The main debate centered on Senate amendments to a bill requiring the Premier to annually report names and salaries of political staff. The Opposition supported the Senate's changes, arguing they improved transparency and good governance. The Government rejected the amendments, with Minister Burch claiming the Opposition coordinated an "ambush" in the Senate with Independent senators. The Education Minister announced new scholarships for Bermudian students to attend University of the West Indies campuses.
Senate amendments to the Premier, Ministers and Opposition Leader Personal Staffs Act 2019 - requiring annual disclosure of political staff names and salariesNew scholarship program with University of the West Indies (UWI) - $35,000 allocated for Bermudian studentsParliamentary procedure dispute over how Senate amendments should be handledVarious congratulatory remarks for graduations, sports teams, and condolences
Bills & Motions
Premier, Ministers and Opposition Leader Personal Staffs Act 2019 - Senate amendments rejected by Government, original bill to proceed unchanged
Pharmacy and Poisons (Third and Fourth Schedule) Amendment Order 2019 - tabled by Health Minister
Notable Moments
Heated exchange between Minister Burch and Opposition over Senate procedures, with Burch accusing Independent Senator Jardine of consistently voting against the Government
Premier Burt clarified he never promised to amend the staff disclosure bill, contrary to Opposition claims about his earlier "undertaking"
Government voted to reject all Senate amendments despite Opposition arguments that the changes were harmless improvements
Debate Transcript
519 speeches from 28 speakers
The SpeakerThe SpeakerGood morning, M embers. [Gavel] [Pause] CONFIRMATION OF MINUTES [Minutes of 7 June 2019]
The SpeakerThe SpeakerMembers , the Minutes from the 7th of June have to be confirmed. They have been circula ted. Any omissions or amendments? There are none. They are confirmed as print ed. [Minutes of 7 June 2019 confirmed] MESSAGES FROM THE GOVERNOR
The SpeakerThe SpeakerThere are none. ANNOUNCEMENTS BY THE SPEAKER OR MEMBER PRESIDING
The SpeakerThe SpeakerYes. OMBUDSMAN FOR BERMUDA ANNUAL REPORT 2018
The SpeakerThe SpeakerThis morning I would like to anno unce that I have received the Ombudsman for Bermuda Annual Report 2018, which has been submitted to the House to the Speaker’s Chamber in compliance with section 24(1) and 24(3) of the Ombudsman Act 2004. APOLOGIES
The SpeakerThe SpeakerAlso, I would just like to note that we have received notice that Minister Caines will not be present today. MESSAGES FROM THE SENATE PREMIER, MINISTERS AND OPPOSITION LEADER PERSONAL STAFFS ACT 2019
The SpeakerThe SpeakerYes. We do have a message from the Senate. And I will read it in i ts entirety. And it states : “To His Honour the Speaker and Members of the Honourable House of Assembly: The Senate has the honour to return to Your Honourable House t he accompanying Public …
Yes. We do have a message from the Senate. And I will read it in i ts entirety. And it states : “To His Honour the Speaker and Members of the Honourable House of Assembly: The Senate has the honour to return to Your Honourable House t he accompanying Public Bill entitled the ‘Premier, Ministers and Opposition Leader Person al Staffs Act 2019 ’, recommending the concurrence of your Honourable House in the following suggested amendment, which it is proposed should be made to the Bill: –” And those amendments are in clause 9 and read as follows: “1. By deleting the word ‘ March’ and substituting the word ‘May’ in the first paragraph; “2. By deleting the words ‘ appointed to a ’ and substituting the words ‘ who have served or are currently serving on any ’ in the first paragraph; “3. By deleting the word ‘calendar ’ and substituting the word ‘ fiscal ’ in the first paragraph; “4. By inserting the word ‘gross ’ immediately after the word ‘their’ in subsection 9(b); and “5. By inserting the words ‘for the entire fiscal year’ immediately after the word ‘remuneration’ in subsection 9(b). “The effect of the proposed amendments being such that the Amended version of Clause 9 would read as follows: “Annual report “9 On or before 31 May, the Premier shall lay in each House of the Legislature a r eport listing the names of all persons who have ser ved or are currently serving on any personal staff during the previous fi scal year, indicating — “(a) their functions; “(b) their gross remuneration for the entire fiscal year; and “(c) in the case of the personal staff of a Minister, whether each person was appointed as an expert in a spec ified field or as a political adviser. ” That is the entire message that we received from the Senate. Mr. Premier, would you like to speak to that? 1842 21 June 2019 Official Han sard Report
Bermuda House of Assembly Hon. E. David Burt: Thank you, Mr. Speaker. Under the provision of Standi ng Order 31(2), I move that the amendments proposed by the Senate to the Bill entitled the Premier, Ministers and Oppos ition Leader Personal Staffs Act 2019 be considered forthwith in this House.
The SpeakerThe SpeakerAre there any objections? No objections. Continue. Hon. E. David Burt: Thank you very much, Mr. Speaker. I move that the Bill be now committed.
The SpeakerThe SpeakerYes. The Bill will now be committed so we can discuss the [Senate’s] amendment to clause 9. Deputy. House in Committee at 10:11 am [Hon. Derrick V. Burgess, Sr., Chairman] COMMITTEE ON BILL AS AMENDED BY THE SENATE PREMIER, MINISTERS AND OPPOSITION LEADER PERSONAL STAFFS ACT 2019 [Amendment to clause …
The ChairmanChairmanMembers, we are now in Committee of the whole [House] for further cons ideration of the Bill entitled . . . clause 9 of the Bill, Premier, Ministers and Opposition Leader Personal Staffs Act 2019. Mr. Premier, you have the floor. Hon. E. David Burt: Thank you very much, Mr. …
Members, we are now in Committee of the whole [House] for further cons ideration of the Bill entitled . . . clause 9 of the Bill, Premier, Ministers and Opposition Leader Personal Staffs Act 2019. Mr. Premier, you have the floor. Hon. E. David Burt: Thank you very much, Mr. Chairman. Mr. Chairman, the amendments that have come from the Senate . . . it was a very interesting process, as I understand it, as the Government was not aware of the amendments prior to their tabling and/or discussion, which is something that typically does happen. And the first time they were notifi ed was at the moment of tabling. That much notwithstanding, Mr. Chairman, I remember that there was a debate on similar measures inside of this House. And at that time ( if you will allow me to refer to my comments from the draft 1Hansard) , I said, “As it is written here and construc ted, we do not necessarily believe that what he” (and it was the Honourable Member for constituency 22) “is suggesting is necessary.” And therefore, Mr. Chairman, I move that the amendments be rejected.
1 31 May 2019 Members’ Proof Hansard The Chairman: It has been moved that the amendments be rejected. Are there any objections to that? Mr. Pearman, you have the floor.
Mr. Scott PearmanThank you, Mr. Chairman. This was a matter that came up when the House debated this Bill. It was a matter that I had pointed out to the Premier that, in fact, the Bill, unamended as it was before the House, was technically deficient because if someone had been appointed …
Thank you, Mr. Chairman. This was a matter that came up when the House debated this Bill. It was a matter that I had pointed out to the Premier that, in fact, the Bill, unamended as it was before the House, was technically deficient because if someone had been appointed prior to 12 months, the person’s name or those people’s names would not appear. And in the interest of good go vernance, it was suggested that what should happen every year is that all of those people who are consultants (if I may use that term in the shorthand, “consultants ”) are simply named and tabled each year. That point was then picked up by my honourable fr iend, Ms. Gordon- Pamplin, at which point in time the Premier, quite rightly, in argue, respectfully, gave an undertaking that that is what would happen. The fact is that a Premier’s undertaking is li mited to an individual. It is just this particular indiv idual Premier ; it does not bind any future Premiers as the legislation should. And this was raised in the Senate. And quite properly the Senate recognised that this was an important point. They recognised the Prem-ier’s undertaking. They recognised the points made by my honourable friend, [and] by myself. And the Opposition Senators moved this Bill to amend and record those points and were supported by the Independent Senators , the reason being that it was a matter of good governance. I would be rather hopeful that the Government would take this opportunity to accept the amendments. I know that my right honourable friend, Ms. Gordon- Pamplin, will speak in a moment. Thank you, Mr. Chairman.
The ChairmanChairmanAny further speakers? The Chair recognises the Honourable Member Pat Gordon- Pamplin. You have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, I heard the Premier indicate that they would prefer to reject the recommendations that have come back from the Senate. I believe that …
Any further speakers? The Chair recognises the Honourable Member Pat Gordon- Pamplin. You have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, I heard the Premier indicate that they would prefer to reject the recommendations that have come back from the Senate. I believe that in the constitution of our Parliamentary process, good governance has got to be the ultimate aim. And it would appear to me that the checks and balances that occur within our system come from a different set of eyes looking at a set piece of legislati on and making recommendations respecting thereto. In this particular instance, Mr. Chairman, it would appear that if the Government —and they have the numbers, so they can do whatever they like. However—
Bermuda House of Assembly The Chairman: Speak to the clause. Just speak to the clause.
Hon. Patricia J. Gordon -Pamplin: Yes. Well, what I am saying is that if the Senate has rejected what we had sent down and has come back with a recommendation, I do not see anything in the recommendation that would suggest that there is anything less than good governance that is at the fore. And as a result, notwithstanding that it might be a bi tter pill, I would ask the Government to consider that, having a rejection come back from the Senate would give us the opportunity to stop, pause and reflect that the new wording of the clause, as articulated . . . (I did not have a copy of it. It is probably on my desk som ewhere. I did not see an actual copy of the amendment. I was trying to scribble it as the Speaker was indicating what the changes were. Here it is; I have it. ) But I do not believe that there is anything here that actually goes against what we would want to achieve in terms of good legislation, as well as good intent. And I do believe that the Premier, in his presen tation, had indicated that they would consider these things. And if it is enshrined in legislation, then, irrespective of the person sitting in the seat, we would then have a structure which enables proper and effective execution of the intent of this legislation. And as such, I would ask that the Government really consider accepting the Senate’s recommenda-tion on this particular legislation.
The ChairmanChairmanAny further speakers? The Chair recognises the Honourable Mini ster, Mr. Burch. You have the floor.
Lt. Col. Hon. David A. BurchMr. Chairman, I hear the explanation. And as someone who currently serves in this House as probably a junior Member, but having served in another place as a senior Member, I reject it completely , the argument that is being put forward this morning. It would carry some more weight, …
Mr. Chairman, I hear the explanation. And as someone who currently serves in this House as probably a junior Member, but having served in another place as a senior Member, I reject it completely , the argument that is being put forward this morning. It would carry some more weight, Mr. Chai rman, had there been some collaboration before the Government Senators were ambushed in the Senate. If the intent is good governance, then history will record that a successive Progressive Labour Party Go vernment had been the poster child for good gover nance in this country, Mr. Chairman. There is a wider issue at play here. And I wish to highlight it , with some [leeway] from you, Mr. Chairman, in the sense that this is probably the . . . I will not go so far as to say the first time , but it is a rare occasion indeed that three Opposition Senators would coordinate (I am not going to use another word) with three Independent Senators to ambush the Gover nment. And that is precisely what happened in the Senate. Followi ng on the heels of the Municipalities Reform Act 2019, Mr. Chairman, there seems to be a pattern. And it is designed specifically and exclusively to take advantage of what, in my opinion, is an anomaly in the Westminster system, where the Government of the day does not enjoy a majority in the Senate. And I think it is unprecedented. I mean, my opinion is that there are four Opposition Senators. And I suspect the record would show that one of those labelled Independent Senators has an unblemished record of —
Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Chairman.
The ChairmanChairmanWhat is your point of order? Hon. Patricia J. Gordon -Pamplin: The Honourable Member is misleading the House. The Senate has three [Opposition] representatives, not four. There are five Government representatives.
The ChairmanChairmanTake your seat. That is not a point of order. Take your seat.
Lt. Col. Hon. David A. BurchMr. Chairman, I believe I said it is my opinion. And I am setting out the reason why I arrive at that opinion. That Senator probably has an unblemished record of voting with the Opposition on every single matter that comes before that Chamber. You check it out! Check the …
Mr. Chairman, I believe I said it is my opinion. And I am setting out the reason why I arrive at that opinion. That Senator probably has an unblemished record of voting with the Opposition on every single matter that comes before that Chamber. You check it out! Check the record, Mr. Chairman. I must be touching a nerve.
