concerned that, with the minimum
wage that does not hit the right balance, we may have
the threat of employers reducing hours or not —or
even hiring on a part -time basis workers as opposed
to full -time workers to control that and to minimise the
impact of this particular statutory minimum wage rate.
So, I think that needs to be looked at, and we need to
be sensitive to that.
But I believe this legislation strikes the right
chord, is going in the right direction. And, Madam
Presid ent, I thank you for the time.
The President: Thank you, Senator Jones.
Would any other Senator care to speak?
Senator Michelle Simmons, you have the
floor.
Sen Michelle Simmons: Thank you, Madam Pres ident.
I am going to be brief because so much has
already been said about the need for establishing a
wage commission. I totally support this Bill. And I
think, as has already been stated by Senator Hayward
when he presented the brief, it is clear that Bermuda
is already far behind in terms of global polic y with r egard to a minimum wage and, indeed, even in terms
of establishing a living wage.
I am sure that all of us around this table recognise that there is exploitation happening in Berm uda, exploitation of workers who are being paid very
low wages. I am concerned that all employees who
are gainfully employed in Bermuda should be treated
fairly. And therefore, in terms of one’s national origin,
in terms of whether you are a Bermudian worker or a
worker from another country, I think that workers
should be paid equally in terms of workers who have
similar roles in their employment contract.
I would like to just take us to the Bill on page
7, where we have, in Part 4, the Determination of Li ving Wage Rate. When I read the definitions, or the
meaning, of “liv ing wage rate,” and if I may share this,
Madam President, I will just read it very quickly.
The President: Yes, you certainly may, Senator
Simmons.
Sen Michelle Simmons: It says, in clause 12(1), “For
the purposes of this Act, ‘living wage rate’ means th e
amount of income necessary to afford an employee
and his household a socially acceptable standard of
living calculated to take into account such factors as . . .” and there is a list. I will come back to that list in a
minute. My concern in this meaning, or definition, is
“his household,” because that could mean any size household. And if people are using this as their basis
for establishing a living wage, surely we need to more
closely define “his household.” Should it be a refer-ence sized household? Should it be a household of
two, three, four, up to ten people? I am just concerned
that this needs to be tightened up a bit.
Also, with regard to the factors given in that
same clause, it does say . . . Madam President, may I
read it again?
The President: You certainly may.
Sen Michelle Simmons: It says, “a socially accept able standard of living calculated to take into account
such factors as the basic cost of –(a) food; (b) housing;
(c) clothing; (d) medical care: (e) child care; (f) transportation.” Ther e is something that could be included
in the list, because I know that it says “such factors as,” but I think it deserves its own line item in that list,
because I know when I look at my monthly expenses, it is probably the largest bill that I pay. And that is util ity costs, which we all know are extremely high in this
country.
So, included in that living wage calculation, I
would like to know definitely that the commission will
be looking at what this household is paying in terms of utility costs.
So, Ma dam President, I said I would be brief. I
support all of the concerns already expressed about how we need to be treating employees in this country in terms of treating them fairly. And I would just ask
that the two concerns that I have raised be consi dered.
Thank you, Madam President.
The President: Thank you, Senator Michelle Si mmons.
Would any other Senator care to speak on
this Bill?
Senator Robinson, you have the floor.
Sen. Dwayne Robinson: Thank you, Madam Pres ident. Good morning to all our listening audience and
my fellow colleagues.
As my colleague has stated, we do on this
side agree that everyone should be paid a wage that is considered liveable in the country they reside in. My
concern (and I will be brief as well) is that the liveable
wage may tip the scale in the favour of big business.
And by that, I mean, if you have a small business, and
we all know small businesses’ backs are against the
wall right now with operating costs, an ageing popul ation, as well as lack of consumer purchasing po wer.
Most of the bigger businesses already, most
likely —I will not say as facts —but most likely already
pay a certain wage that would be considered liveable.
So, this particular legislation will affect those who are
Bermuda Senate currently paying what would be consider ed below a
liveable wage, which are most likely small businesses.
So, I am concerned that Bermudians may be hit as
employees who may receive notices to become part -
time. And these are things that have been brought out
by Senators around the table, but as c onsumers, as
well.
Now, in the capitalist society that we live in,
the less competition that you have tends to reflect on
the level of service you receive. And I do believe that
if we start to put more pressure on businesses that are up and coming, we may end up in a monopolised
society where larger businesses have the ability to
take and absorb the hit of a liveable wage [but] smal ler businesses may disappear.
So, I wonder and hope that this is taking into
account, when the liveable wage is created, whet her
or not, if these businesses do disappear, is our economy fertile enough for new businesses to rise up and
take their place. Do we have any sort of idea whether
or not folks will continue to take on the risk of entr epreneurship if the cost of living is still high and access
to capital is so restricted? So, I do support a liveable
wage. And I do believe that in our society, it is wrong
for those to be making so much while others make so
little.
But my biggest concern is that if we do go into
this without considering that we may be eliminating
the competitiveness of smaller business, then it may
backfire on us, because the liveable wage will not be
potent if people are unemployed. So, with those
comments, Madam President, I will close.
The President: Thank you, Senator Robinson.
Would any other Senator care to speak on
this bill?
Senator Campbell, you have the floor.
Sen. Vance Campbell: Thank you, Madam President.
I believe it was hinted at that there were days
in Bermuda when you could quit your job in the mor ning and by mid- day have another job. I will even take
that further. There were days or times in Bermuda
when you could have two or three jobs simultaneously. And many people did so to make ends meet. Some
did so so that they could enjoy certain benefits in life.
But [today the] days are more difficult. So, I would not
necessarily say they are gone, but they are more diff icult—to be able to find someone holding two and
three jobs.
And even if it was possible, you have to ask
the question, Is that a good thing, especially when in
many times it was a single parent who was working two and three jobs? So, it begs the question as to,
Who is looking after the kids and whether that has led
to some of the social issues we have today? But that is for anoth er discussion.
I do not envy the task of the employment
commission. It is not going to be easy. It is going to be extremely difficult to establish a living wage in a cl imate, Madam President, when Bermuda’s high cost of living has received much attention relative to the rest
of the world. I will focus on the fact that the Progres-sive Labour Party does not want to see anyone ex-ploited in any degree—not exploited less, we do not
want to see exploitation at all when it comes to the
amount that someone is paid. I think, you know, we
respect a business above a minimum level, a livingwage level, to reward superior performance. So, if an
employee is demonstrating superior performance, you know, this is not removing the choice of the employer
to pay that employee a little more.
It does level the playing field, but maybe not
from the perspective that was mentioned earlier if it then levels the playing field, then it costs the same,
pretty much, Madam President, to hire a Bermudian versus an overseas employee at that level. So,
whereas now, if an overseas worker is prepared to
work for a wage that a Bermudian cannot make ends
meet with, well, then, it is skewed in their favour.
I mentioned before in this Chamber about the
changing economic model when we were discuss ing
the retail business. And again, small business versus
big business, I mentioned at that time the big business
that has the corner, three- floor-story building , is a d inosaur. So, the newer businesses, the pop- up stores,
have less overhead and may be abl e to absorb . . .
and they are more nimble. Even if they have to take
out a physical, static presence, they are more nimble
than the big businesses, although they may be able to
absorb this better than the big businesses, I would argue, Madam President.
The final area that I would like to focus on, we
have spoken about the impact that this would have on
businesses, absorbing this greater wage. I want to talk
about the other side of that equation, the persons r eceiving the living wage when it is actually im plemented. Madam President, I can be paid $1 million. If I
spend $1.5 million, I am going to be in financial diff iculty. So, again, we should bring some education with
this in that, as I earn more, it should go to those bills
that I may have struggled to pay. It should not be an
extra trip this year or any trip at all.
So, again we need to bring some education.
And it does not change the impact of some of the choices and the habits that we spoke of earlier. You
know, if I earn whatever that amount, the liv ing wage
ends up being, I still have to be smart when I choose
to do certain things in my life, if I choose to do them at
all. So, I still have to have smart choices. So, we need to . . . with that living wage, I would like to see an education programme. T his does not mean that you have
hit the jackpot. You still have to be smart in your choices and the things that we do in life.
So, with those comments, Madam President, I
do support this legislation. And I think it is long over-due. Thank you, Madam President.
632 29 July 2019 Official Hansard Report
Bermuda Senate The President: Thank you, Senator Campbell.
Would any other Senator care to speak? I
think most people have spoken.
So, Senator Hayward, it is over to you.
Sen. Jason Hayward: Thank you, Madam President.
And I thank you, the fellow Senators, for t heir inte rventions in this particular debate.
I had the privilege of being on both the LAC
Subcommittee responsible for the living wage report
and also on the Joint Select Committee responsible for a living wage. And in both of those committees,
what we had to identify first and foremost, before we
even discussed whether or not the country needs a
minimum/living wage is, do we have a problem? And it was acknowledged by all in both committees that we
do have a problem. And so, in the LAC Subcommittee
report , the first paragraph, we tried to identify just the
basic problem in very layman’s terms. And if you will
allow me to read that, Madam President?
The President: You certainly may, Senator Hayward.
Sen. Jason Hayward: “What is the problem? There
has been a change in Bermuda’s job market from e mployment which was primarily in tourism to emplo yment predominantly in international business and r elated industries. This has significantly altered our ec onomic and workforce landscape. Bermuda’s economic
growth and development, coupled with other economic factors, have led to a high cost of living. And while
the cost of living has increased, wages in many job
categories have remained stagnant.
“Employment statistics reveal that there are
persons in Bermuda who fal l in categories beneath
the low income threshold. The cost of rent, food and
other basic necessities has steadily risen over the
years, while wages in many sectors have not similarly
increased. Particularly during the recession, there
have been instances w here workers have taken a decrease in pay, which has diminished purchasing po wer for many households. As a consequence of the high cost of living, Bermuda has experienced high levels of low -wage poverty.
“While the impact of poverty in Bermuda may
not be as easily recognised as it may be in other juri sdictions, over the last several years there has been a
significant increase in the number of working families
seeking financial assistance and other means of s ocial support. The demographics of persons seeking support have also changed. Historically, mainly unemployed or retired persons have sought support. But now persons who hold full -time jobs or who are under -
employed also require assistance.”
And so, that was recognised that, you know
what? There is a si gnificant portion of our population
struggling. We then went on to say, if that is the notion
that we support, then what is the evidence to support
that? And when we looked at it, we looked at the last low income studies that the Department of Statistics
actually produced, and that was in 2008. And those
low income studies, the report was actually titled, Low
Income Thresholds [:] A Study of Bermuda’s Hous eholds in Need. And that was a very important title,
Low Income Thresholds [:] A Study of Bermuda’s
Households in Need. In need of what? In need of what
in particular is this referring to?
And this is [referring to the] need of some sort
of financial assistance, some sort of subsidy, some
sort of uplift. There were three different measures in that one report . One was a relative low income
threshold. One was a low income cut -off. And one
was a low income threshold. Madam President, if you will allow me, I can just summarise the data that were
captured in that report.
The President: You certainly may, Senator Hayward.
Sen. Jason Hayward: As it pertains to a relative low
income threshold, in 2007 there were 3,680 hous eholds with incomes below the relative low income
threshold. And that was $41,000. The relative low i ncome threshold for single adult households w as
$38,000, and there were 1,115 households that fell below the relative low income threshold.
As it pertains to a low income cut -off, in [2007]
there were 3,050 households with income below the low-income cut -off of $36,605. The low -income cut -off
for a single -adult household was $33,630, which
trans lates into $646.73 per week. Twelve per cent of
single adult households fall beneath the low income cut-off.
And as it pertains to low income thresholds,
the low income thresholds study revealed that in
2007, there were 3,010 households . . . 3,100 hous eholds in Bermuda currently living below established low income thresholds, which ranged from $27,000
per year for a single adult household to $76,000 a year for a family of two parents and two children
younger than 16 years old.
And so, when we look at those numbers, we
see that there are persons who, under any other cat egorisation, would be living in some sort of poverty.
Remember, poverty is relative to the jurisdiction you are in. And so, no, we do not see those extreme levels
of poverty. But based on a statistical measure, we do
have households that are living in poverty. When we
say “households,” it is important that we recognise
that when we are talking about households, we are
not only talking about one adult at a time. Most times,
that adult can have children, which means that we
now have children who were born into conditions that
they have no control over.
This translates into the Government needing
to put some form of policy in place. There are only a
number of things that can be done. You can provide
your social protections, safety net s, and that is what
we do through Financial Assistance. We can explore
Bermuda Senate the cost of living, but that is a very difficult measure.
Or, we can say that, in certain circums tances, the
wages which individuals receive are not acceptable,
based on the cost of living in society.
We then used another set of evidence, which
was the 2015 employment survey [Labour Force Sur-vey], and we looked at the number of jobs with annual
incom es less than $35,991. And that is roughly
around $17 per hour on a 40- hour workweek. The m ajority of jobs that fell underneath that measure were,
number one, cooks, cashiers, waiters and waitresses, and sales clerks within the retail stores. And then,
there were a number of other job categories. But in
each of those job categories there were roughly
around 500 jobs that fell beneath that particular threshold.
That is important, because we can now clearly
identify which industries will be impacted most. There
is this notion that if you increase the minimum wage
rate, then it would have an adverse effect on emplo yment. But I believe you have to look at the territory
that you are in and the requirements for that job.
The reports . . . none of the reports thus far
are actually conclusive. There are studies in favour,
and there are studies that are not in favour. But what
there is no debate on is whether or not persons
should be making low, unacceptable wages. See, when we focus on the pure economic argument, we
fail to realise that there are a portion of workers in our community who are protected from low wage rates,
and those are unionised workers. There are over
9,000 unionised workers in Bermuda. And I would
venture to say that all of those workers receive in their
compensation package what we would consider to be
above a living wage or a minimum wage rate. And
each year, we negotiate higher increases for those
workers.
But what I have not found is where there is a
trade- off between that higher wage rate that we neg otiate and employers reducing their workforce. I do not
find that correlation to exist. And so, if it is, if it will
happen, it may be a minimal impact, may have a mi nimal impact on the overall economy. And that is why it
is also important that we j ust approve a National
Workforce Development Plan and we ensure that we have options for persons who may be disadvantaged. Retrain them so that they can work in jobs and receive
a proper wage so they would have to rely on a minimum wage or a statutorily set living wage rate.
A wage commission is actually the most reasonable way forward. What we wanted to avoid from a
committee level is the ability for politicians to arbitrarily put in place minimum and living wage rates. There is
somewhat of a science behi nd it. Whatever methodology that a jurisdiction chooses will be the methodol ogy that you will use perpetually, going forward. So, the
only things that change are the inputs in the methodology, and not the methodology itself. Certainly, you
can have revisio ns to your methodology. But if you have a consistent way of calculating minimum and
living wages, it reduces the amount of opposition you
will get to the actual numbers. And it is a more objective way of doing things, rather than a subjective way.
But the ILO, in its minimum wage policy guide,
actually supports that any statutory system use a tr ipartite model, a commission model in which you have
representatives of the employers, representatives of
the employees and representatives of the gover nment. They will come together. They will look at all the
data. They will have those conversations in terms of the pros and cons of the options that they may put
forward. And then, they will come to a position where
they will recommend a rate to the Minister in a report.
That is the most sensible way of doing things.
And so, I am glad that the Government has not moved
directly forward in putting a minimum or living wage rate in front of us and that they put a mechanism in
place, so what we can do is develop what are t he best
and most appropriate rates for our community, based on the conditions that currently exist in our economy
for this specific period of time.
What my colleagues, some colleagues, stated
earlier in terms of exploitation and the way in which
employees are abused, is a reality. I would have spoken about the way in which non- Bermudian workers in
particular are treated. And they, many come to Bermuda under one auspice, [only] to find out that the conditions that they accept once they get to Bermuda
are very much different than what they thought. And
often, persons will have to work for very low wages,
long hours, with no overtime [pay], no real vacation, no sick leave, even though these are provisions within
our Employment Act. And persons do not speak up
because they fear that if they do, their employment
contract will be severed.
This is the reality. And so, if we can put matters in place which level the playing field and create a
standard across the board, at least for the wage por-tion of the concerns, I think we will be doing everyone
in Bermuda a bit of justice. And I wish that everybody
should be in a dignified work environment. Decent
work should be afforded to all. Nobody should be
working in precarious working conditions.
I believe that the Wage C ommission will come
to a reasonable level. When the Joint Select Commi ttee was mulling over what would be a minimum wage,
we got to somewhere around $12.25 as being reasonable. We already had somewhat of a benchmark
regarding a minimum wage for domestic workers, the
only group of workers who do have a prescribed mi nimum wage, and that is currently at $10.00 an hour.
And so, I do not think what we will find is the
commission setting an unreasonable wage that cr eates an undue burden on business. But while we remain concerned about business interests, our priority of concern should be the workers, the people who work nine- to-five, day after day, and cannot make
ends meet.
634 29 July 2019 Official Hansard Report
Bermuda Senate There is a category of workers on financial
assistance, and those are called low -wage e arners.
And they qualify as being in the low -wage earners
category after the department takes into consideration
what they make, based on their full -time jobs and
what the reasonable expenses are. The list in the
document for a living wage is not exhaustiv e. Different
families will have different factors in terms of what
comprises what is required for their living wage calc ulation. But what we need to do is have a suite of things done to ease the burden of living for persons in Bermuda. Taxation, progressiv e taxation is one. More
intervention into the markets regarding the cost of li ving commission is another. Working to ensure that we have some sort of health care system that is afforda-ble and accessible, increased intervention regarding
the rate of rents i n this country . . . and so, there are a
number of things that we have to do so that persons working have decent lives in Bermuda.
But this is an absolutely necessary first step. It
is the best practiced step in terms of moving forward.
And this will . . . the results of the commission will u ndoubtedly have a positive effect on the lives of many workers in this country. And so, with that, Madam
President, I will conclude.
And I would like to move that the Employment
(Wage Commission) Act 2019 be now read a second
time.
The President: Is there any objection to that motion?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I would like
to suspend Standing Order 26 in relation to this Bill.
The President: Is there any ob jection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. Jason Hayward: Madam President, I now move
that the Employment (Wage Commission) Act 2019
be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
BILL
THIRD READING
EMPLOYMENT (WAGE COMMISSION) ACT 2019
Sen. Vance Campbell: With there being none, Ma dam President, I move that this Bill do now pass. The President: It has been moved that the Bill ent itled the Employment (Wage Commission) Act 2019 do
now pass.
Is there any objection to that motion?
No objection. The Bill is passed.
[Motion carried: The Employment (Wage Commission)
Act 2019 was given a third reading and passed.]
The President: Thank you, Senator Hayward.
And, Senators, it is 12:30. We will break for
lunch. And we will resume at 2:15.
Thank you all.
Proceedings suspended at 12:3 3 pm
Proceedings resumed at 2:17 pm
[Sen. the Hon. Joan E. Dillas -Wright, President, pr esiding]
The President: Good afternoon, Senators. I hope you
enjoyed your lunch. And for the listening public, we are continuing with the Senate, the Orders of the Day.
And the next Order of the Day is the second
reading of the Dental Practitioners Amendment (No. 2) Act 2019.
And, Senator Hayward, this is your Bill. You
have the floor.
Sen. Jason Hayward: Madam President, I move that
the Bill entitled the Dental Practitioners Amendment
(No. 2) Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Hayward.
BILL
SECOND READING
DENTAL PRACTITIONERS
AMENDMENT (NO. 2) ACT 2019
Sen. Jason Hayward: Madam President, today I pr esent the Bill entitled the
Dental Practitioners Amendment (No. 2) Act 2019 .
Madam President , the Minist ry of Health is
responsible for the legislation that provides the
framework for the regulation of health care professionals. The Dental Practitioners Act of 1950 [the Act]
is the legislation that establishes the Bermuda Dental Board [the Board] and the Dental Professions Complaints Committee, and guides the regulations of dentists, dental hygienists and dental technicians.
The Board is the regulatory Authority charged
with ensuring high standards of professional competence and conduct for the dental profession and to
Bermuda Senate advise the Ministry on iss ues pertaining to them. A ccordingly, the Board’s and the Ministry’s efforts to advance standards for professional practise are ongoing.
The committee is responsible for receiving and investigating complaints against any dentist, dental hygien-ist or dental technician registered with the Board in
order to determine whether a complaint should be r eferred to the Board for possible disciplinary action.
Madam President , the Bill entitled the Dental
Practitioners Amendment (No. 2) Act 2019 proposes
to improve the administrative handling of complaints made against dentists, dental hygienists and dental
technicians by increasing the number of alternate
members available for both the Board and the committee.
Additionally, the Bill proposes a provision for
an auxil iary committee to be constituted when the
committee is unable to deal with all of the complaints
before it. It is important to note that the reasons for
constituting an auxiliary committee can be due to the
volume of complaints received, time constraints and conflicts of interest. The proposed amendments for
auxiliary committees make provisions for decisions of
such committees to be decisions of the committee.
Madam President , currently the Act allows for
seven members of the Board, with one alternate eac h.
It also provides for the committee to be comprised of three members and three alternates. This number of
alternates has proved unworkable due to the intensity
of work involved in investigating complaints and conducting disciplinary hearings.
Madam President , both the Board and the
committee comprise members with full -time commi tments within their respective professions, and secur-ing their engagement for complaints is unreasonably
onerous and unworkable. On average, the committee
receives about three complaints per year. Each complaint is investigated in order to determine whether an
allegation sets out grounds for disciplinary action. The
investigation of a complaint can be a lengthy process
and require intensive consultation, coordination and
research. It is also important to note that during an
investigation, committee members are coordinating
and balancing their professional and personal sche dules in order to ensure a thorough investigation.
Madam President , in our small community,
persons are often conflicted, and establishing a committee that can meet the particulars of a complaint is
challenging with the current membership structure.
The changes proposed today are small, but necessary
to improve the timeliness and efficiency of complaint
handling for both the person making the complaint as
well as the registered person who is the subject of the
complaint.
Overall, Madam President , the Bill entitled the
Dental Practitioners Amendment (No. 2) Act 2019 will
improve complaint handling so that the Boar d and the
committee can continue to uphold the high standards of professional competence and conduct essential
services and safeguarding of the public health.
Thank you, Madam President.
The President: Thank you, Senator Hayward.
Would any other Senator care to speak on the
Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident.
This Bill effectively looks to mimic what was
done with the Medical Practitioners Act, and we do not
have any further comments beyond those r aised at
that time.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Hayward, over to you.
Sen. Jason Hayward: Madam President, I now move
that the Dental Practitioners Amendment (No. 2) Act
2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I move to
suspend Standing Order 26 in relation to this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
Sen. Jason Hayward: Madam President, I now move
that the Dental Practitioners Amendment (No. 2) Act
2019 be now read a third time.
The P resident: Is there any objection to that motion?
No objection.
BILL
THIRD READING
DENTAL PRACTITIONERS
AMENDMENT (NO. 2) ACT 2019
Sen. Jason Hayward: Madam President, there being
no objection, I move that the Bill do now pass.
The President: It has been moved that the Bill ent itled the Dental Practitioners Amendment (No. 2) Act
2019 do now pass.
636 29 July 2019 Official Hansard Report
Bermuda Senate Is there any objection to that motion?
No objection.
The Bill is passed.
[Motion carried: The Dental Practitioners Amendment
(No. 2) Act 2019 was given a third reading and passed.]
The President: Thank you, Senator Hayward.
[Order] (5) [under] the Orders of the Day is the
consideration of the draft Regulations entitled the
Merchant Shipping (Fees) Amendment Regulations
2019.
And Senator Caesar, I believe this is your Bill.
Sen. Crystal Caesar: Yes.
The President: You have the floor.
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I move that the Senate do
now take under consideration the draft Regulations
entitled the Merchant Shippi ng (Fees) Amendment
Regulations 2019.
The President: Is there any objection to that motion?
No objection, Senator Caesar.
REGULATIONS
MERCHANT SHIPPING (FEES)
AMENDMENT REGULATIONS 2019
Sen. Crystal Caesar:
Madam President, the purpose
of the amendment regulations before the Senate t oday is to implement a new scale of charges for the
registration of ships with the Bermuda Ship Registry,
to introduce regis tration incentive programmes and to
provide the appropriate powers for the Bermuda Shi pping and Maritime Authority (or BSMA) to reduce or waive fees under certain specific circumstances.