[Inaudible interjection]
Lt. Col. Hon. Dav id A. BurchI have never seen you in the Senate. I go there, Mr. Chairman. That Honourable Member has an almost unblemished record of not o nly voting with the Opposition, but he gives them advice. And I am not going to sit idly by and act like I am Stevi e …
I have never seen you in the Senate. I go there, Mr. Chairman. That Honourable Member has an almost unblemished record of not o nly voting with the Opposition, but he gives them advice. And I am not going to sit idly by and act like I am Stevi e Wonder, who cannot see, or hear. The fact of the matter is, there appears to be, to me, four Opposition Senators, okay? He votes with them consistently. I cannot say whether he attends their caucus. But it would appear so.
The ChairmanChairmanMinister, let us try to get back to the clause. Hon. Jeanne J. Atherden: Point of order, Mr. Chai rman.
The ChairmanChairmanWhat is your point of order? POINT OF ORDER [Misleading and imputing improper motives] Hon. Jeanne J. Atherden: I believe that the Member is misleadin g the House and imputing improper m o1844 21 June 2019 Official Han sard Report Bermuda House of Assembly tives to the individual whom he …
Lt. Col. Hon. David A. BurchOkay. I could do that, then, Mr. Chairman. I am talking about Senator Jardine. And if you do not know [that], this is probably reason why you are no longer the Opposition Leader. In any case — Hon. Jeanne J. Atherden: Point of order, Mr. Chai rman.
The ChairmanChairmanWhat is your point of order? POINT OF ORDER Hon. Jeanne J. Atherden: I believe that the Member now is really starting to go into other motives than what he said at the beginning.
Lt. Col. Hon. David A. BurchMr. Chairman, and so that is the reason why the Government will reject this. First of a ll, you are setting a very dangerous precedent in our democracy, if you want to call it that. Good governance, my you -know -what! Those people do not know anything about good governance. …
Mr. Chairman, and so that is the reason why the Government will reject this. First of a ll, you are setting a very dangerous precedent in our democracy, if you want to call it that. Good governance, my you -know -what! Those people do not know anything about good governance. It only suits you to talk about good governance when you are sitting o n that side.
The ChairmanChairmanHonourable Member, take a seat. Honourable Leader of the Opposition, we will not have those comments here. Now, either y ou want to serve in this House today or you will be . . . you stay in order. I am talking to you, Mr. Cannonier. Thank you. Continue.
Lt. Col. Hon. David A. BurchMr. Chairman, we are celebrating, I cannot remember [which] anniversary it is next year of the Westminster Parliament in this country, 400 years, I believe. I bet you the record would show that Independent Members of the Senate have voted against the Government of the day, in those 400 years, …
Mr. Chairman, we are celebrating, I cannot remember [which] anniversary it is next year of the Westminster Parliament in this country, 400 years, I believe. I bet you the record would show that Independent Members of the Senate have voted against the Government of the day, in those 400 years, probably more times against the PLP Government than any other Government that existed in this country. And so, you are setting a very dangerous precedent. If you want to . . . if what is being pr esented this morning is true and pure, that we want good governance, you know why you would do that? You would have consulted with the Government Leader in the Senate before you ambushed them on the floor!
[Desk thumping]
Lt. Col. Hon. David A. BurchOkay? And you would have had a conversation. And that Leader would have had a convers ation with the Leader of the country. And you could have had unanimity. But you do not . In our system of government . . . and expect for us to sit down and …
Okay? And you would have had a conversation. And that Leader would have had a convers ation with the Leader of the country. And you could have had unanimity. But you do not . In our system of government . . . and expect for us to sit down and take it because you are going to talk about good governance? You are talking absolute nonsense, Mr. Chairman, absolute nonsense. It has nothing to do with good governance. It has to do . . . and I guarantee you this. I guarantee you this. Those people sitting down in the Gallery, you watch the headlines tomorrow. You watch the headlines tomorrow. It will be exactly what has come out of their mouths today. The PLP is not in support of good governance. That is what you are going to get in the rag tomorrow. And that is what it is designed to do. But they never wrote it , for five years that they were in Government. And we are not rejec ting good governance, Mr. Chairman. We are rejecting duplicity and conspi racy and coordination with people who are supposed to be Independents.
[Desk thumping]
Lt. Col. Hon. David A. BurchAnd I want the Pres ident and the Vice President of the Senate to know that they are getting a bad track record. Okay? B ecause even if they were consulted prior to going into that room, they had a responsibility to speak to the Government Leader in the Senate …
And I want the Pres ident and the Vice President of the Senate to know that they are getting a bad track record. Okay? B ecause even if they were consulted prior to going into that room, they had a responsibility to speak to the Government Leader in the Senate and say, This is what is being proposed. Rise and report pr ogress if you want to consult with the Leader. Y ou do not ambush the Government and then come here and expect to use your other vehicle to get us to support what you are doing. We are not going to do it. Thank you, Mr. Chairman. [Desk thumping]
The Cha irman: Thank you. The Chair recognises the Leader of the O pposition, Mr. Cannonier. Mr. Cannonier, you have the floor.
Hon. L. Craig Cannonier: Thank you, [Mr. Chai rman] . I guess in the first instance I would like to hear from the Premier as opposed to from a fellow Minister.
Bermuda House of Assembly The Chairman: No. Mr. Cannonier, you do not run this House. You make your . . . those who want to speak will speak. Continue.
Hon. L. Craig Cannonier: As I was saying, [Mr. Chairman] , I want to hear from the Premier as —
The Chair man: You will hear from the Premier. We have heard [him] already; you will hear from him again. Those are the rules.
Hon. L. Craig Cannonier: Can I ask my question? I am trying to ask a question!
The ChairmanChairmanContinue. Continue. Don’t . . . you are talking to the Chair, right? Hon. L. Craig Cannonier: I understand, Chairman. I am trying to ask a question. You keep intervening while I am trying to ask the question.
The ChairmanChairmanContinue. Hon. L. Craig Cannonier: I would like to hear from the Premier as to exactly why . . . where the harm is , in my estimation , or in his estimation, good gover nance, a harmless change to this here, which he undertook to take, as he said, …
Continue. Hon. L. Craig Cannonier: I would like to hear from the Premier as to exactly why . . . where the harm is , in my estimation , or in his estimation, good gover nance, a harmless change to this here, which he undertook to take, as he said, why he believes — Hon. E. David Burt: Point of order, Mr. Chairman.
The ChairmanChairmanWhat is your point of order, Mr. Premier? POINT OF ORDER Hon. E. David Burt: I am tired of the Opposition [mi squoting] the words from the Hansard. When we had this debate, I said I did not consider these amendments necessary. That is what I said at the tim …
What is your point of order, Mr. Premier?
POINT OF ORDER
Hon. E. David Burt: I am tired of the Opposition [mi squoting] the words from the Hansard. When we had this debate, I said I did not consider these amendments necessary. That is what I said at the tim e. The document is right here. So, when they keep on saying there was an undertak ing to amend the Bill . . . no. I said I d id not consider amendments necessary. And I do believe the a mendment , as written , accomplishes the same thing of which they are trying to do.
The ChairmanChairmanContinue, Mr. Cannonier. Hon. L. Craig Cannonier: Thank you, Mr. Chairman. I never got to say that he was going to . . . I did not say that he was going to amend the legislation, but that he said he would take it as an undertaking. Those were the …
Continue, Mr. Cannonier.
Hon. L. Craig Cannonier: Thank you, Mr. Chairman. I never got to say that he was going to . . . I did not say that he was going to amend the legislation, but that he said he would take it as an undertaking. Those were the words that were used by yourself, the Premier. So, I appreciate the fact that the Government has the right to vote on this here and the likes, and not take this here, not accept the changes that are har mless. But as we were on the floor and were listening to Honourable Members talking about conspiracy t o-wards others and the Independent Senator, I mean, the Independent Senator just about wrote a whole 100– 200-page book for the Government! To characterise him now as not working with them is v ery d uplicitous, as said by the Honourable Member, talking about duplicity. And if we are here talking about good gover nance, [Mr. Chairman] , when you talk about good go vernance, look at the list of what we are doing today when we start talking about good governance and Bills. We are here doing a first, second and third reading of a Bill today. So, you know, this thing gets more duplicitous as we go along. And it almost seems as [though], if it does not fit within what the Government feels that it wants, w e then have got to hear about all kinds of conspiracies and the likes towards the Royal Gazette and you- name- it. I do not know these people any more than the Government knows these people, like Senator Jardine and the Royal Gazette. So, to come up with these conspiracies continu e on the issue, then I feel that when they cannot come up with answers, Oh, well. We’ll just blame everyone else, rather than go along with good governance. Now, if the Premier wishes not to go with this here, then we will sit down and we will have a vote on this particular change that was . . . We used the pr ocess. The process was used. And if it went to Senate and Senate decided and the Government was not able to defeat any changes in Senate, then that is on them, not on us. We we re simply looking for good governance in Se nate. We brought it up in the House. We did not get anywhere with it. So, the next recourse is to go to Senate and to see if we can get —
Hon. E. David Burt: Point of order, Mr. Chairman.
The ChairmanChairmanMr. Premier, what is your point of order? POINT OF ORDER [Misleading] Hon. E. David Burt: The Honourable Opposition Leader is again misleading the House. The point was raised, and at that point in time, it was advised that —guess what?— if you want an amend ment, acc ording to …
Mr. Premier, what is your point of order?
POINT OF ORDER [Misleading] Hon. E. David Burt: The Honourable Opposition Leader is again misleading the House. The point was raised, and at that point in time, it was advised that —guess what?— if you want an amend ment, acc ording to Standing Orders, you must table an amendment. That was the conversation [and] discussion. The di scussion at the time also said, I do not agree with it. So, this whole rewriting of history is not appropriate.
The ChairmanChairmanWhat is your point of order? 1846 21 June 2019 Official Han sard Report Bermuda House of Assembly POINT OF ORDER [Misleading]
Mr. Scott PearmanI am afraid the Honourable Premier is misleading the House. The Honourable Premier, in fact, told me specifically, using the words (quote), “that he w ould learn me up,” that the appropriate way to make amendments to legislation was via an amending Bill. Thank you, Mr. Chairman. [Inaudible interjections] Hon. …
I am afraid the Honourable Premier is misleading the House. The Honourable Premier, in fact, told me specifically, using the words (quote), “that he w ould learn me up,” that the appropriate way to make amendments to legislation was via an amending Bill. Thank you, Mr. Chairman.
[Inaudible interjections] Hon. L. Craig Cannonier: So, now you got an amendment. That is what you got.
The ChairmanChairmanMr. Cannonier, continue. Hon. L. Craig Cannonier: Yes. So, we will go back and forth here. This was simply something that we believed to be harmless and in the vein of good gov-ernance. We thought that this would probably be a good amendment that was not egregious in any way. …
Mr. Cannonier, continue. Hon. L. Craig Cannonier: Yes. So, we will go back and forth here. This was simply something that we believed to be harmless and in the vein of good gov-ernance. We thought that this would probably be a good amendment that was not egregious in any way. But now we understand more clearly that the reason for rejecting this [amendment to the] Bill is due to duplicity, due to the fact that there is a Member within Senate whose vote, along with the OBA in the Senate— which could be so far from the truth . . . I know that we are going at loggerheads with that par-ticular Member on an ongoing basis, discussing matters. And certainly not in any of our meetings at all, whether it be in caucus or the likes. So, at the end of the day, I think it is be coming very, very clear that if the Government seems to feel that it is not getting its way, then we revert to namecalling, we revert to conspiracy [theories], and we r evert to all kinds of things , when all we are looking for is good governance. So, it w ould be good to hear from the Premier exactly why he believes this is not in the vein of good governance.
The ChairmanChairmanThank you, Mr. Cannonier. Any further speakers? The Chair will recognise the Honourable Member Kim Swan.
The ChairmanChairmanHang on, Member. Let us stick to clause 9. I have [allowed] enough latitude for the O pposition and the Government. Now we will get back just to the clause. I am not having any more co mments on this or that. Enough has been said. So, if you want …
Hang on, Member. Let us stick to clause 9. I have [allowed] enough latitude for the O pposition and the Government. Now we will get back just to the clause. I am not having any more co mments on this or that. Enough has been said. So, if you want to talk to the clause, Member, you can . Mr. Swan, continue.