Madam President, Bermuda is a member of
Red Ensign Group (or REG), c ategory 1 shipping registries, and is privileged to register ships of any type,
age or size. The registry must ensure ships on its register comply with Bermuda’s international obligations.
In order to maintain the required standards, the BSMA
must undertak e regular technical surveys, audits and
safety inspections of registered ships, and issue stat utory certificates. Shipowners are required to pay a registration fee, annual tonnage and service fees, and additional fees are levied for certain technical services.
Madam President, the ship registration is a
lucrative and competitive international business. And
shipowners have many options available when considering a jurisdiction to register their ships. Therefore, competing international ship registries have introduced various incentive programmes as a method of encouraging shipowners to register their ships with
the respective registry’s jurisdiction. To enhance Bermuda’s commercial competitiveness and to support
marketing efforts to grow the ship registry, the BSMA
is proposing to implement a new scale of fees for the
one-off initial registration of vessels joining the registry
and introduce an incentive programme. The details of
the proposed programmes are as follows:
• New scale of fees for initial registrat ion of new
vessels, a one- off fee, which is a discount of
30 per cent off the initial registration fee will
be available in the following circumstances:
1. registration of a vessel that is five years of
age or less from the date of first construction or that has undergone a major conversion within the past five years;
2. registration of three or more vessels at
the same time that are 15 years of age or
less, or at least an irrevocable written
commitment to register three or more such vessels within a calendar year;
3. This discount will be increased to 50 per
cent for an owner registering 10 or more vessels that are 15 years of age or less at
the time [of] submitting an irrevocable
written commitment to register 10 or more
such vessels within a calendar year.
Maritim e incentive programme. C urrently,
there are a number of shipping companies that are
registered Bermuda companies, but their ships are
registered in other jurisdictions. It is proposed to pr ovide a reduction in the initial registration fees for ow ners who h ave their shipping company based in Bermuda and who register their ships with the Bermuda
Ship Registry. A similar reduction in the initial registr ation fees can be provided for shipping companies that
comply with the economic substance requirements
once t he scope of adequate requirements is finalised.
Madam President, it has become custom and
standard practice for open shipping registries to waive or reduce fees and the cost of services for specific shipowners and clients as a form of incentive to attract new business, particularly with ships that are under
construction. It is often the case where open ship re gistries will negotiate and enter into agreements with
shipbuilders in Korea, Japan, Italy, Germany and China to provide a ship registration financial package,
which the shipbuilder in turn markets and offers to
owners and financiers to secure construction orders.
Therefore, it is proposed to provide the BSMA the appropriate powers to waive or reduce fees for the new
construction vessels and with the registration of a fleet
of vessels and in other specific circumstances.
Madam President, other amendments to the
regulations include provisions for the issuance of spe-cific insurance certificates as a result of recent
amendments to the enabling legislation to the Merchant Shipping Act 2002, and provisions for the iss uBermuda Senate ance of ship radio licences. Thank you, Madam Pres ident.
The President: Thank you, Senator Caesar.
Would any Senator care to speak on these
[draft regulations]?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, Madam Pres ident.
I just had one question for the Senator. I do
not know if you can answer this. I mean, I know that
the Shipping Authority, one of the reasons (and you
say it in your statements) was to create or i ncrease
our shipping register. And do you have, or does the
Ministry have any idea what revenues, additional revenues they are hoping to generate as a result of this
change? Or will, in fact, revenues be reduced? I see it
as a revenue- generation exercise, and I just wo ndered if they had any sort of thoughts as to what they
thought they could bring in by way of additional rev enue.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
these [draft regulations]?
No? Then, Senat or Caesar, you have one
question.
Sen. Crystal Caesar: Yes. Thank you, Madam Pres ident. If you just bear with me, I am going to see . . .
my technical people are listening in, and see if they
can provide an answer for that.
[Laughter]
Sen. Crystal Caesar: If not, I will have to take it under
advisement and give you the answer later.
Sen. James S. Jardine: That is fine. That is fine,
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITORS
The President: And before I open it up to other Sen ators, I would just like to acknowledge the presence of the Financial Secretary, Mr. Anthony Manders, in the
Chamber, as well as Ms. Miriam Rogers, the Parli amentary Counsel.
Welcome to you all.
[Public Service Superannuation Amendment Act
2019 , second reading debate , continuing]
The President: Would any Senator care to speak on
this Bill?
Senator Kempe, you have the fl oor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident. Thank you, Senator Campbell, for introducing
the Bill.
I guess there are two sides to the argument
about the retirement age. From one side, obviously,
we have a country with a demographic projection t hat
is skewing towards an average older age. So, of
course, the strains on our pension funds are going to
be significant. And there are people who are stru ggling when they get 65 and may wish to, or need to, keep working either to stay active or to fund our longer
life expectancies and what is needed down the line.
The other half of it, of course, is young people
trying to access the workforce, finding fewer openings
being available, and of course, the burden—I know we
are talking about public service here , but —also on
employers when, especially after the 2010 downturn,
they needed to lighten their workforce. And obviously,
if there was a mandatory retirement age, that was a
way to go about it without necessarily having to go through a whole bunch of redundancy payments and
this sort of thing.
I note that Senator Campbell spoke about, I
guess, looking for holistic approaches, and also, the
promise about people being able to work for longer
without permission being needed to do so. So, I guess
that brings me to a couple of comments and a question. And I will start with the question.
In [clause ] 3(b) of the amendment [to the pr oviso] . . . so, on page 2, it amends section 22. And it
inserts that once you go 65, you will need to provide a
medical fitness repor t to say that you are physically or
mentally capable to perform the roles in the job. Ho wever, it also says that it is going to be subject to “annual confirmation by the contributor’s Head of D eBermuda Senate partment to the relevant Permanent Secretary that the
contribu tor” (and here is the key bit, that the contributor) “is competent to discharge the duties of the post.”
So, when we talk about without needing permission to
do so, this clause specifically seems to me that you do require permission to continue to work. An d that is
from, basically, your superior or your supervisor or
whatever in the respective role.
So, I guess my question is, So, what comes
down to this? If the previous iteration of the Public
Service Superannuation Act basically forced people to retire a t 65, and therefore being retirement, there is no
redundancy payout for years worked, what happens if
you want to keep working? And if your doctor says
you are capable to keeping working, but the Perm anent Secretary or the head of the department, that
relevant Permanent Secretary, says that you are not
the right person anymore, is that considered a redu ndancy? Is it considered a retirement? So, I would certainly like some answers around that and how that
plays out to pay out costs to the government in this case.
What I will also ask is, seeing as this ageing
demographic and, obviously, the pension challenges
are more with the public service as opposed to private
sector pensions, but still the ageing demographic and
how we are going to confront that as a country is something that needs to be had. In the Employment
Act, there is no mandatory retirement age. So, any
mandatory retirement that people have in the private
sector is because it has been expressly included in
their employment contract. Now, some companies do
have that; some do not, because age discrimination is not covered under the Human Rights Act.
But my question is, this model seems like it
could work in a broader sense, whereby if there was a
mandatory retirement age, that after a certain age,
both employer and employee have a mechanism that
is the same across the board, whereby someone, because someone may at a certain point just want to
work a few less hours, or do whatever, but still want to
keep working. And for an employer, it is tough to
manage this, the weight of, say, 10– 20 years of accumulated redundancy, or 13, I guess, where it maxes
out, and the need to also promote internally and do
this kind of thing when people are waiting for opport unities to open up.
So, I would like to know, woul d this similar
sort of mechanism be considered for the Employment Act? And what happens when someone wants to keep
working past 65 and is physically fit, according to a
doctor, but their supervisor says, You’re not competent to discharge the duties of the post ? Thank you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, and good mor ning, Madam President and listening audience.
The Presiden t: Good morning.
Sen. James S. Jardine: I support this legislation not
just because I am over 68.
[Laughter]
Sen. James S. Jardine: But because I think there are
many of us who are well capable of working beyond
65. And I think this allows for that. Al so, not just because the Fiscal Responsibility Panel recommended
it, but also the SAGE Commission, upon which I
served on the subcommittee dealing with pensions,
and one of the recommendations that we did make at the time was to increase the retirement age beyond,
[what it is] currently, at 65. So, I think these are all
steps heading in that direction.
There are also a whole lot of other reco mmendations contained in the SAGE Report, dealing
with pensions, which I hope Government will look at in
due course. I know they have adopted some of them.
But it is a continuing process. So, I do support this Bill.
I had one question, and it is really a point of
clarification, I guess. I listened to the Senator’s
presentation. And I was trying to find out whether, once you reach the age of 68 and you have been gi ven permission to continue to work to age 70, do you
continue to contribute to the PSSF [Public Service
Superannuation Fund]? Or does that actually cease once you reach 68, regardless of whether you conti nue to w ork or not? Let me put that another way. If I am
continuing to work to age 70, do I have to make contributions to the PSSF during that two- year period of
time? And that is the one question of clarification that I had.
Apart from that, Madam President, I do support the Bill. Thank you very much.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
Senator Hayward, you have the floor.
Sen. Jason Hayward: Good morning, Madam Pres ident.
The President: Good morning.
Sen. Jason Hayward: Madam President, I whol eheartedly welcome this Bill that is put forward by the Government. I was responsible for chairing the LAC
[Labour Advisory Committee] Subcommittee, who explored this whole topic regarding the retirement age
and age discrimination. And it was the committee in
which I chaired that provided the recommendations
that Senator Campbell read before us today.
616 29 July 2019 Official Hansard Report
Bermuda Senate The first thing the committee did was diagnose whether or not there is a problem. And we recognised that there i s a problem. Senator Kempe hig hlighted some of the challenges regarding the financial hardship that persons do have transitioning from a working individual to a pensioner. We also recognised
that there were problems with the funding of our Public Service P ension Fund, and we asked ourselves,
Would changes in that direction assist with the problem?
The other thing we had to recognise was that
Bermuda’s population is ageing. And so, the dem ographic makeup of our population is changing, and it
is rapidly chan ging to an ageing population. As a r esult, there had been no real shift in the way in which
employers were treating persons as they reached the
age of 65, even though life expectancy was longer.
We looked at the other measures, such as
persons not just t ransitioning from the workplace to
being a pensioner, but persons transitioning from the
workplace to [signing up for] Financial Assistance. So, this week they are working; next week, you can retire;
and you find that you are not making ends meet, and
you sign up for Financial Assistance.
We also looked at the fact that Government
had, the previous Government had allowed, and it continued under this Administration, for persons to retire under our early retirement incentive scheme.
We found that persons wer e taking their early retir ement incentive scheme and then knocking on the former employer’s door to try to get employment back.
What they have found is that they could not sustain
their financial obligations in society on the funds that they were receiving from the early retirement scheme.
Working beyond the age of 65 is not unco mmon in Bermuda. There are thousands of persons . . .
I think in the last census, there were 2,530 persons 65 and over working in our population. And so, that gives
us an idea of t he capability of persons to work over
65. That number actually increased from the 2010 Census.
What was highlighted in the last census also
was the unemployment rate for those persons 65 and
over. Now, naturally, you would not have an unemployment rate for those 65 and over, because they
would not be considered as part of the active wor kforce or actively seeking or looking for work. But in
this particular instance, it had tripled the number of
persons who were actively seeking work over the age
of 65. And so, it spoke about the demands in our s ociety to make some sort of change.
Changing the pension age society -wide is a
little bit more difficult. And I think beginning with the
public service is a good idea. When we looked at ot her societies, the majority of the developed European
societies, they have removed retirement age. It is all very flexible when it comes to retirement ages. And
so, when speaking with some colleagues, some colleagues currently have mortgages that will extend be-yond their age of 65, due to their need to refinance
during the [economic] downturn and things of that nature. And so, this would help individuals a lot.
But we have to look at it and say, This is not
just for health. This is about recognising that people are still capable to p erform at a high level at age 65.
Certainly, there will be some jobs which we would
have to review, based on their physical requirements,
and to determine if somebody is still capable of doing
the job. And I think that is where the assessment from
the supervisor is needed. I do not think it is one of those subjective things that will be put in place. You
will note that all public servants are protected by the
Bermuda Public Service Union. And in order for
somebody to be denied, certainly there would have to
be valid grounds. But I do not think the aim is to shift the retirement age, to then continuously deny indivi duals. That makes absolutely no sense to the aims and
objectives that we are trying to achieve.
Like Senator Kempe did state, many persons
agree to retire at age 65 through their employment
contracts. And I believe many persons are not aware
that they actually agree to retire at age 65 in their employment contracts when they begin employment. And
if I just look at myself, as a younger individual, w hen I
went to sign the employment contract, the last thing I
was probably worrying about was 30 to 35 years down
the line. And so, we do have a defined retirement age specified in the National Pension Scheme legislation.
It does have a section in there that says pension age,
and does speak to 65. And that is the age in which the
insurance companies actually abide by.
What this Bill actually does is allow persons to
work to the age of 68. We believe, through our r esearch, that 68 was a good . . . was a suff icient time
period for the first adjustment. Ultimately, we are pr oposing that persons work up to 70. But as you know,
in the public service, persons still do have rights to
work up to 70. And this is at the discretion of the Head of the Civil Service.
Madam President, when we reviewed the data, there was not a one- to-one relationship with our
younger workers. So, it is not, an older worker retires,
and then somehow it creates space in the public service for a younger worker. What we find in the public service is that, when an older worker retires, most
times, their jobs are filled by a more experienced or
older worker. It all depends on which job category
they are actually in. But based on our ageing popul ation, sometimes you replace an older Bermudian worker with a younger or older non- Bermudian wor ker. That can also be a factor. So, it was not a one- toone relationship, where there are younger workers
being prohibited from entering the public service b ecause persons are working longer.
You should also ap preciate that the public
service has a natural attrition rate, where persons
leave the public service for a number of reasons.
When persons leave the public service, for a number
Bermuda Senate of reasons, I mean, that also creates opportunities for
persons coming in and filling vacant posts.
These provisions also go a long way in creating a more sustainable Public Service Superannuation
Fund. Obviously, if persons are working longer, they are contributing more. And also, the liability for . . . the
Government is able to reduce its liability and defer the
liability for a longer period of time. And that is a pos itive step. The actuary has actually advised that this
will not be a meaningful step, and it will give the Public
Service Superannuation Fund some additional life.
I think that these changes are timely. They
make sense. I think that anybody viewing these
changes will see that they are in benefit of our society.
And I thank the Government for bringing them for-ward. Thank you, Madam President.
The President: Thank you, Senator Hayward.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, you have a
couple of questions to respond to.
Sen. Vance Campbell: Thank you, Madam President.
Madam President, it is good to have a summary by the Chai r of the subcommittee that put forth
the recommendations, and I appreciate that, coming
from Senator Hayward.
So, from there I will deal with the questions,
Madam President, that were put forward. The first being, What happens if an employee wishes to continue
to work? The doctor says they are competent to work,
but the head of their department says they are not fit to continue to work. There will be no redundancy in
that instance, Madam President. There would simply
be the retirement at the age of 68. So, they will r eceive their pension and the like.
There was also a suggestion/question from
Senator Kempe, saying that this makes sense and
could work in a broader sense, being in the private
sector, I assume. Is that correct, Senator . . . Madam
President, is that correct that he was referring to the
private sector, that this could possibly work?
The President: Senator Kempe, do you want to r espond to the question?
Sen. Nicholas Kempe: Yes. I was referring to the
broader Bermudian economy, both private and public.
The President: Thank you.
Carry on, Senator.
Sen. Vance Campbell: Well, that would actually fall
under the Ministry of Labour and Home Affairs and
would be a matter for that Ministry to consider.
Sen. Nicholas Kempe: Point of clarification?
The President: Will you accept a point of clarification,
Senator?
Sen. Vance Campbell: I will accept it.
The President: Yes. Carry on.
POINT OF CLARIFICATION
Sen. Nicholas Kempe: Yes.
I believe the Public Service Superannuation
Act would be subservient to the Employment Act, but I
am not entirely certain on that.
Do you know?
Sen. Vance Campbell: We would have to take that
under consideration, Madam President.
The President: Thank you, Senator Campbell.
Carry on.
Sen. Vance Campbell: And there was a lso one final
question, regarding once a person reaches the age of
68 (I think this was coming from Senator Jardine) and
they choose to continue and are allowed to continue
to age 70, do they still contribute to the PSSF? And
the answer to that would be yes, they do.
So, with that, Madam President, I move that
the Bill entitled the Public Service Superannuation
Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
the Standing Order 26 be suspended in respect of this
Bill.
The President: Is there any objection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Public Service Superannuation
Amendment Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Carry on.
618 29 July 2019 Official Hansard Report
Bermuda Senate BILL
THIRD READING
PUBLIC SERVICE SUPERANNUATION
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Public Service Superannuation Amendment Act 2019 do no w pass.
Is there any objection to that motion?
No objection. The Bill is passed.
[Motion carried: The Public Service Superannuation Amendment Act 2019 was given a third reading and
passed.]
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The President: The second Order of the Day is the
Fund Administration Provider Business Act 2019. And
I believe that is Senator Campbell.
The second Bill is yours as well, Senator
Campbell?
Sen. Vance Campbell: That is correct, Madam Pres ident.
The President: You have the floor when you are
ready.
[Pause]
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Fund Administration Provider
Business Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
BILL
SECOND READING
FUND ADMINISTRATION PROVIDER
BUSINESS ACT 2019
Sen. Vance Campbell: Thank you, Madam President.
Madam President, I am pleased to present the
Fund Administration Provider Business Act 2019 [the
Act] for the consideration of the Senate. The Bill seeks
to enhance Bermuda’s supervisory and regulatory regime for those engaged in fund administration pr ovider business, an important segment of Bermuda’s
financial services sector.
Madam President, by way of background, in
March 2018 a discussion paper entitled “Proposed
Enhancements to Investment Business, Investment
Funds, and Fund Administration Regimes” was issued
by the Bermuda Monetary Authority (the BMA, or A uthority). As indicated in this paper, input from industry stakeholders was sought regarding proposed modif ications to the framework in place for these sectors.
Following the feedback received from the discussion
paper, the Authority made a commitment in its 2018
business plan to support the introduction of the legi slative proposals in respect of fund administration bus iness. And this proposal involves enacting a new
standalone fund administration Act, the Fund Admi nistration Provider Business Act 2019.
Madam President, the Fund Administration
Provider Business Act 2019 is the first of a series of
enhancements to the investment business and i nvestment fund regimes proposed in the March 2018
discussion paper. Madam President, the Fund Admi nistration Provider Business Act 2019 is derived from
the original Investment Funds Act 2006 (the IFA)
which provides the legislative basis for Bermuda’s investment fund and fund adm inistration businesses.
While the IFA 2006 has been subject to amendments
over time, these amendments have tended to be ad
hoc in nature, addressing specific issues and partic ular circumstances related to investment fund vehicles. However, with the evoluti on of the fund business, it is
the Authority’s view that its oversight of fund admi nistration businesses, and investment fund products,
will each be better accomplished via separate legisl ative frameworks. Furthermore, introducing a legislative
regime that is specific to fund administrators will put
this sector on the same footing as other regulated f inancial institutions in Bermuda.
Madam President, the Authority has proposed
that a majority of the existing provisions within the
IFA, related to the fund administration business, pr edominantly found within Part III of the IFA, be incorp orated in the new Fund Administration Provider Bus iness Act 2019. When developing the new Act, the
Authority sought to ensure that relevant provisions of
the IFA were updated where appropriate in the new
framework so as to be consistent with how compar able provisions are presented within recently adopted
legislation covering other regulated financial instit utions.
Madam President, the new Fund Administr ation Provider Busines s Act 2019 seeks to provide
consistency and clarity in respect of how fund admi nistrators exercise their functions and how the Authority supervises them. Key aspects of the regime for fund
administrators, which have been subject to enhanc ement in the new B ill, include:
Bermuda Senate 1. carrying on fund administration business
in or from within Bermuda;
2. safeguarding of other assets for clients;
3. minimum criteria for licensing;
4. statement of principles;
5. reporting requirements; and
6. new code of practice.
Madam President , I will n ow elaborate on
each of these points.
Point 1: Carrying on fund administration bus iness in or from within Bermuda. This section is derived from section 41, Part III, of the IFA and is a core
element of the current fund administration business
regime. This section prohibits a person from carrying
on the business of a fund administrator in or from within Bermuda without a licence. The Authority b elieves that additional certainty is required with regard to when one would be considered to carry on or purport to carry on the business of a fund administrator in
or from Bermuda.
Accordingly, this legislation provides that fund
administrators will correctly be regarded as carrying on fund administrative business within Bermuda if
they occupy premises in Bermuda or make known, by
way of website, promotional materials, legal doc uments, or letterheads, that they may be contacted at a particular address in Bermuda, or are otherwise seen to be holding themselves out as engaging in or carr ying on fund administrator business in or from within Bermuda.
Furthermore, the Act makes it clear that a
company incorporated in Bermuda shall not carry on the business of a fund administrator anywhere in the world without being licensed by the Authority.
Point 2: Safeguarding of other assets. The
Act makes provision for Bermuda licensed fund administrators to provide, subject to a specific applic ation process, certain safeguarding services for other
assets only, and not in respect of financial instruments
or client monies.
It is intend ed that fund administrators which
provide any such safeguarding services will be subject to additional obligations, which will be contained within the regulations which can be made by the Minister of
Finance pursuant to the new Act and an updated
Code of P ractice, which the Authority will be empo wered to issue. Licensees who are granted permissions
to provide such safeguarding services in respect of
their clients’ other assets will be subject to additional
reporting and disclosure obligations including the r equirement to prepare audited financial statements submitted to the Authority on an annual basis.
Point 3: Minimum criteria for licensing. The
minimum criteria for licensing of fund administrators is
currently set out in the Schedule to the IFA. The A uthority must be satisfied that the minimum criteria are
met and continue to be met by entities seeking to be licensed or which are currently licensed as fund administrators. The new Act updates the existing mini-mum criteria for licensing to ensure that the provisions
contained therein are consistent where appropriate
with those reflected within recently adopted legislation
covering other regulated financial institutions.
For example, Madam President, the Act
strengthens the existing requirements for business to
be conducted in a prudent manner by adding a prov ision specific to maintaining adequate accounting and
other records, along with accompanying systems of
control and associated policies and procedures. Also,
further emphasis is given to corporate govern ance
obligations, by reflecting these obligations ind ependently rather than as a subset of the fit and proper
persons criteria.
Point 4: Madam President, in relation to
statement of principles, the new Act requires the A uthority, consistent with other supervisory Acts for f inancial services providers, to publish, as soon as
practicable after the legislation comes into force, a
statement of principles which identifies the manner in
which the Authority proposes to act in respect of the
following:
(a) interpreting the minimum criteria specified
in the Schedule to the Act and grounds for
revocation;
(b) exercising its power to grant, revoke or
restrict a licenc e;
(c) exercising its power to obtain information
and reports , and to require production of
documents; and
(d) exercisi ng its power s to impose a civil
penalty, censure publicly, make prohibi-tion orders and publish information about
any matter to which a decision notice r elates.
Point 5: Reporting requirements. Section 47
of the IFA requires fund administrators to submit an
annual statement of compliance to the Authority, but the information to be included in this statement is general in nature. In keeping with international best
practice in this area, the Act expands and makes
more specific the requirements of the statement of
compliance by way of the following:
(a) requiring that the statement of compliance
be signed by two directors, one of whom must be the chief executive or equivalent
officer;
(b) introducing more extensive confirmation
requirements; and
(c) providing the Authority with the power to,
upon application, grant an extension in r elation to the filing of an annual statement
of compliance.
Madam President, a lso, it is proposed that
fund administrators be subject to new requirements
with respect to the filing of annual fina ncial stat ements, including a requirement for the appointment of
an auditor and the filing of annual audited financials in
the instances where the fund administrator has been
620 29 July 2019 Official Hansard Report
Bermuda Senate approved to provide safekeeping service for the cl ients’ other assets.