Mr. Hubert (Kim) E. SwanYes. With regard to the clause, Mr. Chairman, one of the concerns that was raised with regard to the clause, “democracy” has been us ed, if you would allow me just to make reference to that. And one of the difficulties that the Go vernment would have, having spent nine …
Yes. With regard to the clause, Mr. Chairman, one of the concerns that was raised with regard to the clause, “democracy” has been us ed, if you would allow me just to make reference to that. And one of the difficulties that the Go vernment would have, having spent nine years in the other place, Mr. Chairman, is the fact that we are here elected, and—
The ChairmanChairmanLet us stick to clause 9. There has been enough commentary already. We are just here to deal with this amendment. Now, if you want to talk about the amendment, fine. But we have had enough history.
The ChairmanChairmanOkay. Thank you. Any further speakers?
Ms. Gordon- Pamplin.
Hon. Patricia J. Gordon -PamplinThank you, Mr. Chairman. Mr. Chairman, clause 9 says that any person who is serving or has —
The ChairmanChairmanWhat particular part of the clause do you have? Hon. Patricia J. Gordon -Pamplin: This is clause 9, “on or before March” . . . I am sorry , “May 31, the Premier shall lay in each House of the Legislature a report listing the names of all persons . …
What particular part of the clause do you have?
Hon. Patricia J. Gordon -Pamplin: This is clause 9, “on or before March” . . . I am sorry , “May 31, the Premier shall lay in each House of the Legislature a report listing the names of all persons . . .” It used to be “appointed to,” and it has now been changed, or recommended to be changed by, “who have served or are currently serving on any personal staff during the previous fiscal year,” (rather than “calendar year”) “i ndicating their functions ;” (which is very clear and very acceptable) . “(b) their gross remuneration for the entire fiscal year . . .” And that is in order to be able to advise the public as to how their funds are being spent. And “(c) in the case of the personal staff . . . whether . . .” because the legislation provides for either a political appointment or an expert appointment. So the public really does have the right to know whether an appointment has been political or whether it has been an expert appointment. Just, if I may, Mr. Chairman, the Minister of Works had indicated in his presentation that, with conversation, we could have had unanimity. The recommendations of the changes that have been made here are not egregious, in my estimation. It appears that the Government is only concerned about the pr ocess and not what this clause is intended to do. And I
Bermuda House of Assembly think if the Government would explain whether the clause, as amended, does not attain the best possible outcome to be able to advise the public as to how their money is being spent and who is being hired during this period of time, the Government can just say that this is an appropriate way to ensure that the pu blic knows how their money is being spent. And as stewards of the public purse, we have an obligation, I believe, to be able to include this i nformat ion for the public. And I am gathering, Mr. Chairman, it is not about the wording of the legislation. It is about the process. And I would ask that the Go vernment consider the wording and whether the wor ding achieves what is in the best interests of the taxpayer. Thank you.
The ChairmanChairmanAny further speakers? Mr. Premier, you have the floor. Hon. E. David Burt: Thank you, Mr. Chairman. I was not expecting such a long Committee session. Ho wever, I think that it has been healthy. And here is what I will say, Mr. Chairman; I will say this. I find …
Any further speakers? Mr. Premier, you have the floor.
Hon. E. David Burt: Thank you, Mr. Chairman. I was not expecting such a long Committee session. Ho wever, I think that it has been healthy. And here is what I will say, Mr. Chairman; I will say this. I find it absolutely, positively rich, coming from the Opposition, talking about good governance when we are discussing a Bill that is, for the first time, bringing into place the public disclosure of these particular it ems. Let us be clear. Before this Bill, there was no public disclosure. And now in this Bill, the Gover nment, on its own accord, is making these things publicly disclosed. And we are taking lectures on good governance?
Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker.
Hon. E. David Burt: Really?
The ChairmanChairmanWhat is your point of order? POINT OF ORDER [Misleading] Hon. Patricia J. Gordon -Pamplin: The Honourable Member has to appreciate the fact that they — [Inaudible interjections]
The ChairmanChairmanWhat is your point of order? Hon. Patricia J. Gordon -Pamplin: The point of order is that the Honourable Member is misleading the House that there has never been any disclosure. The reason why there has been no disclosure is because the disclosure has come, not through le gislation, but …
What is your point of order?
Hon. Patricia J. Gordon -Pamplin: The point of order is that the Honourable Member is misleading the House that there has never been any disclosure. The reason why there has been no disclosure is because the disclosure has come, not through le gislation, but as the result of the Government’s intent to try to hide people whom they had been hiring. The Chairman: Take your seat. Take your seat.
Hon. Patricia J. Gordon -Pamplin: And it was answered by way of our Parliamentary questions.
The ChairmanChairmanTake your seat. Take your seat.
Mr. Premier.
Hon. E. David BurtpremierSee? This is the exact point. And what you are seeing, Mr. Chairman, is the precise reason. So, I have heard lectures, you know, from the Opposition Leader, who was talking about first, second and third readings, when there is consultation. I let the Opposition Leader know. I called the …
See? This is the exact point. And what you are seeing, Mr. Chairman, is the precise reason. So, I have heard lectures, you know, from the Opposition Leader, who was talking about first, second and third readings, when there is consultation. I let the Opposition Leader know. I called the Oppos ition Leader from a football match to say that this is upcoming. The fact of the matter, Mr. Chairman, is that we are t rying to work. Now, as the Honourable Mini ster of Works said, if you wanted to do this, you would have signalled it and it would not have been thrown on the Government at the last minute without notice. And this should serve as notice, and on general princ iple, that if we want to have this type of working relationship, such as when we have briefings and hold briefings for Opposition Members so that they can be fully briefed about items beforehand, that is the courtesy that we extend. It would be decent that this courtesy would be returned to this side. So, with that, Mr. Chairman, as I have said, I move that the amendments from the Senate be r ejected.
The ChairmanChairmanIt has been moved that the amendments from the Senate be rejected. All in favour of the rej ection, say Aye. AYES.
The ChairmanChairmanThe amendment has been rejected. The Ayes have it. The Bill will be reported to the House as — The Clerk: The original Bill.
The ChairmanChairmanThe original Bill will be reported to th e House as written. [Motion carried: The Senate’s proposed amendments to clause 9 of the Premier, Ministers and Opposition Leader Personal Staffs Act 2019 were considered by a Committee of the whole House and rejected.] 1848 21 June 2019 Official Han sard …
The original Bill will be reported to th e House as written. [Motion carried: The Senate’s proposed amendments to clause 9 of the Premier, Ministers and Opposition Leader Personal Staffs Act 2019 were considered by a Committee of the whole House and rejected.]
1848 21 June 2019 Official Han sard Report
Bermuda House of Assembly House resumed at 10:37 am
[Hon. D ennis P. Lister Jr., Speaker, in the Chair]
REPORT OF COMMITTEE
PREMIER, MINISTERS AND OPPOSITION LEADER PERSONAL STAFFS ACT 2019
The SpeakerThe SpeakerMembers, I understand that the Bill has been returned to the House, [and] the Committee [has] rejected the amendments that were proposed by the message that came from the Senate, which means that a message will be sent to the other place, indicating that the original Bill will stay as …
The SpeakerThe SpeakerIt will be done. We will move on. PAPERS AND OTHER COMMUNICATIONS TO THE HOUSE
The SpeakerThe SpeakerThere are two papers to be tabled this morning . . . I am sorry, one paper to be tabled this morning, in the name of the Minister of Health. Minister. PHARMACY AND POISONS (THIRD AND FOURTH SCHEDULE) AMENDMENT ORDER 2019 Hon. Kim N. Wilson: Thank you. Good morning, Mr. …
There are two papers to be tabled this morning . . . I am sorry, one paper to be tabled this morning, in the name of the Minister of Health. Minister.
PHARMACY AND POISONS (THIRD AND FOURTH SCHEDULE) AMENDMENT ORDER 2019 Hon. Kim N. Wilson: Thank you. Good morning, Mr. Speaker. I have the honour to attach and submit for the information of the Honourable House of Assembly the Pharmacy and Poisons (Third and Fourth Schedule) Amendment Order 2019.
The SpeakerThe SpeakerThere are none. STATEMENTS BY MINISTERS AND JUNIOR MINISTERS
The SpeakerThe SpeakerWe have one Statement this morning, a Statement from the Minister of Education. Minister, would you like to put your Stat ement? Hon. Diallo V. S. Rabain: Thank you, and good morning, Mr. Speaker. Good morning, colleagues, and good morning, Bermuda. UNIVERSITY OF THE WEST INDIES ( UWI) SCHO LARSHIP …
We have one Statement this morning, a Statement from the Minister of Education. Minister, would you like to put your Stat ement? Hon. Diallo V. S. Rabain: Thank you, and good morning, Mr. Speaker. Good morning, colleagues, and good morning, Bermuda.
UNIVERSITY OF THE WEST INDIES ( UWI) SCHO LARSHIP OFFERINGS
Hon. Diallo V. S. Rabain: Mr. Speaker, it gives me great pleasure today to rise and give notice of the r enewal of the relationship between the Bermudian people and the University of the West Indies. Starting immediately, the Ministry of Education will provide scholarship opportunities for Bermudian students to attend the University of the West Indies. Mr. Speaker, the Bermuda Government is serious about seeing the relationship between Bermuda and the University of the West Indies grow. As a result, the Ministry is dedicating $35,000 from our current scholarship budget to assist students in attending one of the three University of the West Indies campuses. This funding will cover 80 per cent of the educational expenses of students, with the student paying the remaining 20 per cent. Applications for this scholarship are being accepted from now up until July 26th for the 2019 fall term, with additional information on the application process to be found on the MOED [Ministry of Education] website. Mr. Speaker, the University of the West I ndies, or UWI, has three main campuses across the Caribbean with locations in Cave Hill; Barbados; Mona Campus in Jamaica; St. Augustine in Trinidad and Tobago; and more recently, the Open Campus, an online campus which services the remaining Englishspeaking islands. They offer courses at the undergraduate and graduate levels in a wide variety of fields, with m edicine having been a popular course for students to take in the past. However, medicine is not the only area for students, with fields such as science and technology, engineering, the social sciences, and humanities and education being areas of focus. UWI has had a long relationship with Berm uda, as Bermuda has been an associate country mem-ber of UWI since 2010. Although we have had st udents attend UWI over this period, the number of st udents has not been consistent, and this is something that the Ministr y of Education and the University of the West Indies are seeking to change. Mr. Speaker, Sir Hilary Beckles, ViceChancellor of the University of the West Indies, r ecently visited Bermuda, and we discussed how we could encourage our Bermudian students to take advantage of the preferred pricing we currently enjoy as an associated country. As a result of these and ong oing discussions, the Ministry of Education is happy to announce that a scholarship provision will be made to sponsor what we anticipate could be at least three students to attend the UWI this fall.
Bermuda House of Assembly Mr. Speaker, I recognise that, to some, it may be considered late in the year to be applying to a un iversity; in fact, UWI’s registration date closes June 30th. I am pleased to let this Honourable House and the public know that the University of the West Indies has extended its application deadline for Bermudian students to attend class this academic year to August 9th, because they want to see our Bermudian students thrive and expand their knowledge. This extension, Mr. Speaker, is an example of the great relationship between the Bermuda Gover nment and the University of the West Indies, a relatio nship that we will continue to nurture. Mr. Speaker, the Ministry of Education r emains dedicated to creating new opportunities for our students to pursue their educational goals. This means thinking outside the box and revisiting pre-existing relationships, such as this one, to make them more applicable to our needs today. I want to take this opportunity t o thank the Bermuda College, Ministry staff and Sir Hilary Bec kles, who has worked diligently to make this opportunity a reality for our students. These efforts will have a huge impact on, hopefully, at least three students’ f uture now and many more in the years to come. Thank you, Mr. Speaker.
[Desk thumping]
The SpeakerThe SpeakerThank you, Minister. REPORTS OF COMMITTEES
The SpeakerThe SpeakerThere are none. QUESTION PERIOD
The SpeakerThe SpeakerWe have two written questions before we get to the Statement. And the first written question, I believe, is in the name of the Premier. And it was for an oral and written response, I believe. Premier. Hon. E. David Burt: Good morning, Mr. Speaker, and you will forgive me, …
We have two written questions before we get to the Statement. And the first written question, I believe, is in the name of the Premier. And it was for an oral and written response, I believe. Premier. Hon. E. David Burt: Good morning, Mr. Speaker, and you will forgive me, as I do not have the Standing O rders in front of me. I did send an email to both your-self and the Leader of the Opposition indicating that I will move that the House defer the answers to the question until the next day of sitting, as we want to make sure that we are providing complete and acc urate information t o the House.
QUESTION: LIST OF MPs PAID TO SERVE ON GOVERNMENT COMMITTEE, BOARD OR QUANGO [Deferred]
Hon. L. Craig Cannonier: Will the Honour able Premier please inform this Honourable House of the names of all the Members of the Legislature from July 20 17 until present who have been paid to serve on any Government Committee, Board or Quango and the remuneration paid for that service?
The SpeakerThe SpeakerThank you. Opposition Leader, are you in agreement? Fine. The next written question this morning is to the Minister Furbert from the Honourable Member Gordon- Pamplin. Honourable Member, yours was for a written response . Have you received your r esponse? Hon. P atricia J. Gordon -Pamplin: Yes, Mr. Speaker, …
Thank you. Opposition Leader, are you in agreement? Fine. The next written question this morning is to the Minister Furbert from the Honourable Member Gordon- Pamplin. Honourable Member, yours was for a written response . Have you received your r esponse?
Hon. P atricia J. Gordon -Pamplin: Yes, Mr. Speaker, I have the response. Thank you.
QUESTION: EFFICIENCY COMMISSION, $130,000 COST, BREAKDOWN OF
Hon. Patricia J. Gordon -Pamplin: Will the Honourable Minister please provide this Honourable House with a detailed breakdown of the $130,000 costs for the Efficiency Co mmission, specifying recipient, date of each i nstalment and the purpose for which the di sbursements were made?
The SpeakerThe SpeakerThank you. [Inaudible interjections ]
The SpeakerThe SpeakerMembers! The next question this morning, or being that we have dealt with the written questions, we will now move on to the questions from Statements. Minister of Education, there is one Member who has indicated that she would like to put a question to you in reference to your …
Members! The next question this morning, or being that we have dealt with the written questions, we will now move on to the questions from Statements. Minister of Education, there is one Member who has indicated that she would like to put a question to you in reference to your S tatement this mor ning. And that is the Member from constituency 19. Honourable Member, would you like to put your question?
Hon. Jeanne J. Atherden: Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you. QUESTION 1: UWI SCHOLARSHIP OFFERINGS Hon. Jeanne J. A therden: Mr. Speaker, through you to the Honourable Minister: I was intrigued when it is indicating that $35,000 is going to be dedicated from the scholarship budget, but that you would be able to get three scholarships. Could you …
Thank you.
QUESTION 1: UWI SCHOLARSHIP OFFERINGS
Hon. Jeanne J. A therden: Mr. Speaker, through you to the Honourable Minister: I was intrigued when it is indicating that $35,000 is going to be dedicated from the scholarship budget, but that you would be able to get three scholarships. Could you perhaps indicate to this House what is the range of the tuition at this particular un iversity?
1850 21 June 2019 Official Han sard Report
Bermuda House of Assembly The Speaker: Thank you. Minister, would you like to respond?
Hon. Diallo V. S. Rabain: Thank you, Mr. Speaker. Mr. Speaker, first I would like to [preface] the answer by stating that the University of the West I ndies is ranked in the top 5 per cent of all universities worldwide. And because of our relationship–– which unfortunately has not been promoted in the past ––we enjoy preferential pricing on the courses. And when we looked at the average course per year, including room and board, it can range from around $9,000 to $11,000. So, that is where we get the idea of, potentially, three scholarships using $35,000.
The SpeakerThe SpeakerThank you. Supplementary? Further question? Hon. Jeanne J. Atherden: Supplementary.
The SpeakerThe SpeakerSupplementary. Continue. SUPPLEMENTARY Hon. Jeanne J. Atherden: The second part of my question is, that $9,000 or $11,000 relates to the tu ition. Is there anything that is covered in terms of housing accommodation? Because, obviously, that is what makes . . . [Inaudible interjections]
An Hon. Member An Hon. MemberHe just said it.
The SpeakerThe SpeakerHe included it in his statement. Hon. Jeanne J. Atherden: Oh, sorry. I did not hear that.
The SpeakerThe SpeakerIt does cover that. So, you are wit hdrawing your supplementary? No further supplementaries from anyone else? That brings us to a close of the questions this morning. ANNOUNCEMENT BY THE SPEAKER HOUSE VISITOR
The SpeakerThe SpeakerBefore I acknowledge the first Member on his feet, which i s Member Swan . . . before I acknowledge you, I would just like to acknowledge in our Gallery this morning, we have a visiting mayor. We have the Mayor from Delaware. Mr. Jerry Clifton, is it? Welcome to …
The SpeakerThe SpeakerThank y ou. Good. Thank you. Mr. Swan, you have the floor. CONGRATULATORY AND/OR OBITUARY SPEECHES
Mr. Hubert (Kim) E. SwanGood morning, Mr. Speaker. Mr. Speaker, I would like for a suitable letter of congratulations sent through MP Renee Ming for the 13th holding of the Dame Jennifer Smith Future Leaders Awards ceremony, for which I was proud to be the master of ceremonies. And I would like to associate …
Good morning, Mr. Speaker. Mr. Speaker, I would like for a suitable letter of congratulations sent through MP Renee Ming for the 13th holding of the Dame Jennifer Smith Future Leaders Awards ceremony, for which I was proud to be the master of ceremonies. And I would like to associate Lt. Col. Minister Burch and MP Furbert, Tinee Furbert, who were there. This event, as I mentioned, is an annual event which honours some eight students from four schools in our region in the St. George’s community. And the students are chosen by their principal. I would just like to acknowledge East End Primary for Desiria Smith -Robinson; DeNunjay Om ara; Jela y Carlington, from St. George’s Prep; Riley Darrell, from St. David’s Primary; Jade Richardson and Samoree Place; and Clearwater Middle School, Malaysia Roberts; and Eyre Cannonier, the grandson of our very own Minister Foggo. The keynote speaker, Ms. Bria nna Bean, delivered a very fitting keynote a ddress to the young people, and kept it real and made a real connection. The most outstanding thing about this is the celebration of young people achieving and the impact that they have on their peers. On a much sadder note, Mr. Speaker, I would like a suitable letter sent to the family of Carolyn “Cookie” (DeRosa) Dill, a relative of mine and next - door neighbour of mine from Granaway [Lane], Southampton, connected to me through the Halls. Her father and my grandmother, Ivy Hall Anderson, were siblings. And she was laid to rest yesterday. And I would just like a suitable letter sent, if possible, to her family. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Minister for Works. You jump pretty quick now that you have got your cast off, right?
Lt. Col. Hon . David A. BurchThank you, Mr. Speaker. Bermuda House of Assembly I would ask to be associated with the congratulations for the Dame Jennifer Smith Future Leaders Award. Mr. Speaker, I would also ask that congratul ations be sent to two schools that had their graduations last we ek, Thursday. I wish there …
Thank you, Mr. Speaker.
Bermuda House of Assembly I would ask to be associated with the congratulations for the Dame Jennifer Smith Future Leaders Award. Mr. Speaker, I would also ask that congratul ations be sent to two schools that had their graduations last we ek, Thursday. I wish there would be some coordination––well, one is a private school, so I cannot even speak to the Minister of Education–– because I was on skates. First, the Grade A class of 2019 at Bermuda Institute, who were graduated last week, Thurs day. One of them was my great -niece, Mr. Speaker, who, I am very proud to say, was graduated with highest honours, she and one other student. But what was also interesting, Mr. Speaker, and I had no influence over this, and I declare and decree that she was the Parliamentarian for the class. And we have had no discussions on that matter whatsoever. So, I do not know if she took a page out of probably her granny’s book as opposed to mine. But I would ask that congratulations be sent to the entire class. One of the things that stood out, Mr. Speaker, and it stands out for both graduations —and I will get to the second one in a minute —is that the students just spoke with such clarity and authority and convi ction. And it was just amazing. And very encouraging to see that, clearly, part of their learning is public speak-ing. And they all did it exceptionally well. Mr. Speaker, I would also like for congratul ations to be sent to Primary 6 at West Pembroke School, who graduated last week, Thursday, as well. And ther e I have now two little people who are connected to me, one of whom graduated on that occ asion. But the highlight of that graduation— two highlights, actually, Mr. Speaker. There are many, but two I wish to highlight today. One was that virtually every student participated, and they did, the entire class participated, in some shape or form, in the presentation during the graduation. How much time have I got left?
Lt. Col. Hon. David A. BurchForty seconds. Anyway, they all spoke from memory, not the written word, and did an amazing job. And finally, Mr. Charles Richardson was the guest speaker. And his message was really to them. And I think it resonated with them, and I would ask that congratulations be sent to them. …
The SpeakerThe SpeakerYou have still got 20 left, you know.
The SpeakerThe SpeakerThank you, Minister. We recognise the Honourable Member from constituency 24. Honourable Whip.
Mr. W. Lawrence ScottThank you, Mr. Speaker. I would just like to have the House send a letter of congratulations to the new Councillor of St. George’s, Councillor Nyon Dowling. And I do have to [declare] my interest, as he was my university roommate and also high school cl assmate, as well. I …
Thank you, Mr. Speaker. I would just like to have the House send a letter of congratulations to the new Councillor of St. George’s, Councillor Nyon Dowling. And I do have to [declare] my interest, as he was my university roommate and also high school cl assmate, as well. I will associate the Members from constitue ncies 1 and 2. And also, the fact that I think it is going . . . and I do not know St. George’s history as well as I know Somerset’s. But his brother is the Mayor of St. George’s, George Dowling. And I wanted to congrat ulate both of them, if that has not been done already. But also, Mr. Speaker, last night . . . I would like for a letter of congratulations to be sent to . . . even though their tour or their time and their cap is not over, they s till have one more game left, I still would like a letter of congratulations to go to Bermuda Men’s Football Team in the Gold Cup, as they represented the country very well last night. They punched well above their weight. And even if you were listening t o the comme ntators, the commentators were impressed. The commentators had a new respect. And they started, bas ically, sharing about how we were punching above our weight. We played better than members expected, and we got results. We got results. We got respect from the other team. And I feel as though we had Costa Rica on the back foot. Although it is not the outcome that we had expected or that we wanted, I b elieve that our men should be very proud, and the country should be proud of our national team and the way that they are conducting themselves, playing and representing the country. Thank you very much.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Member from constituency 11. Honourable Member, good morning.
Mr. Christopher FamousGood morning, Mr. Speaker. Good morning, colleagues, and good mor ning, Bermuda. Mr. Speaker, I want to firstly thank the— give congratulations to the Minister of Education for rene wing the ties to UWI (University of the West Indies). It is somethi ng that is very worthwhile. And we, as …
Good morning, Mr. Speaker. Good morning, colleagues, and good mor ning, Bermuda. Mr. Speaker, I want to firstly thank the— give congratulations to the Minister of Education for rene wing the ties to UWI (University of the West Indies). It is somethi ng that is very worthwhile. And we, as Berm udians, should be attending UWI. I also want to congratulate the staff of Elliott School for the graduation ceremony. Twenty -three young persons graduated yesterday. Mr. Speaker, on a sad note, I want to give condolences to the family of Reverend Williams E ugene Mac Donald Joell, a constituent of constituency 11 and originally from Back o’ Town. Also, Mr. Uel Armstrong, originally from Hermitage Road. 1852 21 June 2019 Official Han sard Report
Bermuda House of Assembly And lastly, Mr. Speaker, Mrs. Dorothy Ball, nee Holdipp, who passed away. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Member from constituency 16, the Honourable Member Weeks.
Mr. Michael A. WeeksThank you, Mr. Speaker, and good morning to you. Good morning, c olleagues. Mr. Speaker, I would like to start off my r emarks by associating myself with the remarks by the Member who just took his seat, for the loss of Mr. Uel Armstrong. He was a family member …
Thank you, Mr. Speaker, and good morning to you. Good morning, c olleagues. Mr. Speaker, I would like to start off my r emarks by associating myself with the remarks by the Member who just took his seat, for the loss of Mr. Uel Armstrong. He was a family member of mine and a good friend. We worked for many years together, on top of that. So, he is going to be a great miss. My condolences go out to his two sons, Tyree and to Damir. Mr. Speaker, I would also like to be associated with the remarks by the Member from constituen-cy 24, with the team that is currently playing the Gold Cup. They are definitely punching above their weight, Mr. Speaker. And we have to show our national pride and our support of our teams when they go to repr esent us. So, let us not forget when they return to Bermuda next week to go down there and s how our su pport. Mr. Speaker, I would also like to send some congratulatory remarks to the organisers of the 75 th Edward Cross Long Distance Comet Race weekend. I would like to associate the MP from constituency 2. Mr. Speaker, these remarks and these cel ebrations started last Thursday, [at the] East End Mini Yacht Club. And I got a real history lesson, Mr. Speaker. They talked about the first yachting club in Bermuda was actually called Native . . . I cannot remember the name of it right now, Mr. Speaker. It has left me.