Point 6: Madam President, in relation to code
of practice, the Act makes provision for such a code to
be issued. In this regard, it is proposed that the exis ting code of conduct for fund administrators be revised
to achieve alignment with, among other things, the
revisions to be made to the minimum criteria for l icensing.
Madam President , I can confirm that there are
currently 27 fund administrators licensed under the
existing IFA regime, which we would expect to be l icensed under the new regime once it comes into
force.
Madam President , I wish to emphasise the
Authority sought input from stakeholders on all of
these provisions in March 2018, by means of the
aforementioned discussion paper and via a consult ation paper and draft Bill issued in April 2019. This Bil l
represents a collaborative effort between the Authority and various industry stakeholders. Accordingly, I would like to thank all of those persons within the
Bermuda Monetary Authority, the Attorney General’s
Chambers, the Minist ry of Finance and the pri vate
sector who have assisted with the development of this
Bill.
With those remarks, Madam President , I
pause to allow other Senators to speak. Thank you, Madam President.
The President: Thank you, Senator Campbell.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: And before we do that, I would just
like to acknowledge the presence of Mr. Ifor Hughes
from the Bermuda Monetary Authority, who is in the
Chamber this morning. Thank you.
[Fund Administration Provider Business Act 2019,
second reading d ebate, continuing]
The President: Would any Senator care to speak?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident.
We understand that there was sufficient i ndustry consultation, and we have no objections to this
Bill.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No. Then, seeing that you have full support,
Senator Campbell, over to you.
Sen. Vance Campbell: Thank you, Madam President.
And thank you, Senators, for your support.
Madam President, I move that the Bill entitled
Fund Administration Provider Business Act 2019 be
now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Campbell.
SUSPENSION OF STA NDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
Standing Order 26 be suspended in respect of the Bill.
The President: Is there any objection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. V ance Campbell: Madam President, I move that
the Bill entitled Fund Administration Provider Business
Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
BILL
THIRD READING
FUND ADMINISTRATION PRO VIDER BUSINESS
ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Fund Administration Provider Business Act
2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
[Motion carried: The Fund Administration Provider
Business Act 2019 was given a third reading and
passed.]
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The Presiden t: We now move on to the third [Order]
under the Orders of the Day. And that is the second
reading of the Employment (Wage Commission) Act
2019.
Bermuda Senate Senator Hayward, this is your Bill. You have
the floor.
Sen. Jason Hayward: Madam President, I move that
the Bill entitled Employment (Wage Commission) Act
2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator, Hayward.
BILL
SECOND READING
EMPLOYMENT (WAGE COMMISSION) ACT 2019
Sen. Jason Haywar d: Madam President, I am
pleased to introduce the Bill entitled the Employment
(Wage Commission) Act 2019 , which seeks to set up
a Wage Commission in order to report on and recommend a minimum and living wage regime for Bermuda.
Madam President, as my Senate colleagues
will be aware, on the 10th of August 2018, a motion
was brought before the House of Assembly for the
consideration and approval of the Parliamentar y Joint
Select Committee’s report on the establishment of a minimum/living wage regime. Among other recommendations in the report is the establishment of a
Wage Commission.
Madam President, the report was approved,
and the November 2018 Throne Speech conf irmed
Government’s commitment to implementing a minimum/living wage regime. Madam President, the International Labour Organization, or ILO as it is commonly referred to, defines minimum wage as (and I quote)
“the minimum amount of remuneration that an employer is required to pay wage earners for the work
performed during a given period, which cannot be r educed by collective agreement or an individual con-tract.”
The purpose of a minimum wage is to protect
workers against unduly low pay. Madam President, the days of Bermudians being able to pick up and
choose jobs are gone. The current economic climate
puts the demand- and-supply equation for labour in the
employer’s favour. Unskilled workers now have to
compete for jobs, and exploitation of workers is occurring. We have all heard of people who are making
$5.00, $6.00, and $7.00 an hour, and this is occurring
in Bermuda, which has one of the highest costs of
living globally.
To illustrate, Madam President, Honourable
[Senators] may be aware of a job advert earl ier this
year in which persons were looking to hire a live- in
caregiver. The job responsibilities listed were to take
care of an elderly person suffering from dementia,
clean, cook, provide companionship, run errands, work five days a week from 9:00 am to [9:00 pm], and
be on call seven nights a week. The successful candidate would have two days off, but would have to prep
meals before leaving, and make $10.00 an hour, less
room and board. Madam President, I think we can all
agree that this embodies the ter m “exploitation.”
Madam President, this Bill seeks to provide
for the establishment of a Wage Commission, which will be mandated to enquire into the provisions of a
statutory wage scheme with the objective of making
recommendations on a minimum hourly wage and a
living wage rate, which would be prescribed by the
Minister responsible for Labour. Madam President, the
composition of the Wage Commission will consist of a
total of eight persons: a chairman, five members and
two ex officio members representing t he Ministry of
Finance and the Ministry responsible for Labour.
Members will be appointed by the Minister responsible
for Labour for a period of three years and have broad
experience and expertise in economics, law, statistics,
and other suitable qualifications.
Provisions will be made to pay the Members
of the Commission in accordance with the
Gover nment Authorities (Fees) Act 1971 . The fee is set at
$100 per meeting for the chairman and $50 per meeting for the members. A consequential amendment to
the Government Authorities (Fees) Act 1971 will be
made.
Madam President, to facilitate the proceedings of the Commission , the Bill authorises t he Mini ster to designate a public officer to be the secretary to
the Commission , thereby reducing the need for additional administrative costs.
Madam President, the Bill stipulates that the
functions of the Commission are to make recommendations on the mi nimum hourly wage and the living
wage rate. To fulfil this mandate, the Commission is
required to conduct research, enquiries and analysis,
and to consult extensively to ensure that all stak eholders —including employers and employees, and
organisations repr esenting employers and emplo yees—have the opportunity to make a contribution.
Should the Commission require information from an
employer or employee or some other person, they will
be able to compel persons in writing to supply the i nformation and appear before the commission. The
Commission will also have the power to take copies of
the documentation provided.
Madam President, every three years, the
Commission will be required to make a report to the
Minister responsible for Labour with regard to the pr oposed minimum hourly wage. It may be necessary for
a review within the three -year cycle in the event of a
significant economic change in Bermuda or unfor eseen consequences of the minimum or living wage that need to be researched and rectified.
Madam Presid ent, the Bill sets out the r equirements for the content of the report that the Commission is to submit to the Minister, which i n622 29 July 2019 Official Hansard Report
Bermuda Senate cludes (1) the determinations of the Commission on
the findings and conclusions of the research, enqui ries, consultations and recommendations; and (2) the
subsequent recommendations and the reasons for the
recommendations. Madam President, the Bill requires that the recommendations must include an analysis of
the impact on the economy of Bermuda, the compet itiveness of the economy of Bermuda and any other
issue that may have been raised by the Minister r esponsible for Labour.
Madam President, once the Minister has r eceived the report, he will be obliged to table it for the House of Assembly and the Senate, and may by order
prescribe the minimum hourly wage.
Madam President, a living wage is different
from a minimum hourly wage in that it purports to pr ovide a decent standard of living for the worker and his
or her family. Madam President, as with the minimum
hourly wage, the Commis sion is also mandated to
make a report to the Minister responsible for Labour
every three years with a proposed living wage rate. The requirements for the production of the report are
the same for the determination of the living wage rate
as they are for t he minimum hourly wage. Once the
Minister has received the report, he or she must table
it in both Houses of the Legislature, and may by order
prescribe the living wage rate.
Madam President, the Commission’s powers
are accompanied by enforcement measures . Persons
who fail to produce any record, document or information; intentionally delay the work of the Commi ssion; or refuse to answer any questions are subject to
a fine not exceeding $2,000 and $100 for every day that the offence continues. In the case of a corporate
entity, the fine will be $7,000 and $500 for every day
that the offence continues. Madam President, the Bill
provides a regulation, an order -making power, for the
Minister, which will enable him or her to prescribe the
minimum hourly wage, the living wage rate and any
matters that are necessary for carrying out the prov isions of the Bill. The regulations will be made in due
course following the Wage Commission’s report and
recommendations.
Madam President, we are clearly well behind
the times internationally in the establishment of a mi nimum wage. The ILO asserts that more than 90 per
cent of their 186 member states have one or more
minimum wages set through legislation or binding co llective agreements. Today we are on the road to ma king a livi ng wage a reality for Bermuda. Our people
deserve to live in dignity. They deserve to enjoy decent work. And a part of that is to provide for a living wage, and this legislation will make it happen.
In conclusion, I would like to thank the Parli amentary Jo int Select Committee for their work in the
production of the report and on the establishment of a minimum/living wage regime. Thank you, Madam
President.
The President: Thank you, Senator Hayward.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITORS
The Presi dent: I would, at the time, like to
acknowledge the presence of the Permanent Secr etary, Chris Farrow, policy analyst, [sic] as well as Jane
Brett, policy analyst . . . Sorry. Jane Brett is the policy
analyst. But anyway, the Senate welcomes both of
you to the Senate.
[Laughter]
[Employment (Wage Commission) Act 2019, second
reading debate, continuing]
The President: And now back to the business at
hand.
Would any Senator care to speak on this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident. Thank you, Senator Hayward.
Certainly, ensuring that people are able to live
in Bermuda on what the most basic of pay rate allows
is an important thing to ensure that we achieve. What
I am certainly struggling with, and this is where, I
guess, the devil is always in the details, is what . . .
when I was on the Joint Select Committee which
seems to have preceded this Commission that will
then determine what the wage is, one of the key things we, at least I, struggled with was the detail of breakdown that we could get from the Office of the
Tax Commissioner.
Obviously, and this seems to have fallen off a
bit with the Living Wage Commission Act from the m otion laid in another place that set up the Joint Select
Committee that s eemed to target the effect of foreign
workers on lowering the . . . essentially the market
price for labour at the lower end of the pay scale, and
[what] effect [it] may have had on Bermudian workers.
But again, that was the assumption put forward in the motion. And it was really hard to find the supporting
data behind that because the Payroll Tax Commission could say that certain industries paid “X” or “Y,” but
they could not say to whom on a kind of broader demographic scale they were falling to.
So, tha t made it kind of difficult to understand
what the effect of the living wage would have on di fferent groups of people. Obviously, there is a living
wage for someone working in Bermuda with a family,
with children, with all these things in Bermuda. And I
know this [about] the Wage Commission Act now, the
cost of child care is included in the living wage. So,
and again, this raised problems when we were di scussing it, theoretically, at the Joint Select Committee
level, well, how do you set the wage on no- children,
Bermuda Senate one-child, two- children, three- children, et cetera? And
as those are individuals’ choices, is that a burden that
should be borne by an employer, by the Government?
How are we passing on these costs?
And if a certain wage was raised, would all
that i ncome go . . . would that all of a sudden entice
Bermudians to work in those industries? Would it
simply be increasing the amount of foreign cash sent
overseas for people who are able to, essentially, r educe their cost of living in Bermuda as they are, you
know, looking for economic opportunity, and this kind of thing? And I say that not . . . there is a clear distinction between exploitation and people who choose to,
say, bunk as an adult because their spouses and chi ldren are back home. And that is a beneficial short -
term economic position for them.
The other struggle was with tipped wages.
And the numbers from the Payroll Tax Commission
and other reports seem to only capture what is the
base pay and not the amount of money earned in gr atuities. So, one c ould say someone is earning $8.00
an hour as a flat wage, but they could effectively be
taking home $24.00, $25.00 because of the way that
industry has developed its payment and reimburs ement culture, based on kind of a profit share on vo lume of business done.
And there did not seem to be any really good
data for us to make decisions, and what positions taken could, you know, adversely affect the employees,
adversely affect the business operators and/or completely cost -out hospitality as a destination, depending
on which way those assessments were made. But
again, there was a rather glaring lack of, kind of, ec onomic data which we could come to unbiased recommendations on. So, I am assuming that the reason
another commission was set up after the previous
committee was to continue to academically research
this and get some good data so that we can have a
policy which protects employees, insures that the cost
of business and the cost of living in Bermuda are not
radically skewed and that allowed people who want to
work to not feel like they are being excluded simply
because there is exploitation- level wages or expect ations coming out of it.
So, we certainly support the continued work of
this Commission . But we would like to see what
comes out of it at the end and how much consultation
and research have been done accordingly. Thank
you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, Madam Pres ident.
Madam President, there are many studies and
articles surrounding the subject of minimum wage and
the benefits, the real benefits of implementing such a regime. Obviously, there are also studies showing the
economic, possible economic downsides of impl ementing a minimum wage scheme, as well.
Additionally, while there have been attempts
at calculating the so- called living wage, which is quite
different from the minimum wage, as we have heard
earlier on today, there are very few countries that are
actually implementing a living wage on a required,
legal basis. There are a number of countries that have
voluntary living wage amounts, but very few that have
actually implemented a living wage regime.
The UK is one of the few countries that has
attempted to move in the direction of establishing a
living wage, having recently established a new nation-al living wage payable to workers over 25, effective in
April of 2016. This wage rate is substantially higher
than what was the national minimum wage rate, but in itself is n ot a true living wage rate. It is something less
than a true living wage rate, some fall somewhere in
between that. And its aim is to reach a wage rate level
of about 60 per cent of the median UK earnings.
A living wage rate has been determined by
many co untries and cities around the world, as I said.
But most of them are voluntary. However, in the Uni ted States, for example, there are 122 living wage ordinances in American cities. So, they are not necessarily state- wide. They are not necessarily federally
implemented. But there are some ordinances that ex-ist in the cities in the United States. So, the living
wage is not something that is new, but it is something
that is being implemented in few countries around the
world, and it tends to be in cities and ordinances.
My own view on this complex subject is there
can be real benefits to those who remain employed after the implementation of a minimum wage regime,
and that the possible economic downsides depend
entirely on the country in which the minimum wage is
being implemented, its own economic circumstances
and, probably more importantly and just as key, the level at which the minimum wage is set. And we have
heard some questions this morning about whether the
minimum wage, for example, would include tipping or
exclude tipping. And if so, how is it calculated?
Studies have shown that some cities within
countries, the implementation of a minimum wage has had a positive impact on employment, while in others,
it is not entirely clear what that impact has been, neither negative nor positive. Additionally, certain types
of businesses have been affected positively or neg atively more than other businesses. There are 159 countries around the world that have a minimum wage at present. And they include USA, Canada, th e UK,
Australia, France, Germany and many more. The
Cayman Islands, the BVI, the Bahamas, Barbados, St.
Kitts, Trinidad and Tobago all have minimum wage
regimes. And they have legislation in place. So again,
what we are debating or what we are discussing t oday
is not something new.
624 29 July 2019 Official Hansard Report
Bermuda Senate Now, before I go any further, just to put ev erybody at rest, I want to say I am in favour of establishing a wage commission. So, I will put that behind
us, and then we can move on to some other points. I
think it is important we do have a wage commission.
It will be the work and recommendations of
this Commission that will be absolutely critical in d etermining the outcomes of establishing a minimum wage. All those who live and work in Bermuda should
be able to live with dignity, as we have heard, and be
able to feel that they are not intimidated in the wor kplace or feel uncomfortable about complaining about the wage rate, which many feel at present. And I think
we have heard that there are some employers who
are taking advantage of that, both Bermudian and
non-Bermudian staff.
I want to say that it applies not only to the
wages that some workers are being paid, but in some
cases the living conditions in which some of our wor kers have to exist. And I do not want to let that go wit hout some mention. It is not just the wages that are
being paid, but it is the living conditions in which some
of these workers are having to exist.
So, Madam President, it is a delicate balance
that we have to keep between paying a fair wage for a fair h our’s work whilst at the same time being alive to
the effects that an increase in operating costs may
have on businesses in Bermuda. And as I said during
our discussion on the amendments to the Health I nsurance Act, a company has a number of options that
they can adopt when costs go up, one of which is
simply to increase the price that it charges us for its
goods and services.
So, as was stated in another place 10 days
ago, Bermuda’s cost of living is a major concern for
Bermudians. And when the Wage Commi ssion meets
to consider a minimum wage, it will, as required under section 10 of this Bill before us, Madam President,
have to make, in conclusion, if I may quote from section 10 —
The President: You certainly may.
Sen. James S. Jardine: It says, “shall s pecifically
state the effect of the determinations made . . . on the
economy of Bermuda as a whole.” So, that is one of
its requirements that it has to fulfil as it comes up with
a minimum wage.
The big question is, Will the establishment of
a minimum wage and eventually a real living wage
result in a loss of jobs? As I have said already, there
is an enormous amount of literature on this topic. And there are studies which suggest that there will be job
losses, and others that show that there will not be job
losses. There is a huge amount of literature out there.
And I must say, I did not plough through all of it, but ploughed through some of it. And I just wanted to refer
to one or two pieces. The first one is an economic r eport written by the Federal Reser ve Bank of San Francisco, dated December 21
st, 2015. And they conclude, on page 5 of their report, after examining a
great deal of evidence, and if I may quote them, Madam President?
The President: You certainly may.
Sen. James S. Jardine: They say as fo llows: “ Coupled with critiques of the methods that generate little
evidence of job loss, the overall body of recent ev idence suggests that the most credible conclusion is a higher minimum wage results in some job loss for the
least -skilled workers —with pos sibly larger adverse
effects than earlier research suggested. ”
Now, the key to that is, and I just want to r epeat that. The conclusion is a higher minimum wage results in some job losses. So, to me the critical point
is, what rate do you set for the minim um wage? And
that will determine, to some extent, whether or not it
has any significant impact on existing jobs. So, it is
important that the Commission get the minimum wage
rate right.
And I will make one further interesting observation from a detailed s tudy carried out by Meer &
West from Texas A&M in 2015, in which they co nclude as follows —and if I may quote them, Madam
President?
The President: Certainly. You certainly may.
Sen. James S. Jardine: They say the following: “ The
voluminous literature on minimum wages offers little
consensus on the extent to which a wage floor i mpacts employment . . . [W] e argue that the effect of the
minimum wage should be more apparent in new employment growth than in employment levels . . .” (And
that is key, new employ ment growth rather than current employment levels.) “[W]e find that the minimum
wage reduces net job growth, primarily through its
effect on job creation by expanding establishments. ”
(So, that is establishments that are already existing
and looking to exp and.) “These effects are most pr onounced for younger workers and in industries with a
higher proportion of low -wage workers. ”
So, they also say in their report, and I did not
quote it here, but they also say in their report that, for
new businesses that are seeking to establish, they will
be looking at the minimum wage rate. And if it is of a
sufficiently high level, they will look to automate in a
more effective way rather than hire additional staff.
So, I just wanted to stress that. They are tal king about new employment growth, not necessarily those jobs that already exist.
So, Madam President, you know, there are
many information papers available online, which shows that certain jurisdictions have dealt with deter-mining minimum wage in different ways. Now, I know I
am going to be criticised for referring to our neigh-bours to the south. But we can learn from them, as
Bermuda Senate they have learned from us many times in the past.
And if you will allow me just to mention one.
The President: Absolutely, you can.
Sen. James S. Jardine: And I am referring to the
Cayman Islands. They went through this exact same process in 2015. And their minimum wage advisory
committee report issued in February of 2015 was extremely informative. Now, it is 220 pages, and I am
sure people do not want to plough through it all. But if
you do plough through it, it sets out a very good
guide line of what they followed in coming up with their
minimum wage. Now, I am not suggesting that we
should just blindly copy what they did. But it does pr ovide something for our Wage Commission to at least
read, if they have not already read it, to give them some idea of how they might want to approach coming up with a minimum wage.
And it includes a lot of things that are mentioned in our Bill here that shou ld be considered. They
actually go through the process, so you can see how they have determined what, for example, economic
impact it would have. Now, they have set their minimum wage at CI$6.00 per hour, which is about
US$7.20 per hour. So, as I say, they actually also
brought in the ILO to give them advice. And we have
heard Senator Hayward refer to them in his opening
remarks. They were heavily involved in their process,
as well.
The report from the Bermuda Joint Select
Committee on this report was also very informative.
And I did go through all of that several times. And it showed the work that they have carried out. And it
also acknowledged, on page 9 of their report, and if I
can quote it, Madam President, because I think it i mportant again.
The Pres ident: You certainly may.
Sen. James S. Jardine: And they said as follows: “ It
is acknowledged that the analysis conducted has lim itations, and the members are also cognizant of the
unintended consequences that can arise if this pr ocess is not well consul ted and well thought out. ” So,
they themselves recognise that the process that this
Commission has to go through has to be fairly consu ltative. It has to be fairly detailed so the rate that they
come up with at the end of the day is something that
is fully supportive.
Madam President, on pages 13 to 21 of the
Joint Select Committee [report], and again they came up with certain insights, they provided certain insights
to the various methodologies that are used throughout
the world. And I believe there were three different versions. And it was useful to see that. And one of those indeed was the one that was selected by the Ca ymans in coming up with their minimum wage rate. The Joint Select Committee also recognised
the importance of the effect of the minimu m wage levels on the cost of living in Bermuda. So, they do not
just blindly send this out. They did actually consider it.
And I wanted to quote specifically from them. (And I am looking at Senator Richardson, because I think he
is going to fall into play here.) And it says, if I may
quote them, Madam President.
The President: Yes, you may.
Sen. James S. Jardine: They say, “The Cost of Li ving Committee is equally as important, as they review the competitive economic environment to assess
whether or not a lack of competition within key ec onomic sectors artificially inflates the cost of goods and services.” So, there is a sort of dynamic role being played by the Cost of Living Committee and by this
Commission, working in tandem as they go through
this proces s. And again, that is, in my mind, a very
important process.
So, Madam President, there is a huge amount
of literature out there. And I think what you read today
may be different from what you read yesterday. I think
the key point I want to get across is that the level that
is set for the minimum wage will determine what i mpact it has on cost of living. It will impact . . . probably
going forward, not so much for the existing jobs, but
for job creation, it will impact the jobs that may or may
not be created in the future. And I think that is i mportant.
There were two comments I wanted to make
on the Bill itself. And the first, if I may refer to them, Madam President, was clause 3(2)(a)(iv), clause
3(2)(b)(i) (it gets very complicated), and clause 3(4),
addressing young persons. And I see that the Bill
does not apply to anyone under the age of 16. But any
students above the age of 16, subject to certain r equirements of other Acts, are caught by this Bill.
And it just seemed to me that, if we are going
to sa y that students between the ages of 16 and, let
us just say 22 or 23, are subject to this Bill, and ther efore, those higher rates have to be paid, that may have an impact on summer employment or indeed on
holiday employment. If the rates are too high, bus inesses that might normally have taken students in
and paid them something fair and reasonable just
simply may not hire them.
So, my concern is if students between the
ages of 16 and, say, 22 are impacted and do have to
fall into this regime, they may find it more difficult to
obtain jobs. And I just sort of sound that note of caution and concern. And again, there are studies out
there that have shown that, in fact, it has had no i mpact, and studies that have shown that it has had an
impact. So, I think we just need to be alive to that one.
Clause 7 appears to give the Commission
fairly broad powers to request information (and I quote from the clause) “such record or documents” as they
626 29 July 2019 Official Hansard Report
Bermuda Senate may request. Madam, I understand that the Commi ssion needs to get inform ation, and they should get
information that is relevant to the work that they do.
My concern is that they want to get information that is
relevant to what they are doing, and hopefully will not be going and looking for information that is not rel evant.
And I guess one small amendment that I
would suggest might be that the Government look at
and consider, and it is in clause 7(a), which could
read, for example, “to supply that information” and “[(b)] to [produce] such record or documents as may
be specified” —and this is the bit that I would add—
which might reasonably be required.
Now, I suppose . . . I am not a lawyer, but that
seems to be a term that lawyers love to use, it might
reasonably be required, because they can argue that
it is not reasonably requ ired. But it is just something
that I think, as a cautionary note, might be worthwhile
adding so that people do not go on fishing expeditions
for stuff that is not relevant to the job at hand. And I think that this is something that should be considered.
So, Madam President, as I said in my earlier
comments, I support this establishment of a wage
commission. I believe that there are people working
on this Island who are paid far below subsistence le vels. And again, it may be by choice, and that they are
prepared to be paid that and are quite happy with it.