Mr. Michael A. WeeksYes, it is a senior moment. But it was formed by freed slaves in 1854, Mr. Speaker. And the reason that we are celebrating the Edward Cross Long Distance Comet Race is b ecause, apparentl y, he was the person who made the cup for what they raced for. And …
Yes, it is a senior moment. But it was formed by freed slaves in 1854, Mr. Speaker. And the reason that we are celebrating the Edward Cross Long Distance Comet Race is b ecause, apparentl y, he was the person who made the cup for what they raced for. And I think the Minister from constituency 6 . . . or 5, actually , is his nephew. He is Edward Cross’s nephew, Mr. Speaker.
Mr. Michael A. WeeksSo, with those remarks, Mr. Speaker, I would like for us to understand it was H eroes Weekend. I would like to wish you a happy belated Heroes Weekend, happy belated Father’s Day, Mr. Speaker —
The SpeakerThe SpeakerWould any other Member wish to speak? I recognise the Honourable Member, Mr. S imons, right here next to me. Mr. Simons, you have the floor.
Mr. N. H. Cole SimonsThank you, Mr. Speaker. I would like to send congratulatory remarks to Jason Sukdeo and his team for the Bermuda Heroes Weekend events. The carnival was enjoyed by many, many people, locals and foreign guests alike. It is supposedly one of the fastest -growing carnivals going. So, I wish him …
Thank you, Mr. Speaker. I would like to send congratulatory remarks to Jason Sukdeo and his team for the Bermuda Heroes Weekend events. The carnival was enjoyed by many, many people, locals and foreign guests alike. It is supposedly one of the fastest -growing carnivals going. So, I wish him all the best and continued success for him and his t eam in the future. I would like to also send condolences to the late Beverley Pitt. I have known Beverley Pitt for a number of years. And it was interesting. At her funeral, I thought I knew her until I heard the tributes. And I said to myself, Well, I di dn’t know her well at all, once I heard the tributes that came from the people. And what struck me the most were the tributes from young men, 20– 30 year olds, who paid support. Beverley was the trailblazer for the early taxi driver, and she also did commer cial painting. So, I would like to send condolences to her family. I would like to also associate myself with the comments made in regard to Carolyn “Cookie” DeR osa Dill. She was a friend of my mother’s. In addition, I worked with her for a number of year s. And she was always a lady, very helpful, very pleasant and a joy to work with. So, I wish her family my deepest sympathies. And I hope that her loving memory lasts forever. That is all I have, Mr. Speaker. Thank you.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Member from constituency 19. You have the floor. Hon. Jeanne J. Atherden: Thank you, Mr. Speaker. Mr. Speaker, I would like to be associated with the remarks on the condolences to be sent to the family of the late Rev erend Eugene …
Thank you, Honourable Member. I recognise the Honourable Member from constituency 19. You have the floor.
Hon. Jeanne J. Atherden: Thank you, Mr. Speaker. Mr. Speaker, I would like to be associated with the remarks on the condolences to be sent to the family of the late Rev erend Eugene Joell. Mr. Joell, as I knew him at that point in time, was a very longserving member, an employee of the hospital when I was Director of Finance. And he was one of those individuals who was so very diligent and took some great care of his [late] daughter Belinda. And so, I know that he was a man who was very committed. And I was very saddened to hear of his passing. Similarly, I would like to be associated with the remarks that were sent to Jason Sukdeo and any of those persons who were assoc iated with the Devil’s Isle J’Ouvert. I am not going, myself, but knowing people who actually went —
An Hon. Member An Hon. MemberJoo- vay Bermuda House of Assembly Hon. Jeanne J. Atherden: Joo-vay, Sorry, I should say Joo-vay, even though it is spelled there. Joo- vay. I must admit, I realise that for all those people who went, they seemed to have had a good time, starting from Thursday all the way …
Joo- vay
Bermuda House of Assembly Hon. Jeanne J. Atherden: Joo-vay, Sorry, I should say Joo-vay, even though it is spelled there. Joo- vay. I must admit, I realise that for all those people who went, they seemed to have had a good time, starting from Thursday all the way to Monday. So, it is very much growing, and it is getting the type of r esponse that I think Bermuda wanted in terms of the numbers of persons who a re coming. I did hear some persons talking about the numbers of persons who were coming from abroad. And I guess we have to start recognising that, for our overseas visitors, we are going to have to pay some more special attention to their needs. And with respect to the Gold Cup, I would like to be associated with the remarks with respect to our team. I stayed up last night to actually watch the match. And I was very much on the edge of my seat when those near misses were going by. But I would like to think that, as the Member across the aisle said, we had so many congratulatory remarks made about how much we were punching above our weight. But I also think it reminded me that, as we get used to being on the world stage, I do not believe that we will be quite so intimidated by the fact that we are there. And we will start to be using the qualities and the skills that I believe we have. Because once you start knowing that you are good, you will exercise and you will have some more of those things saying, I ca n do it. I can do it. So, I am looking forward to seeing the Nicaragua match. And I am sure that we will be successful. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Member from constituency 28. Honourable Member, you have the floor.
Mr. Dennis Lister IIII would like for condolences to be sent to the family of Ms. Katherline Millicent Francis, a constituent of mine, in her 91 st year, of 5 Sun Valley Road. So, yes, we would like to send condo-lences to her family. Also, I would like to associate myself with some …
I would like for condolences to be sent to the family of Ms. Katherline Millicent Francis, a constituent of mine, in her 91 st year, of 5 Sun Valley Road. So, yes, we would like to send condo-lences to her family. Also, I would like to associate myself with some of the comments made earlier regarding the Edward Cross memorial Comet Race. Congratulations to the winner, Mr. Dale B rangman, and young 12 - year-old Tarjari Rogers, who was co- pilot along with him. Also, I would like to associate myself with the comments about the Bermuda National Team. Even though we did not get the results we wanted in the two games, it was the perform ances that really stood out. In both games, we held our own. We pushed them right to the end. And no one could say that Bermuda was overwrought by the experience. And hopefully, in our third game on Monday, at which I will be in attendance, we can get a vi ctory —our first at the Gold Cup. Also, [I would like to] associate myself with the comments [about] the carnival over the weekend. I would like to send congratulations to the organisers, Mr. Sukdeo and his group. Also, not just for holding and hosting a w onderful event, which I attended a number of the events over the weekend, but also, as stated by my colleague on this side, the Honourable Ms. Jackson, the number of —not Ms. Jackson, Ms. Atherden ––the number of overseas guests who have come. Each year, in the five years that this has been going on, we have seen an increase in numbers. So, it is a testament to the product that we are putting on, which is growing overseas visitors. And also, on another heading, along with the carnival weekend, as the Road Safety Chairman, I would just like to send congratulations to all of those who attended these events, and that they were able to make use of sponsored minibus transportation to these events. And we saw a safe and enjoyable weekend at which we were all able t o have fun, and also celebrated Father’s Day. Thank you, Mr. Speaker.
The SpeakerThe SpeakerWe recognise the Honourable Minister for Education. Honourable Minister, you have the floor. Hon. Diallo V. S. Rabain: Thank you, Mr. Speaker. Mr. Speaker, I would like t his House to send congratulations to the graduates of Success Academy, who passed out yesterday. Mr. Speaker, Success Academy is an alternative …
We recognise the Honourable Minister for Education. Honourable Minister, you have the floor.
Hon. Diallo V. S. Rabain: Thank you, Mr. Speaker. Mr. Speaker, I would like t his House to send congratulations to the graduates of Success Academy, who passed out yesterday. Mr. Speaker, Success Academy is an alternative education programme in which, sometimes, we have students who just do not respond to the traditional ways of teaching. And we have these special programmes for them. I was very moved by watching Mr. Scott Dean and Mr. Kenyade McQueen graduate. It is a special case of Mr. McQueen, as he is graduating with his Penn Foster diploma, which is an alternative pathway to graduation that has been put in place by the D epartment of Education, as we identify the children who learn differently, and as we are putting additional pr ocesses in place for them to achieve educational achievement. As a result of these two young men graduating from Success Academy, I have pledged the Mini stry of Education to include them in our College Promise programme. Our College Promise programme, Mr. Speaker, is for any students who achieve the appr opriate GPA to be able to attend the Bermuda College, tuition -free. So, these two young men–– both of whom want to attend the Bermuda College, one wants to study culinary arts; the other one wants to become an electrician —will be able to attend the Bermuda College this fall, and should be enrolled tuition- free, Mr. Speaker. Thank you. 1854 21 June 2019 Official Han sard Report
Bermuda House of Assembly The Speaker: Thank you, Honourable Member. I recognise the Honourable Member from constituency 23. Honourable Member GordonPamplin, you have the floor.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Speaker. Mr. Speaker, on a very sad note, I would ask that this Honourable House join me in sending a note of condolences to the family of the late Nadine MappHawkins. Nadine was a very young woman, who ac-tually was in the same class at Berkeley as my youngest sister. And she met her untimely death abroad. And I would like for her family to know that they are in our thoughts and prayers. On a happy note, Mr. Speaker, over the weekend, over the Heroes Weekend, the Department of Labour, Community and Sport held a celebration of the heroes who had previously been inducted. It is known that we did not have a new hero to be inducted for this year 2019. However, they did something di fferent for this year in recognising not just the heroes who had previously been inducted, but to invi te the members of the families to give personal tributes on their interaction with the people who were National Heroes and how those heroes have impacted their lives. I have to declare my interest, Mr. Speaker, inasmuch as my father, the late Dr. E. F. Gordon, is one of our National Heroes. And I did have the priv ilege and the pleasure of being able to present on behalf of my family a personal tribute. But all of the N ational Heroes, Gladys Morell, Sir Edward Richards, Pauulu Kamarakafego, Sir John Swan and (who am I missing?), E. F. Gordon, Dame Lois Browne- Evans, who was the very first National Hero. And I think I am missing one . . . oh, Mary Prince, Mary Prince. And every either member of the family or a designated individual was required to give a present ation. And everybody’s presentations were absolutely well received. And I am sure that the Deputy Premier would want to be associated with these remarks, as he was in attendance and had the opportunity to greet the members of the families who were actually pr esenting on behalf of the National Heroes. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. I recognise the Honourable Member Moniz. You have the floor. Hon. Trevor G. Moniz: Thank you, Mr. Speaker. I do not believe this one was done. Two weeks ago, on the 4 th of June, there was the cocktail reception for the book launch by Dr. …
Thank you, Honourable Member. I recognise the Honourable Member Moniz. You have the floor.
Hon. Trevor G. Moniz: Thank you, Mr. Speaker. I do not believe this one was done. Two weeks ago, on the 4 th of June, there was the cocktail reception for the book launch by Dr. Clarence Maxwell of his new book Prudent Rebels. [Inaudible interjections ] Hon. Trevor G. Moniz: I associate the whole House with that. The point I wish to make, I had a conversation with Minister Foggo about this, is that there was a fine cocktail reception at the museum on the 4 th of June. And then, on the 6th, there was a lecture at Bermuda College, which may have been mentioned. The lecture at Ber muda College was an excellent lecture and was filmed. And I am encouraging the Government to put that up on YouTube, as well as putting it on CITV. I would also like to give credit to Dr. Theodore Francis II, who is the co- author, and Alexandra Mairs - Kess ler, who is the other co- author of that. In addition, I would like to congratulate Vasco De Gama [Club] on their Portugal National Day cel ebrations that they held on Saturday, the 8th of June. The Deputy Premier was present at that, as was Mi nister Foggo. And it was a fine reception. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. Does any other Honourable Member wish to speak? I recognise the Honourable Member Tyrrell. You have the floor.