And probably just as important are those who feel they do not have any other choice. They need to have
a job, so they take whatever wage is on offer. And
they are being paid at well below a reasonable subsistence level.
I want to finish with my own personal comments, as I said earlier, but also comments from another place . . . well, not another place, [but] another
island, I should say. As I have stated earlier, I think it is very important that the mini mum wage that is set is
carefully thought through. And so, I want to really co nclude my comments by supporting that thought by
again quoting from the Caymans Islands Minimum
Wage Advisory Committee report, and I am sure I am
going to be chastised for all of these quotes from them. But I think it is very relevant, and it sums up my
complete thoughts on this.
And, if I may quote from them, on page 77 of
their report?
The President: You absolutely may.
Sen. James S. Jardine: They say as follows: “The
aim sh ould therefore be to establish a framework for a
minimum wage that strikes a balance” (or as I would say, Madam President, the right balance) “and which
is beneficial to the labour market supply while remai ning affordable to employers and not seen as hampering businesses and the economy.” Thank you, Madam
President.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
Senator Richardson, you have the floor.
Sen. Anthony Richardson: Good morning, Madam
President .
The President: Good morning.
Sen. Anthony Richardson: Hello, Senators and
those in the listening audience.
As is typical in these debates and convers ations, we do necessarily think through the financial
and economic aspects. What I want to do, Madam
President, is preface my comments with two short,
real conversations that I have had in the recent past in
preparation for today. One was, I was talking to a
guest worker, a professional person. And he was g oing through talking about his experiences. He has
been in Bermuda for about less than two years now.
And I was asking, as we normally do, you know,
How’s it going? and what have you. And he said that
one day he had an experience whereby he worked in
an office and someone had been dismissed. And the
person came to him in a different situation and said,
you know, It’s because of people like you that Bermudians don’t have jobs.
And he talked to him in terms of, first of all,
the person who made the accusation did not know what this person’s job was. And then, after the conversation, he talked about the idea that he was a qual-ified accountant and the person who was dismissed
was, effectively, a handy -person, but who often turns
up late and all the rest of it. So, there was, in his mind, justification for that person to have been dismissed.
But then he went on to talk about the idea that some of the things that he has seen . . . Oh, his perspective
of Bermuda was that Bermuda is a land of opportunity.
And then he talked about from his homeland,
or from where h e lives, that they have a different perspective in terms of, you do not necessarily have, for
example, three meals a day. And you do not live in a
place that is reasonably comfortable and those things. And so, we talked about what is effectively a mind- set.
And so, I will come back to that in a few minutes.
Another conversation I had was with another
friend, who is visiting from the US, but lived in one of
the islands before he went to the US. And we actually
did a bit of a drive around Bermuda, and then w e got
on a boat tour. And, you know, naturally, as you are
driving or on a boat, you give comments about what
you see. And he was quite taken aback by what he
saw as Bermuda’s extreme wealth. And we did go
around, you know, the harbour and up to Morgan’s
Point and all the rest of that.
And then, further on, we talked about the idea
that, yes, this may be what you see. But the reality is
Bermuda Senate that, in the Bermudian context, it is superficial. B ecause there are many, many, many, many, many,
many people who could not possibly afford to live in
some of these accommodations, and who do get paid
quite a minimal salary in that respect.
And so, for me, this . . . yes, I understand, of
course, that there are the financial impacts. But there
is a human element to what w e are talking about t oday. And I think that has to be brought to the fore also
as part of this discussion. Because notwithstanding
what we may sometimes see on the surface, the real ity is that the cost of the fuel and food and vehicles,
electricity, bank f ees and all the rest of it —they are the
same for all of us irrespective of how much money we
may earn.
And even as recently as this weekend, I was
doing some online banking. And I said to myself,
There was a furore in the recent past when both
banks incre ased their banking fees . But now it has
died down. But the reality is that you still have to pay
those fees. So, it is a $10.00- per-month per account
fee and a $0.50- per-[transaction] fee for online transfers. And I know from my previous job that those things will add lots to the bank’s bottom line. But we
will not necessarily remain focused on those things
beyond the initial complaints when it took place. And
so, I will leave that there.
My other comment, to bring into focus, is that
again what we are used to is a capitalist society. And the reality is that capitalism is based on exploitation.
So, as a business owner, what I am going to try to do
is set my prices as high as I can. And to the extent
that I employ you, or anybody else for that matter, I am going to pay you as little as possible to ensure that
my profits are maximised. And that is one of those
realities for us in Bermuda. And my comments may be
a bit stark, I suppose. But we have come to accept
that. And even as we go about our daily lives, we do
not necessarily object to the idea of one person b ecoming very wealthy while other persons are just able
to manage.
And I am saying all of that to say that part of
this work and part of what we have to adjust to is the
whole mind- set now in terms of r eally, for all persons
who are involved in business and also the workers, how much is enough? To what degree are we pr epared to continue to allow [for] the excesses of wealth
in the context of persons who are not able to really
manage?
There were comments earlier in terms of,
what will the reference point be for setting, initially, the
minimum wage and, ultimately, the living wage? And should there be an impact in terms of, do I as the employee have one child or two children or whatever the
case may be? And am I married or otherwise? And
the reality is that while each job may not be evaluated based upon my circumstances, we have to factor that
into what we do. Because the community, the broader-based community, right, is starting in a big way to see the impact of persons not being able to manage
their daily financial obligations.
And so, we have to really, in my mind, press
Pause and think about that. And, yes, there are going
to be some financial implications in terms of whatever
the rates are set at. But at some level, the question is,
Is a job worth existing even if the person is only going
to be paid, say, $5.00 an hour? Because we have also
had situations in Bermuda whereby —and I think Senator Jardine referred to this —some persons earn such
little wages that they cannot afford to live, except
there are multiple persons living in an accommodation. And I think we have heard, we may know ourselves personally, but we have certainly heard anecdotally whereby you may have a one- bedroom apar tment, for example, with up to six occupants. Because
that is what they have to do in order to afford the Bermuda rents.
And in many cases, I think when we hear
about it anecdotally, it refers to some of the nonBermudian workers who are here being paid very low
wages, but t here are also many Bermudians who
have these same circumstances in that you may have
more than one family living in very, very small accommodations. And from that, we see multiple dy sfunctional social implications or impacts.
And so, to go back to the per son I mentioned
initially whom I talked to about what we are used to, it
is for us to now start to contemplate a difference in
that, yes, there are going to be, there may be, and I
guess there are going to be some job losses. But
some of those job losses m ay even be done as an
excuse. And as a business owner, part of the conversation and consideration is, okay, if you are making
“X” amount of money, what amount of that should r eally be shared with the workers? Because at some
level . . . Listen, if you are making “X” amount, why
can’t more be shared?
And again, that is what I am talking about,
about these shifts in mind- set that we have to go
through. And it is not easy, because from a business
perspective, it is . . . you know, I have taken the risk; it
is my idea. My money is on the line. I have to pay
bank loans and all the rest of it. But I think that is going to be a challenge for us as Bermudians , our society in terms of like going forward. Really, what is going
to be our emphasis in ensuring that Berm uda as a
society is able to continue as we go forward?
And having said that, I do recognise there are
several marginal businesses in Bermuda. And what I mean by that is that there are some that are not mak-ing any profit in the full context of what a profi t is. And
in some cases, it is evidenced by persons saying that,
My employer is stealing from me as an employee. And
that arises because I might pay you, let us say,
$1,000 a week in this instance. And I make deductions for health insurance and pensions and all the rest of it. And I do not, then, pay those across to
where they are supposed to go. And that is where the
628 29 July 2019 Official Hansard Report
Bermuda Senate accusation arises. But in some cases, I have a very
marginal business, and I do not have the amount of
money, in any event, to pay all those deductions. And
that is why I do what I do.
I am not justifying that; but I am saying that
there are going to be some circumstances by which
those businesses may falter, but I justify that by sa ying this, is it appropriate for that business to be in existence if it cannot really fulfil its own obligations? And
again, it is for us to start thinking this through, that these are going to be some of the realities of doing what is being proposed by the Wage Commission. But
there has to be a fallout. It is what it is in that sense.
And when it comes to my example in terms of
profitability, helping to determine what the impact
should be on workers, if we go back to probably the
late 1980s or early 1990s, there was huge discussion, from the negotiation point of vi ew, between the unions
and the Hotel Association, effectively. And the push
back and forth was around, w ell, what is the profitabi lity of the hotels in order to justify what the unions were
demanding or requesting? And ultimately, what they
did was they individually sent the information to Price
Waterhouse. Price Waterhouse was then able to a ggregate the data on a confidential basis and then give
it back, because the people knew, generally speaking,
what the hotel industry was doing. And that then gave a more realistic basis for the negotiations to continue.
And obviously . . . not obviously, but then, ultimately,
get to a successful outcome.
And so, those are some of the things that we
are going to have to do that may be radical to really
understand if the minimum wage is really the reason why someone becomes unemployed. Or is it the bus iness interest being ultimately selfish in its decisions?
So, rather than me have a lesser profit, I will dismiss
you. And I am saying, in my mind, that is sometimes
an exc use. We have to start figuring out what is reali stic if we are serious about living in Bermuda, going forward. It is a serious conversation to be had.
And so, Madam President, I am one of those
who certainly look forward to the work of the Commi ssion, all of the analysis and the reference points that
they will use. And from a business perspective, yes, I
am prepared to consider what will have to happen in
terms of ultimately sharing more of the business i ncome with the workers.
As a final comment, going back to the person
whom we were going on the cruise with, he works in the medical profession as a partner in an entity. And
he suggested to his fellow partners that the profit of
the business should be shared on a bonus basis with the physicians, the nurses and the rest of the persons
who work in the medical facility. And he was cha llenged by, effectively, What is wrong with you? Why would you want to do that? And I am saying that this
is the reality, that if there are profits being made, there
may have to be a different basis upon which we really
consider sharing those profits. And my final comment, Madam President (I
think it was referenced by Senator Jardine) –is that I
want to say back in the day when it came to tips, you
may be aware or Senators may be aware that a lot of
Bermudians worked in the hotel industry as part of
going between, say, age 16 and probably 20 (or 22 or
25, for that matter), during university. And at that
stage, what used to happen is, number one, I would
work in the dining room and I would receive my tips in
cash. There were no guaranteed gratuities or whate ver the case may be. And then, there were also the tips
that went in a pool. And at the end of the month or the
week, the maître d would say, Okay, fine. This has
been the pool of the grats. And then they would split
[the money] based upon a skill, between the waiters,
the bus boys and all the rest of those.
And so, there was much more of a direct attribution of those gratuities with the extra workers, whereas now, in some cases, the gratuities are mandatory. They are on your bill. And so, I as the worker do not even see that. And in some cases, we may be
aware that the employers are using what is the gratu ities as part of their own income. And so, there is a
degree of unfairness w hen it comes to this taking
place.
And so, Madam President, those are my
comments. And we are just trying to emphasise the
fact that there is a significant human element in what is being discussed. And again, I look forward to the
outcomes from the Wage C ommission to see how
they are going to have a positive impact on the social
fabric of Bermuda. Thank you, Madam President.
The President: Thank you, Senator Richardson.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR S
The President: And before I determine whether any
other Senator wants to speak, I would just like to
acknowledge the presence of the Permanent Secr etary, Ms. Aideen Ratteray -Pryse, in the Gallery, as
well as Mr. Francis Richardson from the Shipping and
Maritime Authority.
Welcome to you both.
[Employment (Wage Commission) Act 2019, second
reading debate, continuing]
The President: Would any other Senator care to
speak on this Bill?
Senator Jones, you have the floor.
Sen. Marcus Jones: Thank you, Madam President,
and a hearty good morning to my colleagues here in
the Chambers and to the greater listening audience.
I am going to springboard off of what my co lleague, Senator Richardson, was making very clear.
Bermuda Senate And my words, the fact that we are in a capitalist soc iety, so profit is the driving force for businesses. We
know that socialism is a different animal, where most
of the decision- making for an economy, for goods and
services being produced by our population, is determined by the government. So, there are different
things driving it.
So, we know that in a country like Bermuda,
where we know we are battling with the high cost of living, the number -one ticket item in any business is
the cost of its labour.
And just to make a comment in regard to gr atuities, having worked in the hotel busi ness and reali sing that gratuities have always been, shall I say, a
contentious issue amongst employers and employees, and we do know that earlier in the early years when
Bermuda went through the transition of voluntary gr atuities to mandatory gratuities, there was a time when
employers did their best (I am talking about in the hotel industry; I am not too sure about the restaurants)
. . . but I know in the hotel industry, there was a certain level of gratuities that were being held by the employers to augm ent some of their revenues to be able
to handle and underwrite the cost of labour.
But since which, we have had a number of
agreements between the Hotel Association and the
unions. I would say quite confidently that over the last 30 years, that has not been the practice. In fact, all
gratuities that are received by the hotels are actually
paid out to the workers. So, there is none of the keeping of gratuities by the hotel employers, because most
unions would tell you that they ensure that their repr esentatives are actually given a calculation sheet of
how much was generated in gratuities and how much
was actually paid out to the workers.
But having said that, because the employees’
salaries and pay is such a large ticket item on any
operation, any busines s operation, it is very sensitive.
One of the thoughts I had was, in the hotel industry, we know that once the hotel, Madam President, hits
70 per cent occupancy, the employer is allowed to do
lay-offs. And that is the hotel’s way of responding to
the drop- off in business. They lay off workers so they
can reduce their costs. I can possibly see hotels and
the like in the future saying, We want to increase that
occupancy level, because we have got to pay more in
minimum wages. We want to be able to have some
flexibility, and we may suggest that, hey, maybe that
occupancy percentage should go up to 75 per cent to
allow for the wiggle room to be able to make up for the
increase in the minimum wages.
Now, we are in favour, definitely, of this Wage
Commission. We realise that the number -one purpose
of putting together a minimum wage is to minimise the
exploitation of workers in this country. We probably,
all around this room, have been able to see examples of that happening within our community. We know for
a fact that, in more ways than not, our foreign workers are probably the number -one targets in unfair rem uneration for their work.
I will say this, though. With the implementation
of a minimum wage, I would like to think optimistically
that there will be more of a level playing field, where the foreign worker will not be as exploited as much,
because the statutory minimum wage limit will be in
place. So, we should not see as [often] the foreign
worker being chosen over the local worker because
the playing field has been levelled.
We also recognise that the minimum wage
should be sufficient enough to allow for a worker on the lower scale to be able to enjoy a reasonable
standard of living, where they will be able to afford the
basic necessities in life —food, shel ter and things like
that. But what is going to be a challenge for this par-ticular Commission is to find the sweet spot, strike the right balance between protecting the worker and at
the same time creating a flexibility for companies to be
able to be compet itive. That is going to be very, very
challenging.
And in my looking at the legislation, I took
note of [clause] 6(3). And, if I am allowed to read that,
Madam President?
The President: You certainly may.
Sen. Marcus Jones: “The Commission shall, as it
may be deemed necessary in the course of perfor ming its functions under this Act, consult with —(a) e mployers; (b) employees; (c) organisations . . .” (that
represent both employers and employees) “(e) Government Departments; and (f) any other person or
body of persons.”
When I read that, I was struck with the word
“consult” with that list of persons. And I felt very
strongly that [sitting] on that Commission should be
actual practitioners within the workforce, who are actually dealing with the challenges of making oper ations and businesses work —i.e., actually having on
that Commission union representatives, actually having on that Commission business owners who generally, the majority of their employees are on the lower
scale of workers —i.e., hotel management, restaurant
owners. Those are the employers who generally have
workers who will be living off of the minimum wage.
Because as practitioners, they will be able to take
what is theoretically decided by the Commission and
actually be able to apply it to da y-to-day operations , I
think that is very important.
The question of gratuities . . . and one may
consider a sliding scale. We know that during the off
season between November and March, the gratuity
pool is going to be very small compared to the on
season. So, one consideration may be made, does
the minimum wage for that industry have to slide
based on the season that they are operating in? I will challenge you to even venture to request that the
workers take less gratuities in replacement of a higher
630 29 July 2019 Official Hansard Report
Bermuda Senate minimum wage. I would not think that they would be
up for that. But that is going to be a challenge. And I
think there are ways of making it fair for everybody.
So, in closing, Madam President, we definitely
are in favour of this particular legislation. I be lieve it is
important. I am concerned that, with the minimum
wage that does not hit the right balance, we may have
the threat of employers reducing hours or not —or
even hiring on a part -time basis workers as opposed
to full -time workers to control that and to minimise the
impact of this particular statutory minimum wage rate.
So, I think that needs to be looked at, and we need to
be sensitive to that.
But I believe this legislation strikes the right
chord, is going in the right direction. And, Madam
Presid ent, I thank you for the time.
The President: Thank you, Senator Jones.
Would any other Senator care to speak?
Senator Michelle Simmons, you have the
floor.
Sen Michelle Simmons: Thank you, Madam Pres ident.
I am going to be brief because so much has
already been said about the need for establishing a
wage commission. I totally support this Bill. And I
think, as has already been stated by Senator Hayward
when he presented the brief, it is clear that Bermuda
is already far behind in terms of global polic y with r egard to a minimum wage and, indeed, even in terms
of establishing a living wage.
I am sure that all of us around this table recognise that there is exploitation happening in Berm uda, exploitation of workers who are being paid very
low wages. I am concerned that all employees who
are gainfully employed in Bermuda should be treated
fairly. And therefore, in terms of one’s national origin,
in terms of whether you are a Bermudian worker or a
worker from another country, I think that workers
should be paid equally in terms of workers who have
similar roles in their employment contract.
I would like to just take us to the Bill on page
7, where we have, in Part 4, the Determination of Li ving Wage Rate. When I read the definitions, or the
meaning, of “liv ing wage rate,” and if I may share this,
Madam President, I will just read it very quickly.
The President: Yes, you certainly may, Senator
Simmons.
Sen Michelle Simmons: It says, in clause 12(1), “For
the purposes of this Act, ‘living wage rate’ means th e
amount of income necessary to afford an employee
and his household a socially acceptable standard of
living calculated to take into account such factors as . . .” and there is a list. I will come back to that list in a
minute. My concern in this meaning, or definition, is
“his household,” because that could mean any size household. And if people are using this as their basis
for establishing a living wage, surely we need to more
closely define “his household.” Should it be a refer-ence sized household? Should it be a household of
two, three, four, up to ten people? I am just concerned
that this needs to be tightened up a bit.
Also, with regard to the factors given in that
same clause, it does say . . . Madam President, may I
read it again?
The President: You certainly may.
Sen Michelle Simmons: It says, “a socially accept able standard of living calculated to take into account
such factors as the basic cost of –(a) food; (b) housing;
(c) clothing; (d) medical care: (e) child care; (f) transportation.” Ther e is something that could be included
in the list, because I know that it says “such factors as,” but I think it deserves its own line item in that list,
because I know when I look at my monthly expenses, it is probably the largest bill that I pay. And that is util ity costs, which we all know are extremely high in this
country.
So, included in that living wage calculation, I
would like to know definitely that the commission will
be looking at what this household is paying in terms of utility costs.
So, Ma dam President, I said I would be brief. I
support all of the concerns already expressed about how we need to be treating employees in this country in terms of treating them fairly. And I would just ask
that the two concerns that I have raised be consi dered.
Thank you, Madam President.
The President: Thank you, Senator Michelle Si mmons.
Would any other Senator care to speak on
this Bill?
Senator Robinson, you have the floor.
Sen. Dwayne Robinson: Thank you, Madam Pres ident. Good morning to all our listening audience and
my fellow colleagues.
As my colleague has stated, we do on this
side agree that everyone should be paid a wage that is considered liveable in the country they reside in. My
concern (and I will be brief as well) is that the liveable
wage may tip the scale in the favour of big business.
And by that, I mean, if you have a small business, and
we all know small businesses’ backs are against the
wall right now with operating costs, an ageing popul ation, as well as lack of consumer purchasing po wer.
Most of the bigger businesses already, most
likely —I will not say as facts —but most likely already
pay a certain wage that would be considered liveable.
So, this particular legislation will affect those who are
Bermuda Senate currently paying what would be consider ed below a
liveable wage, which are most likely small businesses.
So, I am concerned that Bermudians may be hit as
employees who may receive notices to become part -
time. And these are things that have been brought out
by Senators around the table, but as c onsumers, as
well.
Now, in the capitalist society that we live in,
the less competition that you have tends to reflect on
the level of service you receive. And I do believe that
if we start to put more pressure on businesses that are up and coming, we may end up in a monopolised
society where larger businesses have the ability to
take and absorb the hit of a liveable wage [but] smal ler businesses may disappear.
So, I wonder and hope that this is taking into
account, when the liveable wage is created, whet her
or not, if these businesses do disappear, is our economy fertile enough for new businesses to rise up and
take their place. Do we have any sort of idea whether
or not folks will continue to take on the risk of entr epreneurship if the cost of living is still high and access
to capital is so restricted? So, I do support a liveable
wage. And I do believe that in our society, it is wrong
for those to be making so much while others make so
little.
But my biggest concern is that if we do go into
this without considering that we may be eliminating
the competitiveness of smaller business, then it may
backfire on us, because the liveable wage will not be
potent if people are unemployed. So, with those
comments, Madam President, I will close.
The President: Thank you, Senator Robinson.
Would any other Senator care to speak on
this bill?
Senator Campbell, you have the floor.
Sen. Vance Campbell: Thank you, Madam President.
I believe it was hinted at that there were days
in Bermuda when you could quit your job in the mor ning and by mid- day have another job. I will even take
that further. There were days or times in Bermuda
when you could have two or three jobs simultaneously. And many people did so to make ends meet. Some
did so so that they could enjoy certain benefits in life.
But [today the] days are more difficult. So, I would not
necessarily say they are gone, but they are more diff icult—to be able to find someone holding two and
three jobs.
And even if it was possible, you have to ask
the question, Is that a good thing, especially when in
many times it was a single parent who was working two and three jobs? So, it begs the question as to,
Who is looking after the kids and whether that has led
to some of the social issues we have today? But that is for anoth er discussion.
I do not envy the task of the employment
commission. It is not going to be easy. It is going to be extremely difficult to establish a living wage in a cl imate, Madam President, when Bermuda’s high cost of living has received much attention relative to the rest
of the world. I will focus on the fact that the Progres-sive Labour Party does not want to see anyone ex-ploited in any degree—not exploited less, we do not
want to see exploitation at all when it comes to the
amount that someone is paid. I think, you know, we
respect a business above a minimum level, a livingwage level, to reward superior performance. So, if an
employee is demonstrating superior performance, you know, this is not removing the choice of the employer
to pay that employee a little more.
It does level the playing field, but maybe not
from the perspective that was mentioned earlier if it then levels the playing field, then it costs the same,
pretty much, Madam President, to hire a Bermudian versus an overseas employee at that level. So,
whereas now, if an overseas worker is prepared to
work for a wage that a Bermudian cannot make ends
meet with, well, then, it is skewed in their favour.
I mentioned before in this Chamber about the
changing economic model when we were discuss ing
the retail business. And again, small business versus
big business, I mentioned at that time the big business
that has the corner, three- floor-story building , is a d inosaur. So, the newer businesses, the pop- up stores,
have less overhead and may be abl e to absorb . . .
and they are more nimble. Even if they have to take
out a physical, static presence, they are more nimble
than the big businesses, although they may be able to
absorb this better than the big businesses, I would argue, Madam President.
The final area that I would like to focus on, we
have spoken about the impact that this would have on
businesses, absorbing this greater wage. I want to talk
about the other side of that equation, the persons r eceiving the living wage when it is actually im plemented. Madam President, I can be paid $1 million. If I
spend $1.5 million, I am going to be in financial diff iculty. So, again, we should bring some education with
this in that, as I earn more, it should go to those bills
that I may have struggled to pay. It should not be an
extra trip this year or any trip at all.
So, again we need to bring some education.
And it does not change the impact of some of the choices and the habits that we spoke of earlier. You
know, if I earn whatever that amount, the liv ing wage
ends up being, I still have to be smart when I choose
to do certain things in my life, if I choose to do them at
all. So, I still have to have smart choices. So, we need to . . . with that living wage, I would like to see an education programme. T his does not mean that you have
hit the jackpot. You still have to be smart in your choices and the things that we do in life.