Mr. Neville S. TyrrellGood morning, colleagues. Mr. Speaker, I will start off on a sad note and ask if condolences could be sent to the family of the late Donald Hamilton Gray Smith, better known as “Donnie,” who was a friend of the family for a long, long time. I have known Donnie. …
Good morning, colleagues. Mr. Speaker, I will start off on a sad note and ask if condolences could be sent to the family of the late Donald Hamilton Gray Smith, better known as “Donnie,” who was a friend of the family for a long, long time. I have known Donnie. In fact, I can reme mber his days as a talented footballer for the now - defunct Dock Hill Rangers. And I always tried to em ulate him, but I only had one foot, not two feet, at the time. So, I do ask that condolences be sent to his fa mily and hope that he rests in peace. Mr. Speaker, on a happier note, I wish to be associated with the congratulations to Mr. Jason Sukdeo, whom I know personally, for his efforts in putting together . . . I am not really a carnival person. So, I am not overly involved in that. But I certainly know the effort that he put in and has put in over the last five years in putting on the carnival. And I do under-stand—I associate my colleague, Honourable Rolfe, constituency 21—the effort that he has put in to have it grow over the last five years. And I certainly wish him much more success. Lastly, I would like to be associated with the congratulations to the Bermuda Football Association. And I will declare my interest as a past president of the football association and say that Bermuda certai nly is now playing well above its weight. But it is som ething that was planned way back for us to reach this
Bermuda House of Assembly stage. People may not know what goes on behind the scenes i n getting a national team to this level. But it is well-deserved. And I certainly wish them all the best, even though the last game they have to play is bas ically a formality, but I do see a win in that last game for them. Thank you, Mr. Speaker.
The Spe aker: Thank you, Honourable Member. I now recognise the Honourable Member from constituency 36. Honourable Member Scott, you have the floor.
Hon. Michael J. Scott: Good morning, Mr. Speaker. Mr. Speaker, I would like to ask that this Honourable House pl ease send a letter of condolences to the family of Ms. Ismay Bean of West Side Road in Somerset.
The SpeakerThe SpeakerYes. Yes. Hon. Michael J. Scott: May I associate the Honour able Minister of Health, Minister Wilson, and yourself, Mr. Speaker, if I may. The S peaker: Thank you. Hon. Michael J. Scott: Ms. Bean was a mother and faithful member of the Allen Temple AME Church. And she passed …
Yes. Yes.
Hon. Michael J. Scott: May I associate the Honour able Minister of Health, Minister Wilson, and yourself, Mr. Speaker, if I may.
The S peaker: Thank you. Hon. Michael J. Scott: Ms. Bean was a mother and faithful member of the Allen Temple AME Church. And she passed away just recently. And so, to her chi ldren, Jolene and Pat and Maria, I would like them to know that they have the condolences of the House, and are in our thoughts and prayers, and that Mem-bers wishing to be associated include Mrs. GordonPamplin, and Mr. Cole Simons. Mr. Speaker, I want to be associated with the congratulations offered to the participants of that magnificent regatta that has been taking place for 75 years at the crossing. This year, the proceedings began from the West End Sailboat Club. And we did an excellent job at hosting the preparation. I was happy to see you there, Mr. Speaker, for the starting horn for that race. This year, the enthusiasm was high. When we were there, Mr. Speaker, I know that we both saw a number of young sailors there.
The SpeakerThe SpeakerYes. Hon. Michael J. Scott: And it bodes well for the r egatta in that it will have a future. So, it went off very well. And I commend all three placers. First, second and third were St. Geor-gians. So, I want Member, Ms. Ming, to know that I stood …
Yes.
Hon. Michael J. Scott: And it bodes well for the r egatta in that it will have a future. So, it went off very well. And I commend all three placers. First, second and third were St. Geor-gians. So, I want Member, Ms. Ming, to know that I stood and commended the people from the east on this matter. Thank you.
[Inaudible interjections ]
The SpeakerThe SpeakerNot this year. Not this year. Would anyone else like to speak? No other speakers. We will move on. MATTERS OF PRIVILEGE
The SpeakerThe SpeakerThere are none. PERSONAL EXPLANATIONS
The SpeakerThe SpeakerThere are none. NOTICE OF MOTIONS FOR THE ADJOURNMENT OF THE H OUSE ON MAT TERS OF URGENT PUBLIC IMPORTANCE
The SpeakerThe SpeakerThere are none. INTRODUCTION OF BILLS GOVERNMENT BILLS
The SpeakerThe SpeakerThere are two Bills to be introduced this morning. The first is in the name of the Minister of Finance. Minister, would you li ke to present your Bill? Hon. Curtis L. Dickinson: Good morning, Mr. Speaker.
The SpeakerThe SpeakerGood morning. FIRST READINGS ECONOMIC SUBSTANCE AMENDMENT ACT 2019 Hon. Curtis L. Dickinson: Mr. Speaker, I am intr oducing the following Bill for its first readi ng so that it may be placed on the Order Paper for the next day of meeting: Economic Substance Amendment Act 2019.
The SpeakerThe SpeakerThank you. Minister of Health, would you like to introduce yours? MEDICAL PRACTITIONERS AMENDMENT ACT 2019 Hon. Kim N. Wilso n: Yes. Thank you, Mr. Speaker. I am introducing the following Bill for its first reading so that it may be placed on the Order Paper for the next day …
The SpeakerThe SpeakerThank you. 1856 21 June 2019 Official Han sard Report Bermuda House of Assembly ORDERS OF THE DAY
The SpeakerThe SpeakerJust for the sake of clarity, on our O rder Paper, we are going to adjust the number of items as they are listed. So, the first Order that will be dealt with this morning is the second reading of the Government Loans Amendment Act 2019, which is listed as …
Just for the sake of clarity, on our O rder Paper, we are going to adjust the number of items as they are listed. So, the first Order that will be dealt with this morning is the second reading of the Government Loans Amendment Act 2019, which is listed as [Order] No. 4. But it is going to be [Order] No. 1, in the name of the Minister of Finance. Minister, would you like to present your Bill?
ORDER
GOVERNMENT LOANS (SUSPENSION OF ANNUAL CONTRIBUTION TO SINKING FUND) ORDER 2019 [With drawn, Standing Order 48]
Hon. Curtis L. Dickinson: Thank you, Mr. Speaker. Mr. Speaker, I move that the Government Loans (Suspension of Annual Contribution to Sinking Fund) Order 2019 be withdrawn, according to Standing Order 48.
The SpeakerThe SpeakerJust for clarity for the House, the [O rder] No. 2 listed is actually being withdrawn so we can do [Order] No. 4. [Order] No. 4 will allow . . . or [Order] No. 1, which it is now . . . So, the first order of business was that …
Just for clarity for the House, the [O rder] No. 2 listed is actually being withdrawn so we can do [Order] No. 4. [Order] No. 4 will allow . . . or [Order] No. 1, which it is now . . . So, the first order of business was that the Minister had to remove [Order] No. 2, which he has done. And now we will proceed on to the Second Reading of the Government Loans Amendment Act 2019. Minister.
BILL
SECOND READING
GOVERNMENT LOANS AMENDMENT ACT 2019
Hon. Curtis L. Dickinson: Thank you, Mr. Speaker. Mr. Speaker, the Gov ernment wishes this Honourable House now to give consideration to the Bill entitled the Government Loans Amendment Act 2019. The Bill seeks to amend the Act to provide the Minister of Finance with discretion with respect to making the Sinking Fund contribution. Mr. Speaker, effective 31 st of March 1993, the Government Borro wing Sinking Fund [GBSF] was established as a sep arate legal entity for the repayment of government borrowing under the provisions of the Government Loans Act 1978. During each financial year, the Consolidated Fund of the government is required to pay to the GBSF 2.5 per cent of the gross public debt outstanding in the Consolidated Fund at the end of the prece d-ing financial year, fiscal year. Mr. Speaker, Honour able Members may recall that, due to the prolonged economic conditions prevailing from the 2008 recession, the Government amended the Government Loans Act 1978 in 2009 to provide the Minister of F inance with additional capacity to respond to economic conditions that could impair th e government’s tax yield. One of the changes made enabled the Minister of Finance to postpone the annual contribution into the Sinking Fund, while another amendment provided for the Minister to determine that the interest expense on long- term public debt be paid from the Sinking Fund, if necessary. The assets of the Sinking Fund are invested in accordance with the Public Funds Act 1954. And they are shown as a reduction of debt issued on the Consolidated Fund’s Statement of Financial Position. The assets are currently invested in US Government and Agency securities, investment -grade corporate securities and money market funds. The primary o bjective of the investment strategy of the assets in the Sinking Fund is principal protection. The one- year r eturn on t he fund, as of the 31 st of March 2019, was 2.63 per cent. As of the 31st of March 2019, the Sinking Fund balance was $219.2 million. During the 2019/20 fiscal year, $180 million of the monies in the fund will be used to repay two tranches of maturing priv ate placement notes. These repayments will reduce our annual interest costs by $12.1 million and lower our weighted average cost of borrowing from 4.591 per cent to 4.437 per cent, or a reduction of 15.4 basis points. Mr. Speaker, I am pleased to advise this Ho nourable House that on the 21st of May 2019, Gover nment repaid $100 million of private placement notes that had matured. This action reduced our gross debt by $100 million. But the net debt remained unchanged, as the balance in the Sinking Fund was used to fund the repayments of the notes. Mr. Speaker, in uncertain times, fiscal rules must accommodate volatility and the funds available for future budgets. Sluggish international growth may contribute to limit Bermuda’s ability to increase GDP, generate or sustain employment opportunities and increase government revenue to support the provision of services. On occasions, there is a financing gap between the stimulatory policies that we would like to see in place to protect jobs and the policies that we can finance from revenues. Governments must either borrow funds to bridge this funding gap, or they must cut spending to accommodate actual revenues. Spending reductions ultimately result in public sector downsizing, which could create weakness in the pr ivate sector. Mr. Speaker, over the last decade and a half, Bermuda has experienced recurring budget deficits and a growing national debt, coupled with periods of negative economic growth. Significant attention has been focused on our approximately $2.5 bi llion of
Bermuda House of Assembly debt, with calls to reduce expenditures, deficits and, consequently, the debt. The Government is mindful of the effects of the debt burden on the country’s fiscal posture and is taking the necessary steps to prudently manage our debt through strat egic refinancing d esigned to lower interest costs, extend maturities and reducing debt while providing the Government with the space to execute on its fiscal growth strategy. Mr. Speaker, for the record, successive go vernments have been committed to the S inking Fund. And from March 2011 to March 2018, Government has contributed $407.3 million into the fund. Given that during these periods the Government was running deficits, we have had to borrow money to make the statutory contributions to the fund and al so pay the required interest on this debt. Or, it can otherwise be described as “ borrowed savings. ” Furthermore, during this period, the average rate of interest on these bor-rowed funds was higher than the rate being earned from the Sinking Fund investment s. Mr. Speaker, as announced in the 2019/20 Budget Statement, due to the uncertainty facing the Bermuda economy, mainly in relation to the unknown impacts of the implementation of Bermuda’s Economic Substance regime, the Ministry of Finance reco nsidered the Government’s fiscal strategy for the 2019/20 budget as laid out in its pre- budget report. Accordingly, as announced, the Government decided to suspend the mandatory annual contribution to the Sinking Fund rather than borrow additional monies to make th is annual contribution. This decision was made in light of the following factors: 1. Apart from the private placement notes being referenced above, the next maturity of government debt will not occur until 2022. 2. Interest expense associated with borrowi ng to fund the mandatory Sinking Fund contributions will be greater than the investment return generated on those funds, a concept known as “ negative carry. ” 3. Government has forecasted operating surpluses in fiscal 2019/20 and fiscal 2020/21 as set out in the most recent Budget Statement, and it intends to contribute to the Sinking Fund or use [funds from the surpluses] to make open market purchases of its existing indebtedness. Mr. Speaker, the Government Borrowing Sinking Fund is still an important part of the Government’s debt management strategy, as its primary purpose is to be used to repay public debt. Mr. Speaker, the purpose of this amendment is to modernise the Act and provide a level of flexibility in the process to allow Government to make the ap-propriate responses during times of uncertainty. Mr. Speaker, to provide some context, when the Act was drafted in 1993, government was running surpluses and government debt was minimal. Ther efore, the Sinking Fund contributions would have been immate rial as a percentage of the government’s expenditure. In fiscal 2018/19, the $64.2 million contribu-tion represented approximately 5.7 per cent of Government Current Account spending, including debt service. Additionally, the Government has been borrowing t o fund its mandatory contributions to the Sinking Fund. Surely, the policy intent when the Act was drafted was not to borrow funds to place into the Sinking Fund. This legislation effects the policy objectives mentioned above and provides for the followin g: It gives the Minister of Finance the flexibility with regard to making the contribution to the Sinking Fund, prov isions for making contributions to the Sinking Fund, for excess funds borrowed, and the sale of land remains the same, as these are fiscally responsible. The changes to the provision of a government having to make to the Sinking Fund contribution b efore the 30 th of June of each fiscal year —a contribution will now need to be made within the relevant fiscal year. It removes the provision for go vernment having to pay interest to the Sinking Fund for late payments. It makes little sense for government to be paying itself interest. And it allows the Sinking Fund to be used to purchase the government’s public debt. And this would allow the government to then cancel any of the notes that it purchases without paying the make- whole provisions. It repeals the power of the Minister to suspend contributions to the Sinking Fund, as this provision is no longer needed. And it provides that this amend-ment applies to the current fiscal year, being that no contribution is to be made to the Sinking Fund. Mr. Speaker, we have discussed the suspension of the Sinking Fund with the credit rating age ncies, and while they recognise that the Sinking Fund is a positive feature of Bermuda’s credit profile, as it r educes liquidity risks, they have noted that, from a credit standpoint, its effectiveness is limited because government transfers to the fund were financed by the incurrence of new debt. Furthermore, on account of liability management operations conducted by the Government in r ecent years, which have extended our debt maturities, the immediate need of the Sinking Fund is reduced. One agency noted the following, and I quote: “The Sinking Fund continues to provide overall credit su pport to Bermuda, as it helps the Government to meet its debt obligations. Nonetheless, should the gover nment continue to post fiscal deficits, pushing debt stocks higher, contributions to the fund will also rise and continue to be mainly financed through additional debt, thus decreasing the fund’s effectiv eness as a savings mechanism.” Mr. Speaker, I trust that I have provided suff icient evidence to support this transformational policy change. And in closing, I wish to assure the public that the Government and this Minister of Finance are se nsitive to the challenges which arise when debt is u nsustainably high, and to reiterate that the Government 1858 21 June 2019 Official Han sard Report