So, with those comments, Madam President, I
do support this legislation. And I think it is long over-due. Thank you, Madam President.
632 29 July 2019 Official Hansard Report
Bermuda Senate The President: Thank you, Senator Campbell.
Would any other Senator care to speak? I
think most people have spoken.
So, Senator Hayward, it is over to you.
Sen. Jason Hayward: Thank you, Madam President.
And I thank you, the fellow Senators, for t heir inte rventions in this particular debate.
I had the privilege of being on both the LAC
Subcommittee responsible for the living wage report
and also on the Joint Select Committee responsible for a living wage. And in both of those committees,
what we had to identify first and foremost, before we
even discussed whether or not the country needs a
minimum/living wage is, do we have a problem? And it was acknowledged by all in both committees that we
do have a problem. And so, in the LAC Subcommittee
report , the first paragraph, we tried to identify just the
basic problem in very layman’s terms. And if you will
allow me to read that, Madam President?
The President: You certainly may, Senator Hayward.
Sen. Jason Hayward: “What is the problem? There
has been a change in Bermuda’s job market from e mployment which was primarily in tourism to emplo yment predominantly in international business and r elated industries. This has significantly altered our ec onomic and workforce landscape. Bermuda’s economic
growth and development, coupled with other economic factors, have led to a high cost of living. And while
the cost of living has increased, wages in many job
categories have remained stagnant.
“Employment statistics reveal that there are
persons in Bermuda who fal l in categories beneath
the low income threshold. The cost of rent, food and
other basic necessities has steadily risen over the
years, while wages in many sectors have not similarly
increased. Particularly during the recession, there
have been instances w here workers have taken a decrease in pay, which has diminished purchasing po wer for many households. As a consequence of the high cost of living, Bermuda has experienced high levels of low -wage poverty.
“While the impact of poverty in Bermuda may
not be as easily recognised as it may be in other juri sdictions, over the last several years there has been a
significant increase in the number of working families
seeking financial assistance and other means of s ocial support. The demographics of persons seeking support have also changed. Historically, mainly unemployed or retired persons have sought support. But now persons who hold full -time jobs or who are under -
employed also require assistance.”
And so, that was recognised that, you know
what? There is a si gnificant portion of our population
struggling. We then went on to say, if that is the notion
that we support, then what is the evidence to support
that? And when we looked at it, we looked at the last low income studies that the Department of Statistics
actually produced, and that was in 2008. And those
low income studies, the report was actually titled, Low
Income Thresholds [:] A Study of Bermuda’s Hous eholds in Need. And that was a very important title,
Low Income Thresholds [:] A Study of Bermuda’s
Households in Need. In need of what? In need of what
in particular is this referring to?
And this is [referring to the] need of some sort
of financial assistance, some sort of subsidy, some
sort of uplift. There were three different measures in that one report . One was a relative low income
threshold. One was a low income cut -off. And one
was a low income threshold. Madam President, if you will allow me, I can just summarise the data that were
captured in that report.
The President: You certainly may, Senator Hayward.
Sen. Jason Hayward: As it pertains to a relative low
income threshold, in 2007 there were 3,680 hous eholds with incomes below the relative low income
threshold. And that was $41,000. The relative low i ncome threshold for single adult households w as
$38,000, and there were 1,115 households that fell below the relative low income threshold.
As it pertains to a low income cut -off, in [2007]
there were 3,050 households with income below the low-income cut -off of $36,605. The low -income cut -off
for a single -adult household was $33,630, which
trans lates into $646.73 per week. Twelve per cent of
single adult households fall beneath the low income cut-off.
And as it pertains to low income thresholds,
the low income thresholds study revealed that in
2007, there were 3,010 households . . . 3,100 hous eholds in Bermuda currently living below established low income thresholds, which ranged from $27,000
per year for a single adult household to $76,000 a year for a family of two parents and two children
younger than 16 years old.
And so, when we look at those numbers, we
see that there are persons who, under any other cat egorisation, would be living in some sort of poverty.
Remember, poverty is relative to the jurisdiction you are in. And so, no, we do not see those extreme levels
of poverty. But based on a statistical measure, we do
have households that are living in poverty. When we
say “households,” it is important that we recognise
that when we are talking about households, we are
not only talking about one adult at a time. Most times,
that adult can have children, which means that we
now have children who were born into conditions that
they have no control over.
This translates into the Government needing
to put some form of policy in place. There are only a
number of things that can be done. You can provide
your social protections, safety net s, and that is what
we do through Financial Assistance. We can explore
Bermuda Senate the cost of living, but that is a very difficult measure.
Or, we can say that, in certain circums tances, the
wages which individuals receive are not acceptable,
based on the cost of living in society.
We then used another set of evidence, which
was the 2015 employment survey [Labour Force Sur-vey], and we looked at the number of jobs with annual
incom es less than $35,991. And that is roughly
around $17 per hour on a 40- hour workweek. The m ajority of jobs that fell underneath that measure were,
number one, cooks, cashiers, waiters and waitresses, and sales clerks within the retail stores. And then,
there were a number of other job categories. But in
each of those job categories there were roughly
around 500 jobs that fell beneath that particular threshold.
That is important, because we can now clearly
identify which industries will be impacted most. There
is this notion that if you increase the minimum wage
rate, then it would have an adverse effect on emplo yment. But I believe you have to look at the territory
that you are in and the requirements for that job.
The reports . . . none of the reports thus far
are actually conclusive. There are studies in favour,
and there are studies that are not in favour. But what
there is no debate on is whether or not persons
should be making low, unacceptable wages. See, when we focus on the pure economic argument, we
fail to realise that there are a portion of workers in our community who are protected from low wage rates,
and those are unionised workers. There are over
9,000 unionised workers in Bermuda. And I would
venture to say that all of those workers receive in their
compensation package what we would consider to be
above a living wage or a minimum wage rate. And
each year, we negotiate higher increases for those
workers.
But what I have not found is where there is a
trade- off between that higher wage rate that we neg otiate and employers reducing their workforce. I do not
find that correlation to exist. And so, if it is, if it will
happen, it may be a minimal impact, may have a mi nimal impact on the overall economy. And that is why it
is also important that we j ust approve a National
Workforce Development Plan and we ensure that we have options for persons who may be disadvantaged. Retrain them so that they can work in jobs and receive
a proper wage so they would have to rely on a minimum wage or a statutorily set living wage rate.
A wage commission is actually the most reasonable way forward. What we wanted to avoid from a
committee level is the ability for politicians to arbitrarily put in place minimum and living wage rates. There is
somewhat of a science behi nd it. Whatever methodology that a jurisdiction chooses will be the methodol ogy that you will use perpetually, going forward. So, the
only things that change are the inputs in the methodology, and not the methodology itself. Certainly, you
can have revisio ns to your methodology. But if you have a consistent way of calculating minimum and
living wages, it reduces the amount of opposition you
will get to the actual numbers. And it is a more objective way of doing things, rather than a subjective way.
But the ILO, in its minimum wage policy guide,
actually supports that any statutory system use a tr ipartite model, a commission model in which you have
representatives of the employers, representatives of
the employees and representatives of the gover nment. They will come together. They will look at all the
data. They will have those conversations in terms of the pros and cons of the options that they may put
forward. And then, they will come to a position where
they will recommend a rate to the Minister in a report.
That is the most sensible way of doing things.
And so, I am glad that the Government has not moved
directly forward in putting a minimum or living wage rate in front of us and that they put a mechanism in
place, so what we can do is develop what are t he best
and most appropriate rates for our community, based on the conditions that currently exist in our economy
for this specific period of time.
What my colleagues, some colleagues, stated
earlier in terms of exploitation and the way in which
employees are abused, is a reality. I would have spoken about the way in which non- Bermudian workers in
particular are treated. And they, many come to Bermuda under one auspice, [only] to find out that the conditions that they accept once they get to Bermuda
are very much different than what they thought. And
often, persons will have to work for very low wages,
long hours, with no overtime [pay], no real vacation, no sick leave, even though these are provisions within
our Employment Act. And persons do not speak up
because they fear that if they do, their employment
contract will be severed.
This is the reality. And so, if we can put matters in place which level the playing field and create a
standard across the board, at least for the wage por-tion of the concerns, I think we will be doing everyone
in Bermuda a bit of justice. And I wish that everybody
should be in a dignified work environment. Decent
work should be afforded to all. Nobody should be
working in precarious working conditions.
I believe that the Wage C ommission will come
to a reasonable level. When the Joint Select Commi ttee was mulling over what would be a minimum wage,
we got to somewhere around $12.25 as being reasonable. We already had somewhat of a benchmark
regarding a minimum wage for domestic workers, the
only group of workers who do have a prescribed mi nimum wage, and that is currently at $10.00 an hour.
And so, I do not think what we will find is the
commission setting an unreasonable wage that cr eates an undue burden on business. But while we remain concerned about business interests, our priority of concern should be the workers, the people who work nine- to-five, day after day, and cannot make
ends meet.
634 29 July 2019 Official Hansard Report
Bermuda Senate There is a category of workers on financial
assistance, and those are called low -wage e arners.
And they qualify as being in the low -wage earners
category after the department takes into consideration
what they make, based on their full -time jobs and
what the reasonable expenses are. The list in the
document for a living wage is not exhaustiv e. Different
families will have different factors in terms of what
comprises what is required for their living wage calc ulation. But what we need to do is have a suite of things done to ease the burden of living for persons in Bermuda. Taxation, progressiv e taxation is one. More
intervention into the markets regarding the cost of li ving commission is another. Working to ensure that we have some sort of health care system that is afforda-ble and accessible, increased intervention regarding
the rate of rents i n this country . . . and so, there are a
number of things that we have to do so that persons working have decent lives in Bermuda.
But this is an absolutely necessary first step. It
is the best practiced step in terms of moving forward.
And this will . . . the results of the commission will u ndoubtedly have a positive effect on the lives of many workers in this country. And so, with that, Madam
President, I will conclude.
And I would like to move that the Employment
(Wage Commission) Act 2019 be now read a second
time.
The President: Is there any objection to that motion?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I would like
to suspend Standing Order 26 in relation to this Bill.
The President: Is there any ob jection to that motion?
No objection.
Carry on.
[Motion carried: Standing Order 26 suspended.]
Sen. Jason Hayward: Madam President, I now move
that the Employment (Wage Commission) Act 2019
be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
BILL
THIRD READING
EMPLOYMENT (WAGE COMMISSION) ACT 2019
Sen. Vance Campbell: With there being none, Ma dam President, I move that this Bill do now pass. The President: It has been moved that the Bill ent itled the Employment (Wage Commission) Act 2019 do
now pass.
Is there any objection to that motion?
No objection. The Bill is passed.
[Motion carried: The Employment (Wage Commission)
Act 2019 was given a third reading and passed.]
The President: Thank you, Senator Hayward.
And, Senators, it is 12:30. We will break for
lunch. And we will resume at 2:15.
Thank you all.
Proceedings suspended at 12:3 3 pm
Proceedings resumed at 2:17 pm
[Sen. the Hon. Joan E. Dillas -Wright, President, pr esiding]
The President: Good afternoon, Senators. I hope you
enjoyed your lunch. And for the listening public, we are continuing with the Senate, the Orders of the Day.
And the next Order of the Day is the second
reading of the Dental Practitioners Amendment (No. 2) Act 2019.
And, Senator Hayward, this is your Bill. You
have the floor.
Sen. Jason Hayward: Madam President, I move that
the Bill entitled the Dental Practitioners Amendment
(No. 2) Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Hayward.
BILL
SECOND READING
DENTAL PRACTITIONERS
AMENDMENT (NO. 2) ACT 2019
Sen. Jason Hayward: Madam President, today I pr esent the Bill entitled the
Dental Practitioners Amendment (No. 2) Act 2019 .
Madam President , the Minist ry of Health is
responsible for the legislation that provides the
framework for the regulation of health care professionals. The Dental Practitioners Act of 1950 [the Act]
is the legislation that establishes the Bermuda Dental Board [the Board] and the Dental Professions Complaints Committee, and guides the regulations of dentists, dental hygienists and dental technicians.
The Board is the regulatory Authority charged
with ensuring high standards of professional competence and conduct for the dental profession and to
Bermuda Senate advise the Ministry on iss ues pertaining to them. A ccordingly, the Board’s and the Ministry’s efforts to advance standards for professional practise are ongoing.
The committee is responsible for receiving and investigating complaints against any dentist, dental hygien-ist or dental technician registered with the Board in
order to determine whether a complaint should be r eferred to the Board for possible disciplinary action.
Madam President , the Bill entitled the Dental
Practitioners Amendment (No. 2) Act 2019 proposes
to improve the administrative handling of complaints made against dentists, dental hygienists and dental
technicians by increasing the number of alternate
members available for both the Board and the committee.
Additionally, the Bill proposes a provision for
an auxil iary committee to be constituted when the
committee is unable to deal with all of the complaints
before it. It is important to note that the reasons for
constituting an auxiliary committee can be due to the
volume of complaints received, time constraints and conflicts of interest. The proposed amendments for
auxiliary committees make provisions for decisions of
such committees to be decisions of the committee.
Madam President , currently the Act allows for
seven members of the Board, with one alternate eac h.
It also provides for the committee to be comprised of three members and three alternates. This number of
alternates has proved unworkable due to the intensity
of work involved in investigating complaints and conducting disciplinary hearings.
Madam President , both the Board and the
committee comprise members with full -time commi tments within their respective professions, and secur-ing their engagement for complaints is unreasonably
onerous and unworkable. On average, the committee
receives about three complaints per year. Each complaint is investigated in order to determine whether an
allegation sets out grounds for disciplinary action. The
investigation of a complaint can be a lengthy process
and require intensive consultation, coordination and
research. It is also important to note that during an
investigation, committee members are coordinating
and balancing their professional and personal sche dules in order to ensure a thorough investigation.
Madam President , in our small community,
persons are often conflicted, and establishing a committee that can meet the particulars of a complaint is
challenging with the current membership structure.
The changes proposed today are small, but necessary
to improve the timeliness and efficiency of complaint
handling for both the person making the complaint as
well as the registered person who is the subject of the
complaint.
Overall, Madam President , the Bill entitled the
Dental Practitioners Amendment (No. 2) Act 2019 will
improve complaint handling so that the Boar d and the
committee can continue to uphold the high standards of professional competence and conduct essential
services and safeguarding of the public health.
Thank you, Madam President.
The President: Thank you, Senator Hayward.
Would any other Senator care to speak on the
Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam Pres ident.
This Bill effectively looks to mimic what was
done with the Medical Practitioners Act, and we do not
have any further comments beyond those r aised at
that time.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Hayward, over to you.
Sen. Jason Hayward: Madam President, I now move
that the Dental Practitioners Amendment (No. 2) Act
2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I move to
suspend Standing Order 26 in relation to this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
Sen. Jason Hayward: Madam President, I now move
that the Dental Practitioners Amendment (No. 2) Act
2019 be now read a third time.
The P resident: Is there any objection to that motion?
No objection.
BILL
THIRD READING
DENTAL PRACTITIONERS
AMENDMENT (NO. 2) ACT 2019
Sen. Jason Hayward: Madam President, there being
no objection, I move that the Bill do now pass.
The President: It has been moved that the Bill ent itled the Dental Practitioners Amendment (No. 2) Act
2019 do now pass.
636 29 July 2019 Official Hansard Report
Bermuda Senate Is there any objection to that motion?
No objection.
The Bill is passed.
[Motion carried: The Dental Practitioners Amendment
(No. 2) Act 2019 was given a third reading and passed.]
The President: Thank you, Senator Hayward.
[Order] (5) [under] the Orders of the Day is the
consideration of the draft Regulations entitled the
Merchant Shipping (Fees) Amendment Regulations
2019.
And Senator Caesar, I believe this is your Bill.
Sen. Crystal Caesar: Yes.
The President: You have the floor.
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I move that the Senate do
now take under consideration the draft Regulations
entitled the Merchant Shippi ng (Fees) Amendment
Regulations 2019.
The President: Is there any objection to that motion?
No objection, Senator Caesar.
REGULATIONS
MERCHANT SHIPPING (FEES)
AMENDMENT REGULATIONS 2019
Sen. Crystal Caesar:
Madam President, the purpose
of the amendment regulations before the Senate t oday is to implement a new scale of charges for the
registration of ships with the Bermuda Ship Registry,
to introduce regis tration incentive programmes and to
provide the appropriate powers for the Bermuda Shi pping and Maritime Authority (or BSMA) to reduce or waive fees under certain specific circumstances.
Madam President, Bermuda is a member of
Red Ensign Group (or REG), c ategory 1 shipping registries, and is privileged to register ships of any type,
age or size. The registry must ensure ships on its register comply with Bermuda’s international obligations.
In order to maintain the required standards, the BSMA
must undertak e regular technical surveys, audits and
safety inspections of registered ships, and issue stat utory certificates. Shipowners are required to pay a registration fee, annual tonnage and service fees, and additional fees are levied for certain technical services.
Madam President, the ship registration is a
lucrative and competitive international business. And
shipowners have many options available when considering a jurisdiction to register their ships. Therefore, competing international ship registries have introduced various incentive programmes as a method of encouraging shipowners to register their ships with
the respective registry’s jurisdiction. To enhance Bermuda’s commercial competitiveness and to support
marketing efforts to grow the ship registry, the BSMA
is proposing to implement a new scale of fees for the
one-off initial registration of vessels joining the registry
and introduce an incentive programme. The details of
the proposed programmes are as follows:
• New scale of fees for initial registrat ion of new
vessels, a one- off fee, which is a discount of
30 per cent off the initial registration fee will
be available in the following circumstances:
1. registration of a vessel that is five years of
age or less from the date of first construction or that has undergone a major conversion within the past five years;
2. registration of three or more vessels at
the same time that are 15 years of age or
less, or at least an irrevocable written
commitment to register three or more such vessels within a calendar year;
3. This discount will be increased to 50 per
cent for an owner registering 10 or more vessels that are 15 years of age or less at
the time [of] submitting an irrevocable
written commitment to register 10 or more
such vessels within a calendar year.
Maritim e incentive programme. C urrently,
there are a number of shipping companies that are
registered Bermuda companies, but their ships are
registered in other jurisdictions. It is proposed to pr ovide a reduction in the initial registration fees for ow ners who h ave their shipping company based in Bermuda and who register their ships with the Bermuda
Ship Registry. A similar reduction in the initial registr ation fees can be provided for shipping companies that
comply with the economic substance requirements
once t he scope of adequate requirements is finalised.
Madam President, it has become custom and
standard practice for open shipping registries to waive or reduce fees and the cost of services for specific shipowners and clients as a form of incentive to attract new business, particularly with ships that are under
construction. It is often the case where open ship re gistries will negotiate and enter into agreements with
shipbuilders in Korea, Japan, Italy, Germany and China to provide a ship registration financial package,
which the shipbuilder in turn markets and offers to
owners and financiers to secure construction orders.
Therefore, it is proposed to provide the BSMA the appropriate powers to waive or reduce fees for the new
construction vessels and with the registration of a fleet
of vessels and in other specific circumstances.
Madam President, other amendments to the
regulations include provisions for the issuance of spe-cific insurance certificates as a result of recent
amendments to the enabling legislation to the Merchant Shipping Act 2002, and provisions for the iss uBermuda Senate ance of ship radio licences. Thank you, Madam Pres ident.
The President: Thank you, Senator Caesar.
Would any Senator care to speak on these
[draft regulations]?
Senator Jardine, you have the floor.
Sen. James S. Jardine: Thank you, Madam Pres ident.
I just had one question for the Senator. I do
not know if you can answer this. I mean, I know that
the Shipping Authority, one of the reasons (and you
say it in your statements) was to create or i ncrease
our shipping register. And do you have, or does the
Ministry have any idea what revenues, additional revenues they are hoping to generate as a result of this
change? Or will, in fact, revenues be reduced? I see it
as a revenue- generation exercise, and I just wo ndered if they had any sort of thoughts as to what they
thought they could bring in by way of additional rev enue.
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
these [draft regulations]?
No? Then, Senat or Caesar, you have one
question.
Sen. Crystal Caesar: Yes. Thank you, Madam Pres ident. If you just bear with me, I am going to see . . .
my technical people are listening in, and see if they
can provide an answer for that.
[Laughter]
Sen. Crystal Caesar: If not, I will have to take it under
advisement and give you the answer later.
Sen. James S. Jardine: That is fine. That is fine,
Madam President.
The President
You can take it under advisement. Sen. Crystal Caesar: Okay. Thank you. The President : Thank you, Senator Caesar. Sen. Crystal Caesar: Thank you. Madam President, I move that the said draft regulations be approved, and that the following message be sent to His Excellency, the Governor: May it please …
You can take it under advisement.
Sen. Crystal Caesar: Okay. Thank you.
The President : Thank you, Senator Caesar.
Sen. Crystal Caesar: Thank you.
Madam President, I move that the said draft
regulations be approved, and that the following message be sent to His Excellency, the Governor:
May it please your Excellency, the Senate,
having h ad under consideration the draft Regulations
entitled the Merchant Shipping (Fees) Amendment Regulations 2019, proposed to be made by the Mini ster responsible for maritime administration under the
provisions of section 250 of the Merchant Shipping
Act 2002, has the honour to inform your Excellency that the Senate has approved the said draft regul ations.
The President: Thank you, Senator Caesar.
Is that any objection to that message?
No. Then, thank you, Senator Caesar. A sui table message will be sent to the Governor as indicated.
[Motion carried: The Merchant Shipping (Fees)
Amendment Regulations 2019 were approved.]
The President: Moving on now to the next item on
the agenda, which is [Order] number (6), consider ation of the draft Order entitled the Pensions (War Ser-vice) Order 2019.
And Senator Caesar, I believe this is your O rder, as well.
Sen. Crystal Caesar: Yes, it is, Madam President.
The President: You have the floor.
SUSPENSION OF STANDING ORDER 71(2)
Sen. Crystal Caesar: Thank you.
Madam President, I move that Standing Order
71(2) be suspended so that Senate may now proceed with consideration of the draft regulation Order notice
rules entitled the Pensions (War Service) Order 2019.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Caesar.
[Motion carried: Standing Order 71(2) suspended.]
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I move that the Senate do
now take under consideration the draft Order entitled
the Pensions (War Service) Order 2019.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Caesar.
ORDER
PENSIONS (WAR SERVICE) ORDER 2019
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I am pleased to present th e
Pensions (War Service) Order 2019 for Member s of
the Senate to consider. The purpose of this Order is to prescribe the rate of pensions for war veterans in accordance with section 16A of the
Pensions and Gr atuities War Service Act 1947 .
Madam President , Member s will be aware
that qualifying war veterans are afforded a monthly
638 29 July 2019 Official Hansard Report
Bermuda Senate pension payment administered by the Department of
Social Insurance. This Order seeks to increase the
payment by $200, from $800 to $1,000 per month.
Madam President , the cost of this increase to
the Government is approximately $162,000 in fiscal year 2019/20. A partial budgetary provision has a lready been made within the budget allocation for the
War Vets programme administered by the Department
of Social Insurance. The additional cost will be funded
from savi ngs from within the current Ministry of F inance budget allocation.
Madam President , to be clear, in addition to
the pension benefit, war veterans also receive various
medical benefits which include: all expenses for
treatment at the King Edward Memorial H ospital
[KEMH], including vision care, unlimited prescription
drugs, medical office visits to general practitioners
[GPs] and specialists, and limited denture [coverage];
also funeral expenses up to $5,000 are also covered
under the Act.
Madam President , war veterans enrolled in
the Government’s war veteran’s pension scheme are
afforded the benefits of FutureCare insurance plus
additional benefits only available on the basis of their
status as a war veteran.
All expenses for hospitalisation and tests at
the KEMH, inclusive of vision care at KEMH, are fully
covered.
Medical and surgical services received overseas are covered at 75 per cent under FutureCare
with the balance being covered under the War Veterans Insurance programme at the discretion of the War
Pension Commissioners.
Prescription drugs are covered at 80 per cent
up to a maximum of $2,000 under FutureCare. Once
that $2,000 is reached the cost of the prescriptions
are covered in accordance with the War Veterans
Benefit Schedule.
Madam President , under FutureCare medical
visits to a GP are paid at $46 per visit. Visits to specialists are covered at $131 per initial visit and $55 for
follow -ups. War veterans receive additional coverage
of up to $128 to cover the balance of a specialist follow-up visit s.
Basic dental care is provided under F utureCare and additional benefits of up to $1,000 per annum for dentures is afforded to war veterans.
Madam President , long- term care at the extended care unit and at the palliative respite care is covered for war veterans up to $7,000. There is also
provision for coverage up to $5,000 for funeral expenses.
New benefits of FutureCare available to war
veterans include: partial coverage of psychotherapy
sessions; visits to clinic psychologists, psychiatrists
and chiropodists. Full benefit information for war vet-erans can be obtained from the Department of Social
Insurance. Madam President , in an earlier statement
covered in another House on this matter, in reference
to Bermuda soldiers, those who served as essential
support staff in Italy and Egypt during the First World
War are covered. This reference should have been made to World War II. Additionally, the statement erroneously suggested (in another place) that soldiers
with families were not allowed to serve . . . sorr y, that
all soldiers with families were not allowed to serve
overseas. In fact, only those soldiers who were the
sole remaining sons of a widow remained on Island as the Government did not wish to [unduly] burden the
dependants.
Madam President, Bermuda’s war veterans
are only a small number in our community, but their stories are a voluminous chapter in Bermuda’s history.
The Minister and the Ministry will continue to take ev ery opportunity to support the widows and their families
for their service.
We wou ld also like to thank the Honourable
Member Mr. Derrick Burgess JP, MP, and Ms. Carol
Everson MBE, LRAM, welfare casemaker with the
Bermuda Legion. Ms. Everson was at the forefront of
veterans’ affairs for several years. And both of the
individuals have wo rked tirelessly to ensure that the
stories of war veterans continue to be told and their
rights and earned privileges upheld. Without their t enacity in this matter, these benefits would not have
been realised and they are to be lauded for their efforts.
Madam President , with these brief remarks I
welcome discussion by my honourable colleagues .
The President: Thank you, Senator Caesar.
Would any Senator care to speak on this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam P resident.
Certainly, people in my generation have not
had to live through a time where our country has been
involved in an active war, in a sense. And a lot of the
stability that countries in the North Atlantic have benefited through over the last 50- plus years has been because of the sacrifices made by those during the two
World Wars. And, certainly, we think this is right that it
be aligned with other pension increases that have
been passed. Thank you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No? Then, Senator Caesar, it is over to you.
Sen. Crystal Caesar: Thank you, Madam President.
I move that the said draft Order be approved
and that the following message be sent to His Excellency, the Govern or:
Bermuda Senate May it please your Excellency, the Senate,
having had under consideration the draft Order ent itled the Pensions (War Service) Order 2019, pr oposed to be made by the Minister responsible for defence under the provisions of section 16A of the Pensions and Gratuities (War Service) Act 1947, has the
honour to inform your Excellency that the Senate has
approved the said draft Order.
The President: Is that any objection to that motion?
No objection.
Senator Caesar, a suitable message will be
sent, and thank you.
Sen. Crystal Caesar: Thank you, Madam President.
[Motion carried: The Pensions (War Service) Order
2019 w as approved.]
The President: The next few are Senator Campbell.
We will have to wait until he comes.
[Inaudible interjection]
The Presi dent: We will proceed now with item number 7 on our agenda, which is —
[Crosstalk ]
The President: Oh, the last one. Okay.
We will proceed then with [ Order number
(11),] the second reading of the Chartered Professional Accountants Amendment Act 2019.
[Crosstalk]
The President: Well, Senator Hayward is . . .
[Inaudible interjections]
The President: He is going to be very quick.
Sen. Crystal Caesar: Okay. Thank you.
The President : Thank you, Senator Caesar.
Sen. Crystal Caesar: Thank you.
Madam President, I move that the said draft
regulations be approved, and that the following message be sent to His Excellency, the Governor:
May it please your Excellency, the Senate,
having h ad under consideration the draft Regulations
entitled the Merchant Shipping (Fees) Amendment Regulations 2019, proposed to be made by the Mini ster responsible for maritime administration under the
provisions of section 250 of the Merchant Shipping
Act 2002, has the honour to inform your Excellency that the Senate has approved the said draft regul ations.
The President: Thank you, Senator Caesar.
Is that any objection to that message?
No. Then, thank you, Senator Caesar. A sui table message will be sent to the Governor as indicated.
[Motion carried: The Merchant Shipping (Fees)
Amendment Regulations 2019 were approved.]
The President: Moving on now to the next item on
the agenda, which is [Order] number (6), consider ation of the draft Order entitled the Pensions (War Ser-vice) Order 2019.
And Senator Caesar, I believe this is your O rder, as well.
Sen. Crystal Caesar: Yes, it is, Madam President.
The President: You have the floor.
SUSPENSION OF STANDING ORDER 71(2)
Sen. Crystal Caesar: Thank you.
Madam President, I move that Standing Order
71(2) be suspended so that Senate may now proceed with consideration of the draft regulation Order notice
rules entitled the Pensions (War Service) Order 2019.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Caesar.
[Motion carried: Standing Order 71(2) suspended.]
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I move that the Senate do
now take under consideration the draft Order entitled
the Pensions (War Service) Order 2019.
The President: Is there any objection to that motion?
No objection.
Carry on, Senator Caesar.
ORDER
PENSIONS (WAR SERVICE) ORDER 2019
Sen. Crystal Caesar: Thank you, Madam President.
Madam President, I am pleased to present th e
Pensions (War Service) Order 2019 for Member s of
the Senate to consider. The purpose of this Order is to prescribe the rate of pensions for war veterans in accordance with section 16A of the
Pensions and Gr atuities War Service Act 1947 .
Madam President , Member s will be aware
that qualifying war veterans are afforded a monthly
638 29 July 2019 Official Hansard Report
Bermuda Senate pension payment administered by the Department of
Social Insurance. This Order seeks to increase the
payment by $200, from $800 to $1,000 per month.
Madam President , the cost of this increase to
the Government is approximately $162,000 in fiscal year 2019/20. A partial budgetary provision has a lready been made within the budget allocation for the
War Vets programme administered by the Department
of Social Insurance. The additional cost will be funded
from savi ngs from within the current Ministry of F inance budget allocation.
Madam President , to be clear, in addition to
the pension benefit, war veterans also receive various
medical benefits which include: all expenses for
treatment at the King Edward Memorial H ospital
[KEMH], including vision care, unlimited prescription
drugs, medical office visits to general practitioners
[GPs] and specialists, and limited denture [coverage];
also funeral expenses up to $5,000 are also covered
under the Act.
Madam President , war veterans enrolled in
the Government’s war veteran’s pension scheme are
afforded the benefits of FutureCare insurance plus
additional benefits only available on the basis of their
status as a war veteran.
All expenses for hospitalisation and tests at
the KEMH, inclusive of vision care at KEMH, are fully
covered.
Medical and surgical services received overseas are covered at 75 per cent under FutureCare
with the balance being covered under the War Veterans Insurance programme at the discretion of the War
Pension Commissioners.
Prescription drugs are covered at 80 per cent
up to a maximum of $2,000 under FutureCare. Once
that $2,000 is reached the cost of the prescriptions
are covered in accordance with the War Veterans
Benefit Schedule.
Madam President , under FutureCare medical
visits to a GP are paid at $46 per visit. Visits to specialists are covered at $131 per initial visit and $55 for
follow -ups. War veterans receive additional coverage
of up to $128 to cover the balance of a specialist follow-up visit s.
Basic dental care is provided under F utureCare and additional benefits of up to $1,000 per annum for dentures is afforded to war veterans.
Madam President , long- term care at the extended care unit and at the palliative respite care is covered for war veterans up to $7,000. There is also
provision for coverage up to $5,000 for funeral expenses.
New benefits of FutureCare available to war
veterans include: partial coverage of psychotherapy
sessions; visits to clinic psychologists, psychiatrists
and chiropodists. Full benefit information for war vet-erans can be obtained from the Department of Social
Insurance. Madam President , in an earlier statement
covered in another House on this matter, in reference
to Bermuda soldiers, those who served as essential
support staff in Italy and Egypt during the First World
War are covered. This reference should have been made to World War II. Additionally, the statement erroneously suggested (in another place) that soldiers
with families were not allowed to serve . . . sorr y, that
all soldiers with families were not allowed to serve
overseas. In fact, only those soldiers who were the
sole remaining sons of a widow remained on Island as the Government did not wish to [unduly] burden the
dependants.
Madam President, Bermuda’s war veterans
are only a small number in our community, but their stories are a voluminous chapter in Bermuda’s history.
The Minister and the Ministry will continue to take ev ery opportunity to support the widows and their families
for their service.
We wou ld also like to thank the Honourable
Member Mr. Derrick Burgess JP, MP, and Ms. Carol
Everson MBE, LRAM, welfare casemaker with the
Bermuda Legion. Ms. Everson was at the forefront of
veterans’ affairs for several years. And both of the
individuals have wo rked tirelessly to ensure that the
stories of war veterans continue to be told and their
rights and earned privileges upheld. Without their t enacity in this matter, these benefits would not have
been realised and they are to be lauded for their efforts.
Madam President , with these brief remarks I
welcome discussion by my honourable colleagues .
The President: Thank you, Senator Caesar.
Would any Senator care to speak on this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kempe: Thank you, Madam P resident.
Certainly, people in my generation have not
had to live through a time where our country has been
involved in an active war, in a sense. And a lot of the
stability that countries in the North Atlantic have benefited through over the last 50- plus years has been because of the sacrifices made by those during the two
World Wars. And, certainly, we think this is right that it
be aligned with other pension increases that have
been passed. Thank you.
The President: Thank you, Senator Kempe.
Would any other Senator care to speak on
this Bill?
No? Then, Senator Caesar, it is over to you.
Sen. Crystal Caesar: Thank you, Madam President.
I move that the said draft Order be approved
and that the following message be sent to His Excellency, the Govern or:
Bermuda Senate May it please your Excellency, the Senate,
having had under consideration the draft Order ent itled the Pensions (War Service) Order 2019, pr oposed to be made by the Minister responsible for defence under the provisions of section 16A of the Pensions and Gratuities (War Service) Act 1947, has the
honour to inform your Excellency that the Senate has
approved the said draft Order.
The President: Is that any objection to that motion?
No objection.
Senator Caesar, a suitable message will be
sent, and thank you.
Sen. Crystal Caesar: Thank you, Madam President.
[Motion carried: The Pensions (War Service) Order
2019 w as approved.]
The President: The next few are Senator Campbell.
We will have to wait until he comes.
[Inaudible interjection]
The Presi dent: We will proceed now with item number 7 on our agenda, which is —
[Crosstalk ]
The President: Oh, the last one. Okay.
We will proceed then with [ Order number
(11),] the second reading of the Chartered Professional Accountants Amendment Act 2019.
[Crosstalk]
The President: Well, Senator Hayward is . . .
[Inaudible interjections]
The President: He is going to be very quick.
An Hon. Member An Hon. Member
Yes. The President: We are doing item number 11 on the agenda. Senator Hayward, it is your Bill. STANDING ORDER 25 Sen. Jason Hayward: Madam President, I move that the provision of Standing Order 25 be granted so that the Senate may now proceed with the second reading of the …
Yes.
The President: We are doing item number 11 on the
agenda.
Senator Hayward, it is your Bill.
STANDING ORDER 25
Sen. Jason Hayward: Madam President, I move that
the provision of Standing Order 25 be granted so that the Senate may now proceed with the second reading
of the Bill entitled the Chartered Professional A ccountants Amendment Act 2019.
The Presi dent: Is there any objection to that motion?
No objection.
Carry on, Senator Hayward. [Motion carried: Leave granted for the Chartered Pr ofessional Accountants Amendment Act 2019 to be
read a second time on the same day as its first reading.]
Sen. Jason Hayward: Madam President, I now move
that the Bill entitled the Chartered Professional A ccountants Amendment Act 2019 be now read a sec-ond time.
The President: Is there any objection to the second
reading?
No.
Carry on, Senator Hayward.
BILL
SECOND R EADING
CHARTERED PROFESSIONAL ACCOUNTANTS
AMENDMENT ACT 2019
Sen. Jason Hayward: Madam President, today I i ntroduce the Bill entitled the
Chartered Professional
Accountants Amendment Act 2019 .
Madam President, in summary, this Bill makes
amendments to sections 9 and 10 of the Chartered
Professional Accountants Act 1973 to provide for the
statutory recognition of the designation “Association of Chartered Certified Accountants,” which is known i nternationally by the initials ACCA. This statutory
recognition of the designation, ACC A, will enable
members of CPA Bermuda who qualify to hold the
designation, to now have the right to use the designation in Bermuda.
Madam President, CPA Bermuda is directly
affiliated with the Chartered Professional Accountants of Canada (or CPA Canada). I ts mission is to foster
public confidence in the accountant profession by ac ting in the public interest and helping its members excel. The key objectives of CPA Bermuda are to pr omote and increase the knowledge, skill, and proficie ncy of its members and st udents; to regulate the disc ipline and professional conduct of its members and
students; to promote the best standards of practice in financial reporting; and to promote the welfare and
interests of CPA Bermuda and the accountant profession.
The Chartered Professional Accountants Act
1973 and its bylaws govern the standards of oper ations upon which CPA Bermuda functions.
Madam President , the amendments to the
CPA Bermuda Act 1973 will allow for the first time persons resident in Bermuda who hold the Assoc iation of Chartered Certified Accountants [ACCA ] designation to become members of CPA Bermuda. As a result, persons holding the ACCA designation will then
be able to practice in Bermuda with the same rights
640 29 July 2019 Official Hansard Report
Bermuda Senate and privileges as any other professional accountant
currently recognised in Bermuda.
Madam President , as a backdrop, ACCA Caribbean has been engaged in discussions with key
stakeholders in Bermuda since 2009, primarily to ad-dress recognition issues and to promote ACCA qual ifications as a viable and alternative career pathway to
becoming a chartered accountant. In 2012, Bermuda
College, through its division of Professional and C areer Education (PACE), began offering the ACCA qualification and became a licensed computer -based
testing centre for ACCA examinations.
Madam President , the ACCA Certified A ccountant Technician [ CAT] programme was deemed
to be attractive for our two public senior schools. There was an [ interest ] in incorporating the programme into the senior school curriculum as an option under th e Career Pathways programme. However, the
lack of market recognition of the ACCA accountant
qualification was a significant drawback.
Madam President , unlike many of the other
accounting designations, students do not need a
bachelor’s degree to enrol in A CCA programmes.
They can [attend] the ACCA programme and earn
their bachelor’s and master’s degrees as they pr ogress through the coursework with three years of rel evant work experience.
Therefore, Madam President , with a high
number of non- Bermudian accountants on work permits on the Island, the ACCA accounting designation
provides an avenue for Bermudians to earn an inter-nationally recognised professional accounting desi gnation without having to leave the Island to earn a
bachelor’s degree.
Madam Preside nt, the ACCA qualification upholds the global accounting education standards set
by the International Federation of Accountants and the
qualification has been officially benchmarked to the
master’s degree level by Oxford Brookes University in
the United Ki ngdom. After several years of advocacy
and dialogue with a number of Government Ministers
and officials promoting the values and benefits of the
ACCA qualification, in 2018, CPA Bermuda agreed to support the amendment of the Act so that ACCA
members could become members of CPA Bermuda,
having the same rights to practice in Bermuda as ot her chartered accountants.
Madam President , the amendments to the
CPA Bermuda Act and the subsequent bylaws by
negative resolution will recognise all qualified accountants w hose designations are listed in the new
scheduled section 9(3) under clause 2 of the Bill on an
equal footing. The amended Act will also introduce
competition in the market, thus facilitating choice, dri ving standards and ultimately growing the economy.
The amendment will allow for the Act and the bylaws
to take into account those accountants entering into
Bermuda on a temporary basis, thus strengthening the regulatory arm of the accountant profession and
protecting the public.
Thank you, Madam President .
The President: Thank you, Senator Hayward.
Would any Senator care to speak on this Bill?
No . . . Oh, Senator Richardson, you have the
floor.
Sen. Anthony Richardson: Madam President, [I
have] very few brief comments. I think I know that
around the tab le the intended change will impact the
professional body for at least 1, 2, 3, 4 of us that sit
around the table. And I just want to, I guess, further
emphasise the impact of what has been done today.
As you know, we are all members of the
community and once it was known that this was going to be coming to this table for a discussion and debate,
others have actually said to me that this a good thing
for us because there are many persons who were in
Bermuda previously that did qualify under the ACCA
guideli nes and were not able to really fully practice in
Bermuda.
By way of brief history, Bermuda has always
had a very strong demand for accountants. And I know, probably around 2002 (give or take) even the
government had some challenges in finding staff. I
was part of the process whereby we actually went to
broaden our catch (if that is the right way to put it) and
went to the Caribbean, and we were able to identify
several qualified professionals to come to Bermuda
and some of them are still here. And so now t hey will
be able to have a better opportunity to practice as pr ofessional accountants as we move forward.
And as Senator Hayward mentioned, I was
pleasantly surprised in preparing for today’s discussion to contact CPA Bermuda and to understand that
one of the advantages of this legislation is that now
there will be one body that actually is able to govern all persons who qualify or practice as accountants,
which will have a positive impact on the AML/ATF
guidelines. And so going forward it will be easier for
Bermuda to manage all those persons who identify
themselves as accountants.
And for the general public to understand that,
to put myself, or to put yourself forward as an ac-countant, it does not happen by osmosis. There is a
full process that you have t o go through. And in terms
of those who are purchasing accounting services, it
will be interesting for them to make sure that if the
person is providing professional services, that they should be registered in Bermuda, which means to
come under the CPA gui delines, and that will assist us
overall in ensuring that there is a consistent level of
professionalism as persons provide those services.
Thank you, Madam President.
The President: Thank you, Senator Richardson.
Bermuda Senate ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: I would just like to acknowledge the
presence of the Parliamentary Counsel, Gwen Joh nson, in the Chamber. And welcome to you.
[Chartered Professional Accountants Amendment Act
2019, second reading debate, continuing]
The President: Would any other Senator care to
speak? Oh, Senator Kempe. You have the floor.
Sen. Nicholas Kempe: Yes, thank you, Madam President .
We know the industry has been asking for this
for a while and it has been a long time coming. We
support this legislatio n.
The President: Thank you, Senator Kempe.
Senator Hayward, over to you.
Sen. Jason Hayward: Madam President, I now move
that the Bill entitled the Chartered Professional A ccountants Amendment Act 2019 be now read a second time.
The President: Is the re any objection to that motion?
No objection. Carry on, Senator Hayward.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I now move
that we suspend Standing Order 26 in relation to this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
CHARTERED PROFESSIONAL ACCOUNTANTS
AMENDMENT ACT 2019
Jason Hayward: Madam President, I now move that
the Bill entitled the Chartered Professional Accountants Amendment Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Jason Hayward: Madam President, with no objections, I now move that the Bill do now pass.
The President: It has been moved that t he Bill ent itled the Chartered Professional Accountants Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection. The Bill is passed.
Thank you, Senator Hayward.
[Motion carried: The Chartered Professional Accountants Amendment Act 2019 was given a third reading
and passed.]
The President: We will now go back to our [ Order
number] (7), the second reading of the Corporate Service Provider Business Amendment Act 2019.
Senator Campbell, this is your Bill. You have
the floor.
STANDING ORDER 25
Sen. Vance Campbell: Thank you, Madam President.
Madam President, I move that the provisions
of Standing Order 25 be granted so that the Senate
may now proceed with second reading of the Bill ent itled the Corporate Service Prov ider Business
Amendment Act 2019.
The Clerk: Do the other two titles as well, at the same
time.
Sen. Vance Campbell: [At] the same time?
The President: Mm-hmm.
The Clerk: Yes, do the others.
Sen. Vance Campbell: Also, Madam President, I
move that prov isions of Standing Order 25 be granted
so that the Senate may now proceed with second reading of the Bills entitled the Trusts (Regulation of
Trust Business) Amendment Act 2019 and the Insurance Amendment Act 2019.
The President: Any objection to that mot ion?
No objection.
[Motion carried: Leave granted for the Corporate Service Provider Business Amendment Act 2019, Trusts
(Regulation of Trust Business) Amendment Act 2019 ,
and the Insurance Amendment Act 2019 to be read a
second time on the same day as their first reading.]
Sen. Vance Campbell: Thank you, Madam President.
The President: Carry on, Senator Campbell.
642 29 July 2019 Official Hansard Report
Bermuda Senate BILL
SECOND READING
CORPORATE SERVICE PROVIDER BUSINESS
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, the Government wishes t he Senate now to give consideration
to the Bill entitled Corporate Service Provider Bus iness Amendment Act 2019 , the Act.
The purpose of the proposed amendments to
the Act is to enhance the Bermuda Monetary Author ity’s [BMA] regulation of licensed corporate service
providers [CSP] and to align Bermuda’s regime with evolving international best practice and regulatory
standards for the oversight of corporate service provider businesses.
Madam President , the Ministry of Finance has
been advised by the BMA that the regulatory fram ework for the corporate service provider sector will be
assessed by The Group of International Financial
Centre Supervisors ( GIFCS ) in 2020. Accordingly, key
amendments to the Act are required to further comply
with the GIFCS standard on the regulation of corporate service provider and are as follows:
1. To require licensed corporate service pr oviders to maintain a physical presence in Bermuda. Senators are advised that the
objective of this requirement is to ensure
that the Bermuda Monetary Authority is
capable of exercising the appropriate reg-ulatory influence over corporate service
providers.
2. To remove the fee prescribed for the i nspection of the register of licensed corporate service provider businesses. Sen ators are advised that such a fee is no
longer payable as the list of licensed CSPs is available to the public on the
BMA’s website.
3. To require that the BMA must approve the
surrender of a licence prior to the surrender coming into effect. Senators are advised that this measure is to protect cl ients’ interests and ensure that the corporate service provider business is wound
down or transferred appropriately.
4. To insert a provision requiring client money to be segregated from the licensed
businesses own funds and maintaining
accounting records to readily identify such
client money. Senators are advised that
this measure is intended to avoid the comingling of funds to protect clients’ interests in the event a corporate service pr ovider fails.
5. To add a power for the Authority to ex-empt or modify prudential standards or requirements. Senators are advised that
this provision will allow the BMA to ex-empt a CSP from the necessity to comply
with t he prudential requirement following
an assessment of the CSP's nature and scale. Avoiding a one- size-fits-all a pproach is the cornerstone of the BMA’s
risk-based approach to regulation.
Madam President , the Senate is advised the
BMA has met with members of the corporate service
provider sector to discuss the amendments. In add ition, as per the BMA’s normal custom and practice,
published a consultation paper together in June 2019
to advise industry of the proposed changes. The consultation results were pub lished by the BMA on its
website on the 24
th of July 2019. Madam President ,
there were 94 corporate service providers licensed by the BMA.
With that, Madam President , I conclude my i nitial presentation. Thank you, Madam President .
The President: Thank you, Senator Campbell.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: I would just like to take this opportunity to acknowledge the presence of Elizabeth Copeland from the Policy Department of the BMA.
Welcome to you, Madam.
[Corporate Ser vice Provider Business Amendment Act
2019 , second reading debate, continuing]
The President: Would any Senator care to speak on
this Bill?
Senator Kempe?
Sen. Nicholas Kempe: No.
The President: I’m sorry. I thought you were reaching
for your microphone.
Sen. Nicholas Kempe: No, Madam President, we
understand these are housekeeping from BMA and
we support the progression of these laws.
The President: Thank you.
Would any other Senator care to speak on
this Bill?
No? Then, Senator Campbell, it is ov er to you.
Sen. Vance Campbell: Thank you, Madam President.
And thank you, fellow Senators.
Madam President, I move that the Bill entitled
the Corporate Service Provider Business Amendment
Act 2019, be now read a second time.