Bermuda House of Assembly has a plan of action to reduce public debt and to guide the country to a sustainable fiscal path. With those remarks, Mr. Speaker, I now we lcome other Honourable Members’ participation. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Does any other Honourable Member wish to speak? I recognise the Honourable Member from constituency 23. Honourable Member GordonPamplin, you have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Speaker. Mr. Speaker, I thank the Minister for his presentation. It is interesting that we are …
Thank you, Minister. Does any other Honourable Member wish to speak? I recognise the Honourable Member from constituency 23. Honourable Member GordonPamplin, you have the floor.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Speaker. Mr. Speaker, I thank the Minister for his presentation. It is interesting that we are here taking this step to modernise, as he has indica ted, the Go vernment Loans Act so that the Sinking Fund becomes a more focal and focused point of what the Gover nment intends to do with its financing. Mr. Speaker, it is my contention that paying debt is the hallmark and part of good fiscal prudence. The idea of having a sinking fund, historically, as the Minister has indicated, arose from a Government’s necessity to create debt in order to sustain its policies while, at the same time, providing for the ability to r epay that debt when it became due out of a fund that was set aside. I hearken back to the March debate that we had on the budget, in which the Government proudly announced that it had balanced the budget for the first time in “X” number of years since, I believe they said, 1993. And it was my comment at that point in time that, in the absence of requiring a contribution to the Sinking Fund, anybody can have a surplus of money when they do not pay their bills. And that, effectively, is what the Sinking Fund caused us to focus on— make sure that whe n you know what your income is, you know what your expenditure needs to be. You need to manage your finances in such a way that you do have extra. Clearly, as the Minister has indicated, with the Government’s inability to manage its processes and its fina ncing in such a way to produce surpluses in the budget, then clearly it does not make sense to have a legal requirement to put money into a sinking fund when that money is not there. So, to borrow money at a higher interest rate to be able to put it into a savings account that is generating a lower interest rate, with a negative interest impact, clearly does not make sense. And we understand that. But there is one thing that I believe we must focus on. And that is that the Government must appreciate that w e have got to cut the suit according to the cloth. And, as the Honourable Member from constituency 2 always says, you must measure twice and cut once. And what we have seen is a reluctance by the Government to be able to curtail its expenditure. So, it is effectively “business as usual.” And then there is no money left over to save. I think that this has got to be the key. We do not want to borrow money at a higher interest rate than we are getting in terms of the i nvestment of income that we are earning. But by the same token, if we do not take the steps to curtail our expenditure and to really tighten our belts, Mr. Speaker, we are going to consistently find ourselves in the situation of having additional debt that we are going to be hard- put to repay. Now, the Minister has indicated that it is his intention, as he mentioned in the Budget Statement, in 2019/20 and 2020/21, to repay some of the money that . . . Oh, and maybe he said 2022. Maybe we will start to repay some of the debt that is outstanding. I think that it is very, very important, Mr. Speaker, to focus on the necessity —the balanced budget and to curtail expenditure. Now, the Minister has constantly, and the Government has constantly criticised us in the Opp osition, suggesting that they cut st affing in order to be able to cut expenditure. And I say, Mr. Speaker, that cutting expenditure from a government perspective does not necessarily entail the reduction of gover nment staff by way of leaving people unemployed. There are things such as entrepreneurial encouragement that the government can do whereby specific segments of the public sector can be encouraged to create a business environment, with government b eing the client, so that the costs of operating certain segments do not fall on the gover nment purse. And that will be able to normalise and regularise what go vernment expenditure will ultimately end up being, without seeing people being put out on the sidewalk and out of work. I think that because our mind- set, historically, has been that go vernment employs people; therefore, they have a job, and therefore, we have got to find the money to pay them. And nothing has been looked at in terms of encouraging that attitude which says, This particular segment . . . we could actually take these members off the books. And they can still have themselves a viable employment opportunity through their own business creation. It may be a novel thought. It is not something that is a comfortable idea, that people . . . if you are accustomed to going to work Monday through Friday working for government and getting a pay cheque at the end of the month, the idea, perhaps the uncertainty of a business start -up at the initial ou tset . . . but the rewards that could be obtained as time goes on, Mr. Speaker, could be immeasurable for people for, number one, not having that dependency and wondering next year, Is this the year that I’m g oing to get cut, because government truly does not have the money ? Or, Can I sustain my own upkeep through the creation and the running of my own co mpany? That is what we need to start to encourage people to do.
Bermuda House of Assembly Mr. Speaker, when our young people come back from college . . . I can remember, if I can use a personal anecdote, my younger son going off to college. His father said to him, You need to go to school, get educated, get your degree, come back and get a job. And my son’s reaction to his dad was, Yeah. Like you, Dad, and have a heart attack in the process. So, the attitude that our young people have is a little bit more liberal in te rms of, they are looking for their own opportunities to be able to sustain them-selves, to create businesses. And that same young man of whom I speak, Mr. Speaker, is now living in Cambodia with a company that he is operating, and the ability to sustain him self in his own business env ironment, and not having taken the advice of his dad to go to school and get educated, come home and get a job and hope for somebody to hand out a pay cheque to you at the end of the week. So, I think that we have to look at em powering our people, Mr. Speaker, in a circumstance in which they can sustain themselves, still be able to live and to be able to adopt a business model that will suit them and their families, and not continue to be a burgeoning responsibility for the Government. So, Mr. Speaker, while I understand what the Minister is trying to do here with this legislation, it is critical for us that we start to look at the methodology by which we can retire the existing debt that exists, that we have. And then we also need to ensure, Mr. Speaker, that we do not continue to dig ourselves into a bigger financial hole. The one thing that a Sinking Fund contribution has done, historically, is to focus. And notwithstanding that as time . . . I think into the early 1990s and into the mid- 1990s, as the Minister indicated, the Gover nment was operating on surpluses. And therefore, it had minimal debt. And therefore, a contribution to the Sinking Fund was not a major challenge at that point in time. In 2009, as the Minister indi cated, there was an amendment to the Government Loans Act to suspend the necessity to deposit money into the Sinking Fund, because that money was not there. And I b elieve from 2009, certainly for the next two years, that attitude of saying that we did not have the money to put into the Sinking Fund was a critical part of the Government’s planning process. Certainly, from 2012 into 2017, notwithstanding that this money was put into the Sinking Fund, it was at a cost. But sometimes, Mr. Speaker, we look at t he cost. And while I say the delta between the borrowing cost and the return on investment cost, which I think the Minister indicated was sometimes averaging out to 4.591 per cent of cost as against a 2.63 per cent r eturn on investment, what we have found, Mr. Speaker, is that you put the money in that account, it forces you to be aware of exactly what it is that you have to work with. And it forces you to start to look at cutting back where you can cut back. We were criticised as a Government, Mr. Speaker , every step of the way by saying that, You cut back on staff. And you cut back on this, you cut back on that. But we were looking to cut the suit according to the cloth. When this Government took over again in 2017, it was like, you know, Just throw ca ution to the wind. Let me just go back. Let’s bring on all the people. Let’s forget about all the savings that had been made during the course of the 2012– 2017 per iod of time. And let me just, you know, bring back ev erybody. Forget about the expenses. Do what we have to do. And get to budget time for 2019/20 and say, We’ve balanced the budget! But there has been no contribution to the Sinking Fund. And while I understand that the Minister would not have wanted to borrow to make that contribution, sometimes you focus on what your responsibility is. And in the absence of that focus, Mr. Speaker, we can continue to just waltz around and tip- toe through the tulips and forget about our fiscal prudence and r esponsibility. So, I believe it is critical, Mr. Speaker, that the flexibility that the Minister has introduced, according to this Bill, obviously is something that must be done because we do not have the financing that we would like. We do not have a superfluous amount of money that is floating around. We had t o consider that the Bill that we are going to be debating in a little while, in terms of the economic substance, was going to create . . . it could, conceivably, have created a negative i mpact on our Bermuda finances and the money that was going to be avai lable and whether companies were going to stay or not. So, I understand that this was a consideration at the time. But I believe that it is critical for us to know that, whatever we do, we have to stick with the premise that paying debt is a part of our f iscal prudence and that we should make sure that we continue to i nfuse a fiscal discipline in everything that the Gover nment intends to do. So, we do not want to see the Government going further into debt and paying money to be able to sustain the debt th at they have by, you know, going into debt to save money to pay off money later on. It also does not make sense to pay interest on the out-standing contribution to the Sinking Fund. For Go vernment pay interest to itself . . . obviously, that is something th at we can certainly support. But I believe that, if I make no other comment today, the importance of fiscal prudence has got to be the methodology by which Government proposes to conduct the people’s business, going forward, so that we will find that we are in a position to pay off whate ver debt exists, to repurchase any public debt that we have out there, Mr. Speaker, and to minimise the n ecessity for payments. This can only be done when we start to look at slimming down our overall expenditure or increasing our economic activity, because that is the other side of it, Mr. Speaker. 1860 21 June 2019 Official Han sard Report
Bermuda House of Assembly We can continue with all the expenses that we have at the moment. But if we do not increase our economic activity to bring more money into the kitty, Mr. Speaker, we are going to find that we are going to be challenged. We are going to be challenged with this problem for time immemorial. And certainly, I know that, from the people of Bermuda, within this last budget, Mr. Speaker, they were taxed and taxed and taxed and taxed. A nd ev erything they looked at . . . we get complaints on a daily basis. We have so many new taxes. We have so many increases in taxes. We have foreign currency purchase taxes which went up. We had land taxes that went up. We had commercial entity taxes that went up. We had, you know, sugar tax that went up. You know, everything went up. And people are complaining about the fact that they have to pay more taxes. Mr. Speaker, the only way that we are going to be able to get money into the government’s kitty i s for there to be tax infusion, or new economic activity. And what we have not seen is . . . we have heard comments about the intent, but we have not seen the intent for economic activity become a reality so that the people of Bermuda can get some kind of relief. So, we need to be able to be pushing as a Parliament, as a country. We need to be forcing ourselves not just to save, but we need to be able to come up with effective budgeting whereby we know exactly what money is coming in, what money we have to spend and how we can be able to salt away some in order to retire the existing debt for the benefit of the people of Bermuda. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. Does any other Honourable Member wish to speak? We recognis e the Honourable Member Moniz. Honourable Member, you have the floor. Hon. Trevor G. Moniz: Thank you, Mr. Speaker. I would like to follow along in a similar vein to my honourable colleague, Pat Gordon- Pamplin. …
Thank you, Honourable Member. Does any other Honourable Member wish to speak? We recognis e the Honourable Member Moniz. Honourable Member, you have the floor.