Bermuda Senate The President: Is there an y objection to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move to
that Standing Order 26 be suspended in respect of
this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
CORPORATE SERVICE PROVIDER BUSINESS
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Corporate Service Provider Bus iness Amendment Act 2019, be now read a third time.
The President: Is there any objection to the third
reading?
No objection, Senator Campbell.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled t he Corporate Service Provider Business
Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection. The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Corpor ate Service Provider Bus iness Amendment Act 2019 was given a third reading
and passed.]
The President: You will go on now to your —
Sen. Vance Campbell: Next one.
The President: —the next one, the Trusts (Regul ation of Trust Business) Amendment Act 2019.
You have the floor.
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Trusts (Regulation of Trust Bus iness) Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on.
BILL
SECOND READING
TRUSTS (REGULATION OF TRUST BUSINESS)
AMENDMENT ACT 2019
Sen. Vance Campbell: Thank you, Madam President.
Madam President, Government wishes the
Senate now to give consideration to the Bill entitled
the Trusts (Regulation of Trust Business) Amendment
Act 2019 . The purpose of the proposed amendments
to the Trusts (Regulation of Trust Business) Act 2001
is to enhance the Bermuda Monetary Authority’s reg ulation of licensed trust businesses and to align Be rmuda’s regime with evolving international best prac-tice and regulatory standards for the oversight of trust
businesses.
Madam President , the Ministry of Finance has
been advised by the BMA that the regulatory fram ework for the trust sector will be assessed by the G roup
of International Financial Centre Supervi sors (GIFCS)
in 2020. Accordingly, the key amendments to the Act are required to further comply with the GIFCS’s
standard on the regulation of trust service providers
and are as follows (and these are identical to the Bill
that we just dealt with, Madam Pr esident , so I will just
go through them quickly) :
1. To require licensed trust businesses to
maintain a physical presence in Bermuda.
2. To remove the fee prescribed for the i nspection of the register of licensed trust businesses , because they can be found
on th e website .
3. To require that the BMA must approve the surrender of a licence prior to the surrender coming into effect.
4. To insert a provision requiring client money to be segregated from the licensed trust businesses own funds and maintai ning accounting records to readily identify such client money.
5. To add a power for the Authority to make
rules prescribing annual returns and adding a power for the Authority to exempt or modify prudential standards or requir ements.
6. To enhance the minimum criteria for l icensing to impose an obligation to mai ntain adequate liquidity in order to be deemed to be conducting business in a prudent manner.
Madam President , the BMA has met with
members of the Bermuda Association of Licensed Trustees to discuss the amendments. Senat ors are
644 29 July 2019 Official Hansard Report
Bermuda Senate advised that concerns were raised by industry regar ding the proposed amendments to the Act to facilitate
physical presence requirements.
Madam President , the Authority has now determined that they will use a combination of desk -
based reviews, prudential meetings, and onsite visits
to make a determination of the suitability of a trust
business’s ongoing physical presence. Accordingly,
the consultation results were published online by the
BMA on the 24th of July 2019.
Madam President , in addition to the above, as
per the Authority’s normal custom and practice, a consultation paper, together with a draft Bill were published in June 2019 to advise the industry of the proposed changes. Madam President , presently there are
28 licensed trust companies supervised by the BMA.
With that, Madam President , I conclude my i nitial presentation. Thank you, Madam President .
The President: Thank you, Senator Campbell.
Would any Senator care to speak on this Bill?
No. Senator Campbell, it is back over to you.
Sen. Vance Campbell: Thank you, Madam President.
Thank you, Senators, for your support.
Madam President, I move that the Bill entitled
the Trusts (Regulation of Trust Business) Amendment
Act 2019 be now read a second time.
The President: Is there any object ion to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
Standing Order 26 be suspended in respect of the Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
TRUSTS (REGULATION OF TRUST BUSINESS)
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Trusts (Regulation of Trust Bus iness) Amendment Act 2019, be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Trusts (Regulation of T rust Business)
Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Trusts (Regulation of Trust Business) Amendment Act 2019 was given a third reading
and passed.]
The President: We will now move on to [Order] number (9), the second reading of the Insurance Amendment Act 2019.
Sen. Vance Campbell: Madam President, it is me
again.
[Crosstalk]
ANN OUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: While you are getting yourself toget her, can I just acknowledge the presence of the Mini ster of Education, Minister Rabain, who is in the Gallery.
Welcome to you, Minister.
[Insurance Amendment A ct 2019, second reading debate, continuing]
The President: Senator Campbell, you have the floor.
Sen. Vance Campbell: Thank you, Madam President.
I move that the Bill entitled the Insurance
Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
BILL
SECOND READING
INSURANCE AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I am
pleased to present to the Senate the Bill entitled the
Insurance Amendment Act 2019
.
Bermuda Senate This Bill seeks to amend the Insurance Act
1978 by making a number of changes to the Act to
introduce and establish two new classes of limited
purpose insurers and a new category of intermediary,
to be known as “insurance marketplace providers.”
Madam President , the Bermuda Monetary
Authority is, and has always been, committed to the
enhancement of the viability of the Bermuda insurance market. Over the years, the Authority has been
recognised as a centre of excellence f or innovation
and for providing a regulatory environment that appropriately regulates and supervises the insurance
industry , while remaining conducive to product and
technological innovation. It is toward this end that the
Authority proposes to introduce new classes of LPIs, a fully collateralized insurer class to be known as “collateralized insurers,” and an innovation class to be
known as “general business innovative insurers” or
Class IIGB.
Madam President , the collateralized insurance
class will be available to those insurers with complex
collateralized structures as well as insurers with deals
that are not an ideal fit for the existing special purpose
insurer, or other insurance classes ’ regulatory fram eworks.
Madam President , the special purpose insurance [ SPI] framework was established for less complex, limited duration, catastrophe bonds, or similar
transactions. However, Madam President , over time
these structures have grown to include more complex
structures and deals. The collateralized insurer framework is specifically tailored to cater for the innovations and continuing transformation of the insurance link security structures.
Madam President , the Authority in 2018 established an insurance regulatory sandbox and an
insurance innovation hub. There is now a need for a post sandbox innovation class where some of these
companies can graduate into following a successful
testing period. While the existing and proposed clas-ses are still available for the sandbox graduating
companies, as long as they appropriately fit into the
respective class definition, the proposed IIGB class will primarily cater specifically to companies that seek
to utilise digital assets in their insurance operation.
For example, accepting premiums and paying indem-nity coverage in digital assets.
Madam President , the Authority has also no ted growing interest in the establishment of InsurTech-related pl atforms, established for the purpose of bringing insurance buyers and sellers together to buy and sell insurance coverage via auction, or other ar-rangements, or for trading insurance contracts, generally referred to as “insurance marketplace provi ders.” Th is has been noted from the Authority’s engagement with market participants in relation to the
insurance sandbox, and innovation hub- related appl ications and inquiries. The Authority is therefore pr oposing to introduce a new intermediary class to be called “insurance marketplace providers.” Corr espond ingly, a sandbox licence will be introduced for
this new intermediary which will be called “IMPs.”
Madam President , the Authority is proposing
changes to the Act to add these new classes and to enhance the exis ting rules, regulations, and codes
that support and form the regulatory framework for
these new classes. The rules related to regulatory
reporting and capital requirements will be drafted by
the Authority and consulted upon later this year.
Madam President , while the proposed insurer
regimes are being designed to meet the international insurance regulatory standards adopted by the International Association of Insurance Supervisors [the
IAIS], they do not fall within the commercial framework
that are Solvency II equivalent.
Madam President , the proposed regulatory
regime for insurance marketplaces will be similar to
that for insurance agents. A draft code of conduct for
insurance marketplace was published on the 14
th of
May 2019, along with a consultation paper, to address
the additional components of the framework. Madam
President , the Senate is advised that the Authority has
given due consideration to all the feedback prior to
finalisation of the new regulatory regime.
Madam President , the amendments repr esent
a collaborative effort between the Authority and var ious industry stakeholders. I would like to thank all of
those persons within the Bermuda Monetary Authority,
the Attorney General’s Chambers, the Ministry of F inance, and the private sector who hav e assisted with
the development of this Bill.
Madam President, under the present InsurTech framework, the Authority has received six appl ications from insurers and insurance intermediaries, of which three have registered to date. With that, Madam
Preside nt, I now conclude my introductory remarks .
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The President: Would any Senator care to speak on
this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kemp e: Thank you, Madam Pres ident. And thank you, Senator Campbell, for your
summary.
Obviously, with insurance being such a main
driver of our economy in Bermuda and we have seen
past evolutions of how this industry provides value
and efficiencies through IL Ss before this, so we support the legislation catching up to and allowing stability
for the industry through the collateralized insurance
class and the IIGBs.
The President: Thank you, Senator Kempe.
646 29 July 2019 Official Hansard Report
Bermuda Senate Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, it is over to you.
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Insurance Amendment Act 2019
be now read a second time.
The President: Is there any objection to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move to
that Standing Order 26 be suspended in respect of
this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
INSURANCE AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Insurance Amendment Act 2019
be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Insurance Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Insurance Amendment Act 2019
was given a third reading and passed.]
The President: I believe your last Bill is the consideration of the draft Order enti tled Money Service Bus iness Order 2019?
Sen. Vance Campbell: That is correct.
The President: You have the floor, Senator Cam pbell.
Sen. Vance Campbell: Thank you, Madam President.
SUSPENSION OF STANDING ORDER 71(2)
Sen. Vance Campbell: Madam President , I move that
Standing Order 71(2) t o be suspended so that Senate
may now proceed with consideration of the draft Order
entitled the . . .
The President: The Money —
Sen. Vance Campbell: The Money Service Business
Order 2019.
[Motion carried: Standing Order 71(2) suspended.]
The President: Carry on, Senator Campbell.
Sen. Vance Campbell: It is right in front of me, Madam President .
The President: That’s all right. You have had a full
agenda here.
You have the floor.
ORDER
MONEY SERVICE BUSINESS OR DER 2019
Sen. Vance Campbell: Yes, thank you, Madam President .
Madam President, I move that the Senate do
now take under consideration the draft Order entitled
the Money Service Business Order 2019 .
The President: Is there an objection to that motion?
No objection.
Carry on, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President .
Madam President, the purpose of the Money
Service Business Order 2019 is to amend the
Money
Service Business Act 2016 by including a requirement
for money service business providers to maintain i nsurance cover for their operations.
Madam President , section 11(7) of the Act
gives the Minister of Finance the power to amend the
minimum licensing criteria by way of an order. It is
proposed to amend Schedule 1 of the Act by making it
mandatory for licensed money service providers to
maintain insurance cover that is appropriate to the
nature and scale of their businesses.
Madam President , this amendment will harmonise the Authority’s oversight of this sector with similar obligations imposed on other financial instit utions.
Bermuda Senate With those brief introductory remarks, I now
welcome Honourable Member s’ comments on this
order.
Thank you, Madam President.
The President: Thank you, Senator Campbell.
Would any Senator care to speak on this Bill?
Senator Jardine, you have t he floor.
Sen. James. S. Jardine: Thank you, Madam Pres ident, I will be very brief.
I certainly welcome this legislation. I assume
by “maintain insurance” we are talking about fidelity insurance, this would be coverage for theft, fraud and
that sort of t hing that occurs within perhaps the company itself. So, if that is the intention then I certainly
wholeheartedly support this change to the legislation.
Thank you, Madam President .
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, it is over to you.
Sen. Vance Campbell: Thank you, Madam President.
It would appear that my support team has
abandoned me.
The President: You had full support.
[Laughter]
Sen. Nicholas Kempe: I have a question, Madam
President .
[Laughter]
The President: Senator Kempe, are you serious?
No?
Sen. Vance Campbell: I have an answer for that
question.
[Laughter]
The President: You do . . .
[Laughter]
The President: Senator Campbell, you have the f loor.
It appears you have full support from the Senators.
Sen. Vance Campbell: Thank you, Madam President.
Yes, I appreciate that support, Madam Pres ident.
And I will confirm for Senator Jardine that that
relates completely to the fidelity insurance, as well.
The President: Mm-hmm.
Sen. Vance Campbell: So, with that, Madam Pres ident, I move that the said draft Order be approved
and that the following message be sent to His Exce llency, the Governor:
May it please your Excellency, the Senate,
having had under consideration the draft Order ent itled the Money Service Business Order 2019, pr oposed to be made by the Minister of Finance under
the provisions of section 11(7) of the Money Service Business Act 2016 has the honour to inform your E xcellency that the Senate has approved the said draft
Order.
The President: Is there any objection to that motion?
No objection.
Thank you, Senator Campbell, a suitable
message will be sent to the Governor.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Money Service Business Order
2019 was approved.]
The President: Senators, that concludes our Orders
of the Day. We have dealt with 11 items very well. Thank you all.
Moving on to item number 14 on our agenda.
MOTIONS
The President: There are none.
CONGRATULATORY AND/OR
OBITUARY SPEECHES
The President: Would any Senator care to speak on
this?
No? No one wants to speak so we will move
on to item number 16.
Senator Kathy Lynn Simmons, Attorney Ge neral and Government Leader in the Senate.
ADJOURNMENT
Sen. the Hon. Kathy Lynn Simmons: Thank you,
Madam President.
I move that the Senate do now adjourn until
Wednesday, August 7th.
The President: August or September? August?
[Crosstalk]
The Clerk: August.
The President: Any objections to A ugust 7th?
648 29 July 2019 Official Hansard Report
Bermuda Senate An Hon. Senator: Yes.
[Laughter]
The President: With that, Senators, we adjourn to
August the 7
th.
The Clerk: No, no.
The President: We have adjourned. Yes.
[Crosstalk]
The President: Oh, yes. Sorry.
Yes, everybody is rushing out of here. Sen ator Michelle Simmons, you have indicated that you
would like to speak on the motion to adjourn. You
have the floor.
CUP MATCH CLASSIC
Sen. Michelle Simmons: Thank you, Madam Pres ident. And thanks to my colleagues for giving me this
moment.
I will be brief, but I have some very important
information to share. First of all, at the end of this week we will be observing a two- day holiday.
The President: Mm-hmm.
Sen. Michelle Simmons: And the great news is we
have two excellent teams which will be participating in
the annual Cup Match Classic. And in my humble
opinion either team can win. Of course, I expect the
one from the East to prevail —
[Laughter]
Sen. Michelle Simmons: —but either team can win.
I would like to name all of those people who
have been selected for the teams. First of all, for the
defenders of the Cup (i.e., Somerset) we have Captain Jordan DeSilva; Vice Captain Terryn Fray; St ephen Outerbridge; Chris Douglas; Greg Maybury;
Malachi Jones; Dion Stovell; Kwasi James; Steven
Bremar ; Derrick Brangman; and Alje Richardson (who
is a colt).
The reserves for Somerset are Dalin Richar dson; Isaiah Richardson; Nyrobi Mills; and Jermal Proc-tor (who is listed as a junior reserve).
The team from the East (aka, St. George’s)
captained by Lionel Cann; Onias Bascome, as Vice Captain; Treadwell Gibbons, Jr.; Temiko Wilson; Micai
Simmons; Allan Douglas, Jr.; Zeko Burgess; Oliver
Pitcher, Jr.; Justin Pitcher; Rodney Trott; and Mackih
McGowan. And in reserve we have Nzari Paynter; Isaiah Greaves; a nd Oyinde Bascome.
I would like to thank all of those players for
stepping up and for participating in the Classic. And I would like to wish both teams the best success poss ible, which will be a wonderful match for all of us to enjoy.
I would also like t o say that I pray that this ho liday will be a peaceful, happy, jovial one for everyone.
TRAGIC LOSS OF LIFE
Sen. Michelle Simmons: I cannot end without saying
how deeply sad I am that a young man has lost his
life, just over the weekend. It is someone wh o is very
close to home for me; a former neighbour of mine.
And the family will be remembered in my prayers and
I would ask the whole country to uphold them as they
deal with this tragedy. A fine upstanding young man
has lost his life.
So, let’s be safe. Let’s look out for each other
during this holiday and let’s enjoy this time of family, fellowship, friendship and everything else that is good
in Bermuda.
Thank you, Madam President.
The President: Thank you, Senator Michelle Si mmons. I am sure all Senat ors join you in your comments, and particularly with reference to the safety
and the enjoyment of the holiday, and the significance of what it means for everyone on this Island. And also
that it would be a safe and happy one.
Did someone else want to speak?
Oh, Senator Kemp, did you want to speak on
the motion to adjourn?
You certainly can have the floor.
CUP MATCH CLASSIC
Sen. Nicholas Kempe: Thank you, Madam Pres ident, and certainly Senator Simmons took a lot of the
sentiment that I was hoping to share . . . on behalf of
the OBA Senate team, I would like to wish my co lleagues in this Chamber and those listening to have a
safe, particularly, and enjoyable holiday.
The President: Absolutely. We all agree with you.
With no other sentiments from the Senators,
then I thank you all for your time today and for the
manner in which you continue to do business.
So, the Senate is adjourned until August the
7
th. The Senate stands adjourned. Thank you all.
[At 3:04 pm, the Senate stood adjourned until
10:00 am, Wednesday, *7 August 2019.]
[The Senate did not resume on 7 August 2019.]
The President: We are doing item number 11 on the
agenda.
Senator Hayward, it is your Bill.
STANDING ORDER 25
Sen. Jason Hayward: Madam President, I move that
the provision of Standing Order 25 be granted so that the Senate may now proceed with the second reading
of the Bill entitled the Chartered Professional A ccountants Amendment Act 2019.
The Presi dent: Is there any objection to that motion?
No objection.
Carry on, Senator Hayward. [Motion carried: Leave granted for the Chartered Pr ofessional Accountants Amendment Act 2019 to be
read a second time on the same day as its first reading.]
Sen. Jason Hayward: Madam President, I now move
that the Bill entitled the Chartered Professional A ccountants Amendment Act 2019 be now read a sec-ond time.
The President: Is there any objection to the second
reading?
No.
Carry on, Senator Hayward.
BILL
SECOND R EADING
CHARTERED PROFESSIONAL ACCOUNTANTS
AMENDMENT ACT 2019
Sen. Jason Hayward: Madam President, today I i ntroduce the Bill entitled the
Chartered Professional
Accountants Amendment Act 2019 .
Madam President, in summary, this Bill makes
amendments to sections 9 and 10 of the Chartered
Professional Accountants Act 1973 to provide for the
statutory recognition of the designation “Association of Chartered Certified Accountants,” which is known i nternationally by the initials ACCA. This statutory
recognition of the designation, ACC A, will enable
members of CPA Bermuda who qualify to hold the
designation, to now have the right to use the designation in Bermuda.
Madam President, CPA Bermuda is directly
affiliated with the Chartered Professional Accountants of Canada (or CPA Canada). I ts mission is to foster
public confidence in the accountant profession by ac ting in the public interest and helping its members excel. The key objectives of CPA Bermuda are to pr omote and increase the knowledge, skill, and proficie ncy of its members and st udents; to regulate the disc ipline and professional conduct of its members and
students; to promote the best standards of practice in financial reporting; and to promote the welfare and
interests of CPA Bermuda and the accountant profession.
The Chartered Professional Accountants Act
1973 and its bylaws govern the standards of oper ations upon which CPA Bermuda functions.
Madam President , the amendments to the
CPA Bermuda Act 1973 will allow for the first time persons resident in Bermuda who hold the Assoc iation of Chartered Certified Accountants [ACCA ] designation to become members of CPA Bermuda. As a result, persons holding the ACCA designation will then
be able to practice in Bermuda with the same rights
640 29 July 2019 Official Hansard Report
Bermuda Senate and privileges as any other professional accountant
currently recognised in Bermuda.
Madam President , as a backdrop, ACCA Caribbean has been engaged in discussions with key
stakeholders in Bermuda since 2009, primarily to ad-dress recognition issues and to promote ACCA qual ifications as a viable and alternative career pathway to
becoming a chartered accountant. In 2012, Bermuda
College, through its division of Professional and C areer Education (PACE), began offering the ACCA qualification and became a licensed computer -based
testing centre for ACCA examinations.
Madam President , the ACCA Certified A ccountant Technician [ CAT] programme was deemed
to be attractive for our two public senior schools. There was an [ interest ] in incorporating the programme into the senior school curriculum as an option under th e Career Pathways programme. However, the
lack of market recognition of the ACCA accountant
qualification was a significant drawback.
Madam President , unlike many of the other
accounting designations, students do not need a
bachelor’s degree to enrol in A CCA programmes.
They can [attend] the ACCA programme and earn
their bachelor’s and master’s degrees as they pr ogress through the coursework with three years of rel evant work experience.
Therefore, Madam President , with a high
number of non- Bermudian accountants on work permits on the Island, the ACCA accounting designation
provides an avenue for Bermudians to earn an inter-nationally recognised professional accounting desi gnation without having to leave the Island to earn a
bachelor’s degree.
Madam Preside nt, the ACCA qualification upholds the global accounting education standards set
by the International Federation of Accountants and the
qualification has been officially benchmarked to the
master’s degree level by Oxford Brookes University in
the United Ki ngdom. After several years of advocacy
and dialogue with a number of Government Ministers
and officials promoting the values and benefits of the
ACCA qualification, in 2018, CPA Bermuda agreed to support the amendment of the Act so that ACCA
members could become members of CPA Bermuda,
having the same rights to practice in Bermuda as ot her chartered accountants.
Madam President , the amendments to the
CPA Bermuda Act and the subsequent bylaws by
negative resolution will recognise all qualified accountants w hose designations are listed in the new
scheduled section 9(3) under clause 2 of the Bill on an
equal footing. The amended Act will also introduce
competition in the market, thus facilitating choice, dri ving standards and ultimately growing the economy.
The amendment will allow for the Act and the bylaws
to take into account those accountants entering into
Bermuda on a temporary basis, thus strengthening the regulatory arm of the accountant profession and
protecting the public.
Thank you, Madam President .
The President: Thank you, Senator Hayward.
Would any Senator care to speak on this Bill?
No . . . Oh, Senator Richardson, you have the
floor.
Sen. Anthony Richardson: Madam President, [I
have] very few brief comments. I think I know that
around the tab le the intended change will impact the
professional body for at least 1, 2, 3, 4 of us that sit
around the table. And I just want to, I guess, further
emphasise the impact of what has been done today.
As you know, we are all members of the
community and once it was known that this was going to be coming to this table for a discussion and debate,
others have actually said to me that this a good thing
for us because there are many persons who were in
Bermuda previously that did qualify under the ACCA
guideli nes and were not able to really fully practice in
Bermuda.
By way of brief history, Bermuda has always
had a very strong demand for accountants. And I know, probably around 2002 (give or take) even the
government had some challenges in finding staff. I
was part of the process whereby we actually went to
broaden our catch (if that is the right way to put it) and
went to the Caribbean, and we were able to identify
several qualified professionals to come to Bermuda
and some of them are still here. And so now t hey will
be able to have a better opportunity to practice as pr ofessional accountants as we move forward.
And as Senator Hayward mentioned, I was
pleasantly surprised in preparing for today’s discussion to contact CPA Bermuda and to understand that
one of the advantages of this legislation is that now
there will be one body that actually is able to govern all persons who qualify or practice as accountants,
which will have a positive impact on the AML/ATF
guidelines. And so going forward it will be easier for
Bermuda to manage all those persons who identify
themselves as accountants.
And for the general public to understand that,
to put myself, or to put yourself forward as an ac-countant, it does not happen by osmosis. There is a
full process that you have t o go through. And in terms
of those who are purchasing accounting services, it
will be interesting for them to make sure that if the
person is providing professional services, that they should be registered in Bermuda, which means to
come under the CPA gui delines, and that will assist us
overall in ensuring that there is a consistent level of
professionalism as persons provide those services.
Thank you, Madam President.
The President: Thank you, Senator Richardson.
Bermuda Senate ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: I would just like to acknowledge the
presence of the Parliamentary Counsel, Gwen Joh nson, in the Chamber. And welcome to you.
[Chartered Professional Accountants Amendment Act
2019, second reading debate, continuing]
The President: Would any other Senator care to
speak? Oh, Senator Kempe. You have the floor.
Sen. Nicholas Kempe: Yes, thank you, Madam President .
We know the industry has been asking for this
for a while and it has been a long time coming. We
support this legislatio n.
The President: Thank you, Senator Kempe.
Senator Hayward, over to you.
Sen. Jason Hayward: Madam President, I now move
that the Bill entitled the Chartered Professional A ccountants Amendment Act 2019 be now read a second time.
The President: Is the re any objection to that motion?
No objection. Carry on, Senator Hayward.
SUSPENSION OF STANDING ORDER 26
Sen. Jason Hayward: Madam President, I now move
that we suspend Standing Order 26 in relation to this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
CHARTERED PROFESSIONAL ACCOUNTANTS
AMENDMENT ACT 2019
Jason Hayward: Madam President, I now move that
the Bill entitled the Chartered Professional Accountants Amendment Act 2019 be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Jason Hayward: Madam President, with no objections, I now move that the Bill do now pass.
The President: It has been moved that t he Bill ent itled the Chartered Professional Accountants Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection. The Bill is passed.
Thank you, Senator Hayward.
[Motion carried: The Chartered Professional Accountants Amendment Act 2019 was given a third reading
and passed.]
The President: We will now go back to our [ Order
number] (7), the second reading of the Corporate Service Provider Business Amendment Act 2019.
Senator Campbell, this is your Bill. You have
the floor.
STANDING ORDER 25
Sen. Vance Campbell: Thank you, Madam President.
Madam President, I move that the provisions
of Standing Order 25 be granted so that the Senate
may now proceed with second reading of the Bill ent itled the Corporate Service Prov ider Business
Amendment Act 2019.
The Clerk: Do the other two titles as well, at the same
time.
Sen. Vance Campbell: [At] the same time?
The President: Mm-hmm.
The Clerk: Yes, do the others.
Sen. Vance Campbell: Also, Madam President, I
move that prov isions of Standing Order 25 be granted
so that the Senate may now proceed with second reading of the Bills entitled the Trusts (Regulation of
Trust Business) Amendment Act 2019 and the Insurance Amendment Act 2019.
The President: Any objection to that mot ion?
No objection.
[Motion carried: Leave granted for the Corporate Service Provider Business Amendment Act 2019, Trusts
(Regulation of Trust Business) Amendment Act 2019 ,
and the Insurance Amendment Act 2019 to be read a
second time on the same day as their first reading.]
Sen. Vance Campbell: Thank you, Madam President.
The President: Carry on, Senator Campbell.
642 29 July 2019 Official Hansard Report
Bermuda Senate BILL
SECOND READING
CORPORATE SERVICE PROVIDER BUSINESS
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, the Government wishes t he Senate now to give consideration
to the Bill entitled Corporate Service Provider Bus iness Amendment Act 2019 , the Act.
The purpose of the proposed amendments to
the Act is to enhance the Bermuda Monetary Author ity’s [BMA] regulation of licensed corporate service
providers [CSP] and to align Bermuda’s regime with evolving international best practice and regulatory
standards for the oversight of corporate service provider businesses.
Madam President , the Ministry of Finance has
been advised by the BMA that the regulatory fram ework for the corporate service provider sector will be
assessed by The Group of International Financial
Centre Supervisors ( GIFCS ) in 2020. Accordingly, key
amendments to the Act are required to further comply
with the GIFCS standard on the regulation of corporate service provider and are as follows:
1. To require licensed corporate service pr oviders to maintain a physical presence in Bermuda. Senators are advised that the
objective of this requirement is to ensure
that the Bermuda Monetary Authority is
capable of exercising the appropriate reg-ulatory influence over corporate service
providers.
2. To remove the fee prescribed for the i nspection of the register of licensed corporate service provider businesses. Sen ators are advised that such a fee is no
longer payable as the list of licensed CSPs is available to the public on the
BMA’s website.
3. To require that the BMA must approve the
surrender of a licence prior to the surrender coming into effect. Senators are advised that this measure is to protect cl ients’ interests and ensure that the corporate service provider business is wound
down or transferred appropriately.
4. To insert a provision requiring client money to be segregated from the licensed
businesses own funds and maintaining
accounting records to readily identify such
client money. Senators are advised that
this measure is intended to avoid the comingling of funds to protect clients’ interests in the event a corporate service pr ovider fails.
5. To add a power for the Authority to ex-empt or modify prudential standards or requirements. Senators are advised that
this provision will allow the BMA to ex-empt a CSP from the necessity to comply
with t he prudential requirement following
an assessment of the CSP's nature and scale. Avoiding a one- size-fits-all a pproach is the cornerstone of the BMA’s
risk-based approach to regulation.
Madam President , the Senate is advised the
BMA has met with members of the corporate service
provider sector to discuss the amendments. In add ition, as per the BMA’s normal custom and practice,
published a consultation paper together in June 2019
to advise industry of the proposed changes. The consultation results were pub lished by the BMA on its
website on the 24
th of July 2019. Madam President ,
there were 94 corporate service providers licensed by the BMA.
With that, Madam President , I conclude my i nitial presentation. Thank you, Madam President .
The President: Thank you, Senator Campbell.
ANNOUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: I would just like to take this opportunity to acknowledge the presence of Elizabeth Copeland from the Policy Department of the BMA.
Welcome to you, Madam.
[Corporate Ser vice Provider Business Amendment Act
2019 , second reading debate, continuing]
The President: Would any Senator care to speak on
this Bill?
Senator Kempe?
Sen. Nicholas Kempe: No.
The President: I’m sorry. I thought you were reaching
for your microphone.
Sen. Nicholas Kempe: No, Madam President, we
understand these are housekeeping from BMA and
we support the progression of these laws.
The President: Thank you.
Would any other Senator care to speak on
this Bill?
No? Then, Senator Campbell, it is ov er to you.
Sen. Vance Campbell: Thank you, Madam President.
And thank you, fellow Senators.
Madam President, I move that the Bill entitled
the Corporate Service Provider Business Amendment
Act 2019, be now read a second time.
Bermuda Senate The President: Is there an y objection to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move to
that Standing Order 26 be suspended in respect of
this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
CORPORATE SERVICE PROVIDER BUSINESS
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Corporate Service Provider Bus iness Amendment Act 2019, be now read a third time.
The President: Is there any objection to the third
reading?
No objection, Senator Campbell.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled t he Corporate Service Provider Business
Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection. The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Corpor ate Service Provider Bus iness Amendment Act 2019 was given a third reading
and passed.]
The President: You will go on now to your —
Sen. Vance Campbell: Next one.
The President: —the next one, the Trusts (Regul ation of Trust Business) Amendment Act 2019.
You have the floor.
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Trusts (Regulation of Trust Bus iness) Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
Carry on.
BILL
SECOND READING
TRUSTS (REGULATION OF TRUST BUSINESS)
AMENDMENT ACT 2019
Sen. Vance Campbell: Thank you, Madam President.
Madam President, Government wishes the
Senate now to give consideration to the Bill entitled
the Trusts (Regulation of Trust Business) Amendment
Act 2019 . The purpose of the proposed amendments
to the Trusts (Regulation of Trust Business) Act 2001
is to enhance the Bermuda Monetary Authority’s reg ulation of licensed trust businesses and to align Be rmuda’s regime with evolving international best prac-tice and regulatory standards for the oversight of trust
businesses.
Madam President , the Ministry of Finance has
been advised by the BMA that the regulatory fram ework for the trust sector will be assessed by the G roup
of International Financial Centre Supervi sors (GIFCS)
in 2020. Accordingly, the key amendments to the Act are required to further comply with the GIFCS’s
standard on the regulation of trust service providers
and are as follows (and these are identical to the Bill
that we just dealt with, Madam Pr esident , so I will just
go through them quickly) :
1. To require licensed trust businesses to
maintain a physical presence in Bermuda.
2. To remove the fee prescribed for the i nspection of the register of licensed trust businesses , because they can be found
on th e website .
3. To require that the BMA must approve the surrender of a licence prior to the surrender coming into effect.
4. To insert a provision requiring client money to be segregated from the licensed trust businesses own funds and maintai ning accounting records to readily identify such client money.
5. To add a power for the Authority to make
rules prescribing annual returns and adding a power for the Authority to exempt or modify prudential standards or requir ements.
6. To enhance the minimum criteria for l icensing to impose an obligation to mai ntain adequate liquidity in order to be deemed to be conducting business in a prudent manner.
Madam President , the BMA has met with
members of the Bermuda Association of Licensed Trustees to discuss the amendments. Senat ors are
644 29 July 2019 Official Hansard Report
Bermuda Senate advised that concerns were raised by industry regar ding the proposed amendments to the Act to facilitate
physical presence requirements.
Madam President , the Authority has now determined that they will use a combination of desk -
based reviews, prudential meetings, and onsite visits
to make a determination of the suitability of a trust
business’s ongoing physical presence. Accordingly,
the consultation results were published online by the
BMA on the 24th of July 2019.
Madam President , in addition to the above, as
per the Authority’s normal custom and practice, a consultation paper, together with a draft Bill were published in June 2019 to advise the industry of the proposed changes. Madam President , presently there are
28 licensed trust companies supervised by the BMA.
With that, Madam President , I conclude my i nitial presentation. Thank you, Madam President .
The President: Thank you, Senator Campbell.
Would any Senator care to speak on this Bill?
No. Senator Campbell, it is back over to you.
Sen. Vance Campbell: Thank you, Madam President.
Thank you, Senators, for your support.
Madam President, I move that the Bill entitled
the Trusts (Regulation of Trust Business) Amendment
Act 2019 be now read a second time.
The President: Is there any object ion to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move that
Standing Order 26 be suspended in respect of the Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
TRUSTS (REGULATION OF TRUST BUSINESS)
AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Trusts (Regulation of Trust Bus iness) Amendment Act 2019, be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Trusts (Regulation of T rust Business)
Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Trusts (Regulation of Trust Business) Amendment Act 2019 was given a third reading
and passed.]
The President: We will now move on to [Order] number (9), the second reading of the Insurance Amendment Act 2019.
Sen. Vance Campbell: Madam President, it is me
again.
[Crosstalk]
ANN OUNCEMENT BY THE PRESIDENT
SENATE VISITOR
The President: While you are getting yourself toget her, can I just acknowledge the presence of the Mini ster of Education, Minister Rabain, who is in the Gallery.
Welcome to you, Minister.
[Insurance Amendment A ct 2019, second reading debate, continuing]
The President: Senator Campbell, you have the floor.
Sen. Vance Campbell: Thank you, Madam President.
I move that the Bill entitled the Insurance
Amendment Act 2019 be now read a second time.
The President: Is there any objection to that motion?
No objection.
BILL
SECOND READING
INSURANCE AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I am
pleased to present to the Senate the Bill entitled the
Insurance Amendment Act 2019
.
Bermuda Senate This Bill seeks to amend the Insurance Act
1978 by making a number of changes to the Act to
introduce and establish two new classes of limited
purpose insurers and a new category of intermediary,
to be known as “insurance marketplace providers.”
Madam President , the Bermuda Monetary
Authority is, and has always been, committed to the
enhancement of the viability of the Bermuda insurance market. Over the years, the Authority has been
recognised as a centre of excellence f or innovation
and for providing a regulatory environment that appropriately regulates and supervises the insurance
industry , while remaining conducive to product and
technological innovation. It is toward this end that the
Authority proposes to introduce new classes of LPIs, a fully collateralized insurer class to be known as “collateralized insurers,” and an innovation class to be
known as “general business innovative insurers” or
Class IIGB.
Madam President , the collateralized insurance
class will be available to those insurers with complex
collateralized structures as well as insurers with deals
that are not an ideal fit for the existing special purpose
insurer, or other insurance classes ’ regulatory fram eworks.
Madam President , the special purpose insurance [ SPI] framework was established for less complex, limited duration, catastrophe bonds, or similar
transactions. However, Madam President , over time
these structures have grown to include more complex
structures and deals. The collateralized insurer framework is specifically tailored to cater for the innovations and continuing transformation of the insurance link security structures.
Madam President , the Authority in 2018 established an insurance regulatory sandbox and an
insurance innovation hub. There is now a need for a post sandbox innovation class where some of these
companies can graduate into following a successful
testing period. While the existing and proposed clas-ses are still available for the sandbox graduating
companies, as long as they appropriately fit into the
respective class definition, the proposed IIGB class will primarily cater specifically to companies that seek
to utilise digital assets in their insurance operation.
For example, accepting premiums and paying indem-nity coverage in digital assets.
Madam President , the Authority has also no ted growing interest in the establishment of InsurTech-related pl atforms, established for the purpose of bringing insurance buyers and sellers together to buy and sell insurance coverage via auction, or other ar-rangements, or for trading insurance contracts, generally referred to as “insurance marketplace provi ders.” Th is has been noted from the Authority’s engagement with market participants in relation to the
insurance sandbox, and innovation hub- related appl ications and inquiries. The Authority is therefore pr oposing to introduce a new intermediary class to be called “insurance marketplace providers.” Corr espond ingly, a sandbox licence will be introduced for
this new intermediary which will be called “IMPs.”
Madam President , the Authority is proposing
changes to the Act to add these new classes and to enhance the exis ting rules, regulations, and codes
that support and form the regulatory framework for
these new classes. The rules related to regulatory
reporting and capital requirements will be drafted by
the Authority and consulted upon later this year.
Madam President , while the proposed insurer
regimes are being designed to meet the international insurance regulatory standards adopted by the International Association of Insurance Supervisors [the
IAIS], they do not fall within the commercial framework
that are Solvency II equivalent.
Madam President , the proposed regulatory
regime for insurance marketplaces will be similar to
that for insurance agents. A draft code of conduct for
insurance marketplace was published on the 14
th of
May 2019, along with a consultation paper, to address
the additional components of the framework. Madam
President , the Senate is advised that the Authority has
given due consideration to all the feedback prior to
finalisation of the new regulatory regime.
Madam President , the amendments repr esent
a collaborative effort between the Authority and var ious industry stakeholders. I would like to thank all of
those persons within the Bermuda Monetary Authority,
the Attorney General’s Chambers, the Ministry of F inance, and the private sector who hav e assisted with
the development of this Bill.
Madam President, under the present InsurTech framework, the Authority has received six appl ications from insurers and insurance intermediaries, of which three have registered to date. With that, Madam
Preside nt, I now conclude my introductory remarks .
The President: Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
The President: Would any Senator care to speak on
this Bill?
Senator Kempe, you have the floor.
Sen. Nicholas Kemp e: Thank you, Madam Pres ident. And thank you, Senator Campbell, for your
summary.
Obviously, with insurance being such a main
driver of our economy in Bermuda and we have seen
past evolutions of how this industry provides value
and efficiencies through IL Ss before this, so we support the legislation catching up to and allowing stability
for the industry through the collateralized insurance
class and the IIGBs.
The President: Thank you, Senator Kempe.
646 29 July 2019 Official Hansard Report
Bermuda Senate Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, it is over to you.
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Insurance Amendment Act 2019
be now read a second time.
The President: Is there any objection to the second
reading?
No objection.
SUSPENSION OF STANDING ORDER 26
Sen. Vance Campbell: Madam President, I move to
that Standing Order 26 be suspended in respect of
this Bill.
The President: Is there any objection to that motion?
No objection.
[Motion carried: Standing Order 26 suspended.]
BILL
THIRD READING
INSURANCE AMENDMENT ACT 2019
Sen. Vance Campbell: Madam President, I move that
the Bill entitled the Insurance Amendment Act 2019
be now read a third time.
The President: Is there any objection to the third
reading?
No objection.
Sen. Vance Campbell: Madam President, I move that
the Bill do now pass.
The President: It has been moved that the Bill ent itled the Insurance Amendment Act 2019 do now pass.
Is there any objection to that motion?
No objection.
The Bill has passed.
Thank you, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Insurance Amendment Act 2019
was given a third reading and passed.]
The President: I believe your last Bill is the consideration of the draft Order enti tled Money Service Bus iness Order 2019?
Sen. Vance Campbell: That is correct.
The President: You have the floor, Senator Cam pbell.
Sen. Vance Campbell: Thank you, Madam President.
SUSPENSION OF STANDING ORDER 71(2)
Sen. Vance Campbell: Madam President , I move that
Standing Order 71(2) t o be suspended so that Senate
may now proceed with consideration of the draft Order
entitled the . . .
The President: The Money —
Sen. Vance Campbell: The Money Service Business
Order 2019.
[Motion carried: Standing Order 71(2) suspended.]
The President: Carry on, Senator Campbell.
Sen. Vance Campbell: It is right in front of me, Madam President .
The President: That’s all right. You have had a full
agenda here.
You have the floor.
ORDER
MONEY SERVICE BUSINESS OR DER 2019
Sen. Vance Campbell: Yes, thank you, Madam President .
Madam President, I move that the Senate do
now take under consideration the draft Order entitled
the Money Service Business Order 2019 .
The President: Is there an objection to that motion?
No objection.
Carry on, Senator Campbell.
Sen. Vance Campbell: Thank you, Madam President .
Madam President, the purpose of the Money
Service Business Order 2019 is to amend the
Money
Service Business Act 2016 by including a requirement
for money service business providers to maintain i nsurance cover for their operations.
Madam President , section 11(7) of the Act
gives the Minister of Finance the power to amend the
minimum licensing criteria by way of an order. It is
proposed to amend Schedule 1 of the Act by making it
mandatory for licensed money service providers to
maintain insurance cover that is appropriate to the
nature and scale of their businesses.
Madam President , this amendment will harmonise the Authority’s oversight of this sector with similar obligations imposed on other financial instit utions.
Bermuda Senate With those brief introductory remarks, I now
welcome Honourable Member s’ comments on this
order.
Thank you, Madam President.
The President: Thank you, Senator Campbell.
Would any Senator care to speak on this Bill?
Senator Jardine, you have t he floor.
Sen. James. S. Jardine: Thank you, Madam Pres ident, I will be very brief.
I certainly welcome this legislation. I assume
by “maintain insurance” we are talking about fidelity insurance, this would be coverage for theft, fraud and
that sort of t hing that occurs within perhaps the company itself. So, if that is the intention then I certainly
wholeheartedly support this change to the legislation.
Thank you, Madam President .
The President: Thank you, Senator Jardine.
Would any other Senator care to speak on
this Bill?
No. Then, Senator Campbell, it is over to you.
Sen. Vance Campbell: Thank you, Madam President.
It would appear that my support team has
abandoned me.
The President: You had full support.
[Laughter]
Sen. Nicholas Kempe: I have a question, Madam
President .
[Laughter]
The President: Senator Kempe, are you serious?
No?
Sen. Vance Campbell: I have an answer for that
question.
[Laughter]
The President: You do . . .
[Laughter]
The President: Senator Campbell, you have the f loor.
It appears you have full support from the Senators.
Sen. Vance Campbell: Thank you, Madam President.
Yes, I appreciate that support, Madam Pres ident.
And I will confirm for Senator Jardine that that
relates completely to the fidelity insurance, as well.
The President: Mm-hmm.
Sen. Vance Campbell: So, with that, Madam Pres ident, I move that the said draft Order be approved
and that the following message be sent to His Exce llency, the Governor:
May it please your Excellency, the Senate,
having had under consideration the draft Order ent itled the Money Service Business Order 2019, pr oposed to be made by the Minister of Finance under
the provisions of section 11(7) of the Money Service Business Act 2016 has the honour to inform your E xcellency that the Senate has approved the said draft
Order.
The President: Is there any objection to that motion?
No objection.
Thank you, Senator Campbell, a suitable
message will be sent to the Governor.
Sen. Vance Campbell: Thank you, Madam President.
[Motion carried: The Money Service Business Order
2019 was approved.]
The President: Senators, that concludes our Orders
of the Day. We have dealt with 11 items very well. Thank you all.
Moving on to item number 14 on our agenda.
MOTIONS
The President: There are none.
CONGRATULATORY AND/OR
OBITUARY SPEECHES
The President: Would any Senator care to speak on
this?
No? No one wants to speak so we will move
on to item number 16.
Senator Kathy Lynn Simmons, Attorney Ge neral and Government Leader in the Senate.
ADJOURNMENT
Sen. the Hon. Kathy Lynn Simmons: Thank you,
Madam President.
I move that the Senate do now adjourn until
Wednesday, August 7th.
The President: August or September? August?
[Crosstalk]
The Clerk: August.
The President: Any objections to A ugust 7th?
648 29 July 2019 Official Hansard Report
Bermuda Senate An Hon. Senator: Yes.
[Laughter]
The President: With that, Senators, we adjourn to
August the 7
th.
The Clerk: No, no.
The President: We have adjourned. Yes.
[Crosstalk]
The President: Oh, yes. Sorry.
Yes, everybody is rushing out of here. Sen ator Michelle Simmons, you have indicated that you
would like to speak on the motion to adjourn. You
have the floor.
CUP MATCH CLASSIC
Sen. Michelle Simmons: Thank you, Madam Pres ident. And thanks to my colleagues for giving me this
moment.
I will be brief, but I have some very important
information to share. First of all, at the end of this week we will be observing a two- day holiday.
The President: Mm-hmm.
Sen. Michelle Simmons: And the great news is we
have two excellent teams which will be participating in
the annual Cup Match Classic. And in my humble
opinion either team can win. Of course, I expect the
one from the East to prevail —
[Laughter]
Sen. Michelle Simmons: —but either team can win.
I would like to name all of those people who
have been selected for the teams. First of all, for the
defenders of the Cup (i.e., Somerset) we have Captain Jordan DeSilva; Vice Captain Terryn Fray; St ephen Outerbridge; Chris Douglas; Greg Maybury;
Malachi Jones; Dion Stovell; Kwasi James; Steven
Bremar ; Derrick Brangman; and Alje Richardson (who
is a colt).
The reserves for Somerset are Dalin Richar dson; Isaiah Richardson; Nyrobi Mills; and Jermal Proc-tor (who is listed as a junior reserve).
The team from the East (aka, St. George’s)
captained by Lionel Cann; Onias Bascome, as Vice Captain; Treadwell Gibbons, Jr.; Temiko Wilson; Micai
Simmons; Allan Douglas, Jr.; Zeko Burgess; Oliver
Pitcher, Jr.; Justin Pitcher; Rodney Trott; and Mackih
McGowan. And in reserve we have Nzari Paynter; Isaiah Greaves; a nd Oyinde Bascome.
I would like to thank all of those players for
stepping up and for participating in the Classic. And I would like to wish both teams the best success poss ible, which will be a wonderful match for all of us to enjoy.
I would also like t o say that I pray that this ho liday will be a peaceful, happy, jovial one for everyone.
TRAGIC LOSS OF LIFE
Sen. Michelle Simmons: I cannot end without saying
how deeply sad I am that a young man has lost his
life, just over the weekend. It is someone wh o is very
close to home for me; a former neighbour of mine.
And the family will be remembered in my prayers and
I would ask the whole country to uphold them as they
deal with this tragedy. A fine upstanding young man
has lost his life.
So, let’s be safe. Let’s look out for each other
during this holiday and let’s enjoy this time of family, fellowship, friendship and everything else that is good
in Bermuda.
Thank you, Madam President.
The President: Thank you, Senator Michelle Si mmons. I am sure all Senat ors join you in your comments, and particularly with reference to the safety
and the enjoyment of the holiday, and the significance of what it means for everyone on this Island. And also
that it would be a safe and happy one.
Did someone else want to speak?
Oh, Senator Kemp, did you want to speak on
the motion to adjourn?
You certainly can have the floor.
CUP MATCH CLASSIC
Sen. Nicholas Kempe: Thank you, Madam Pres ident, and certainly Senator Simmons took a lot of the
sentiment that I was hoping to share . . . on behalf of
the OBA Senate team, I would like to wish my co lleagues in this Chamber and those listening to have a
safe, particularly, and enjoyable holiday.
The President: Absolutely. We all agree with you.
With no other sentiments from the Senators,
then I thank you all for your time today and for the
manner in which you continue to do business.
So, the Senate is adjourned until August the
7
th. The Senate stands adjourned. Thank you all.
[At 3:04 pm, the Senate stood adjourned until
10:00 am, Wednesday, *7 August 2019.]
[The Senate did not resume on 7 August 2019.]
Hansard Transcript
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