Hon. Trevor G. Moniz: Thank you, Mr. Speaker. I would like to follow along in a similar vein to my honourable colleague, Pat Gordon- Pamplin. The Minister, in presenting his case from a finance point of view, is being most persuasive in sa ying, Well, it doesn’t make sense putting money aside if you’re borrowing to put it aside, or if you’re paying interest on it and the interest you get on it is less than the interest you pay on your outstanding debt. So, he has made a very convincing case. But, unfortunately, once he makes that case, it is very difficult to imagine a situation when he would see it as appropriate to pay into the Sinking Fund. So, I mean, is he quietly here just getting rid of the Sinking Fund? I mean, he is saying, Oh, well, you know, I’m giving myself greater powers to not pay into the Sink-ing Fund, and it never makes sense to pay into it. But in the future, if I ever think it sensible to pay into it, I’ll pay into it. Well, in what circumstances would the Mini ster say it would make sense to pay into the Sinking Fund? Are there any conceivable, likely circumstances where this Minister of Finance would see that it would be sensible to pay into a Sinking Fund? Some of us , you know, are accused of being old-fashioned, and perhaps we are. You know, people like to keep a little money aside for an emergency for a rainy day. However they keep it, whether in a bank savings deposit, et cetera, you know, clever people would say i t makes no sense. But sometimes, it is useful to have a buffer, so that when you can come along you can make payment on some unexpected circumstance where you have some money. You need money all of a sudden, and maybe the cost of borro wing is high. You nee d the money; you have got it there. You have stashed a bit of money aside for that rainy day. The rainy day comes, and there the money is. So, all those people who said you were terribly foolish for putting any money aside suddenly say, Oh, he was a clever chap. He put some money aside, and he was ready for that totally unexpected circumstance when he needed money suddenly and it would be di fficult to get. So, perhaps the Minister in his response can say w hat exactly the circumstances are when he would see it as sensible to start putting money into the Sinking Fund again? Or, is it a highly unlikely event? The difficulty I have, you know, in the case he makes for this year is the sensible case in the difficult economic circumstances that Bermuda presently fa ces. But we have got to be realistic here. We have an economy in the doldrums. We have had increasing taxes. We have an ageing population. We have had 12 or 13 months of retail sales decline. We have i nsurance companies that are consolidating and mer ging and laying people off. There have been hundreds of people laid off. The retail sales, we have had retail companies close. We have all seen that Cooper’s are closing out their ground- floor business, selling it off to Brown & Company. Well, they are not do ing it because they were making a ton of money. I mean, they are doing it because they want to get rid of it. And Brown & Company thinks that they can perhaps make a penny off of it. But all of the signs are out there. It is a very difficult retail environment. And what you are seeing in the larger industry, the insurance industry, is less employment. Com-panies are trying to be more efficient. And I would suspect, my own feeling about the company . . . and the Minister can speak to this, but the feedback I am getting from people is that business confidence is down, particularly in the international industry. Bus iness confidence is down. We know consumer conf idence is down because of shrinking retail sales. So, consumer confidence is out the window. So, wh at is the Government doing? We know that their big initiatives have so far failed to make any
Bermuda House of Assembly substantial increase in Bermuda’s economy to bring in foreign investment. And those are the circumstances behind this. We have seen, as my honourable co lleague, P at Gordon- Pamplin, said, increases in loads of taxes —land tax, foreign currency, purchase tax. Of course, foreign currency, purchase tax , affects ever ything because everything is brought in, anything in the retail sector. The sugar tax, et cetera, et cetera, et cetera. The cost of living is going up, and we have a shrinking base of Bermudians. We are still all waiting, of course, for the promised immigration reform. And, you know, unfortunately, this is all up against a backdrop of our competition. One of our main competitors, the Cayman Islands, seems to be in an economic boom. All the reports you get from Ca yman is of the size of their population, their property prices are going up, and their economy is booming. So, you know, we would assume that, in economic terms, they are doing something right, while we sit here. And we certainly appear to be in the doldrums. So, that is my difficulty with the Sinking Fund. That is your money for a rainy day. To me, the Mini ster is taking it because we are in a rainy da y. That is where we are. He is in difficulties financially, so he is saying, I have got to take this money and use it to pay down debt, because we don’t know what else to do. And that is why I want to see more of a plan from him. Where are we going forward? Are we just going forward on a wing and a prayer? Or is there a real financial plan to re -invigorate this economy? So far, I just have not seen that. And I wish that the Minister could share, not necessarily with me in the House, but with the me mbers of the public, where he sees this economy going. We have already seen, you know, warnings that came from the SAGE [Commission], it came from the N ational School of Government, that the size of the pu blic service was too large; there are too many public emplo yees. But what we have seen under this Go vernment is encouragement to hire more people while at the same time cutting services. So, you know, as I have said many times before, your trash is being collected once a week. We have had difficulty with the buses. But we see more people being hired. And from our point of view, you see the wrong message being sent. You know, when the Premier says, Oh, I’m encouraging my Ministers without personal staff that they should rush out and hire personal staff, somehow he thinks that does not result in a greater number of public employees. Those are the challenges, I think, that this F inance Minister is facing. And I would like for him to be a bit more specific about where he thinks we are going to be next year, whether he is going to be putting money into the Sinking Fund, or under what circumstances he would consider putting money in? Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. Does any other Honourable Member wish to speak? I recognise the Honourable Member from constituency 2. Honourable Member Swan.
Mr. Hubert (Kim) E. SwanYes, Mr. Speaker. As I listened, I am reminded of “the sky is fal ling” syndrome. And it is an important political narrative that would have persons buy into an Oppositi on narr ative aimed at trying to paint the Government in the worst possible light. I do not speak …
Yes, Mr. Speaker. As I listened, I am reminded of “the sky is fal ling” syndrome. And it is an important political narrative that would have persons buy into an Oppositi on narr ative aimed at trying to paint the Government in the worst possible light. I do not speak for the Minister of Finance, but I support the Minister of Finance, my colleague. And I know he is quite able and prudent in his methods. And I am sure that he understands all of that which is required to save for a rainy day. I find it interesting that the Opposition, who were once the Government, went into significant def icit spending using taxpayer money on the backdrop of cutting the same services that they are suggesting that this Government is prepared to bolster. We make no apologies about being concerned about the wor kers of Bermuda. And we are very mindful of the reality that caused the Government, in the mid- 2009, 2010, 2011, 2012 period, to have to go into deficit spending. It was called the recession, a global one at that, one which the Opposition, of which I participated very ably in, were quite successful in blaming the Government for a global recession. We did that. It was a narrative in 2009 that, as companies were leaving Bermuda, it was because of the PLP. We did that, and we did it well. And so, let Bermuda be mindful that the same narrative that would have portrayed that, would try to portray something like this Government does not concern its elf with fiscal prudence. I would just have to encourage persons to look at the Budget Book and to look at the column of actuals as it relates to what the bottom line of indebtedness was in 2017 and 2018 at $3 million. If you would look back, if I had the Budget Book for, say, 2014/15, the actuals, when the Oppos ition were the Government, inherited would have been probably around $1.92 million. Very little discussion took place about the billion dollars of indebtedness that took place under that administrat ion. Very little ink was given to that. And when you look at that narrative, that thesky-is-falling narrative, if $3 million in indebtedness — billion dollars in indebtedness —was the actual in 2017/18, what this Finance Minister has portrayed in an estimat e that goes down as far as 2021/22 is the same $3 million. So, in conservative estimates, stead-ying the ship from deficit spending is something that this Government has taken on board in a real way. But, look. I do not expect the Opposition to jump up and down and recognise those points of pr udence. I do not! It is not their job. Their job is to paint us in the worst possible light. And that is my job, to point that out, too, because that is what we see.
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Bermuda House of Assembly Hon. L. Craig Cannonier: Point of order, Mr. Speaker. Point of order, Mr. Speaker.
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading] Hon. L. Craig Cannonier: The Honourable Member is misleading the House. This Opposition is certainly not trying to point out the worst in PLP, as he noted. That is not our intent. We are looking for fiscal pr udence here, and that is …
The SpeakerThe SpeakerThank you. Hon. L. Craig Cannonier: Not some conspiracy narrative.
Mr. Hubert (Kim) E. SwanI am not pointing out a conspiracy narrative. If the Honourable Opposition Leader wants to talk about fiscal prudence, I am looking at the Budget Book. I am not making this up! I am looking at numbers! I am looking at numbers that point out— Hon. L. Craig Cannonier: Point …
The SpeakerThe SpeakerYes. We will take your point of order. POINT OF ORDER [Misleading] Hon. L. Craig Cannonier: The Honourable Member once again is misleading the House. The numbers do not point out that we are trying to cast the PLP Go vernment in a dark light. The numbers . . . …
Yes. We will take your point of order.
POINT OF ORDER [Misleading] Hon. L. Craig Cannonier: The Honourable Member once again is misleading the House. The numbers do not point out that we are trying to cast the PLP Go vernment in a dark light. The numbers . . . we are looking at the numbers. And we are not saying that the PLP is this dark entity that is trying to do all these bad things with these numbers. And that is what he is suggesting!
Mr. Hubert (Kim) E. SwanI am suggesting that the numbers suggest that the PLP is acting in a prudent manner, but in the same time is looking out for Mr. and Mrs. Working Bermuda, who were not taken in consideration by a previous administration, Mr. Speaker. And so, the Government — Hon. L. Craig …
I am suggesting that the numbers suggest that the PLP is acting in a prudent manner, but in the same time is looking out for Mr. and Mrs. Working Bermuda, who were not taken in consideration by a previous administration, Mr. Speaker. And so, the Government — Hon. L. Craig Cannonier: Point of order, Mr. Speaker. POINT OF ORDER [Misleading]
Hon. L. Craig Cannonier: The Honourable Member once again is misleading the House. Under the OBA Government, confidence was not down. Retail sales were not down. Those are the numbers. Under a PLP Government, we are under a confidence level that has never been seen before. In 12 months, a year now going—
The SpeakerThe SpeakerOkay. We got your point. Hon. L. Craig Cannonier: Thank you. The S peaker: We got your point.
Mr. Hubert (Kim) E. SwanMr. Speaker, when this Government comes forward with initiatives, such as FinTech, for instance, we have seen persons, like the Opposition Leader, get up and say how much he would support that. But then, in the next breath, his colleagues would go out and tweet or go on social media …
Mr. Speaker, when this Government comes forward with initiatives, such as FinTech, for instance, we have seen persons, like the Opposition Leader, get up and say how much he would support that. But then, in the next breath, his colleagues would go out and tweet or go on social media and say the exact opposite and purport the exact opposite. And we have seen some of the difficulties with regard to banking as it relates to bringing about the transformation which is required in this economy. So, no one is making any illusions about some of the challenges that are faced. But I do not expect anybody to jump up and down from the Opposition to make mention that a f inancing deal was, in fact, struck just this week for the [Caroline] Bay. You talk about transparency? It was that Government, the OBA, when they were in Government, they did not even tell the people of Bermuda that the people of Bermuda were on the hook for $165 million right on the heels of an elec tion. I do not hear any points -of-order. Point -oforder me on it if it is not true!
Hon. L. Craig Cannonier: It is not true.
Mr. Hubert (Kim) E. SwanBermuda was on the hook. And now, and now, this week, when the Oppos ition is on the floor of this Hous e talking about conf idence, they will remain silent by the fact that the pri ncipals of that major project now have secured some significant funding to be …
Bermuda was on the hook. And now, and now, this week, when the Oppos ition is on the floor of this Hous e talking about conf idence, they will remain silent by the fact that the pri ncipals of that major project now have secured some significant funding to be able to complete it. And let me tell you this. The Honourable Member, Mr. Zane De Silva, the Honourable [Minister] of Tourism, and the Honourable Member for Works and Engineering, and responsible for the golf courses, Mr. Tyrrell, are bringing significant . . . I always say you have got to fish where the fish are. I make no bones about it. In my trade in golf, there are many people who fit the profile of looking to be able to see the possibilities that exist in this country’s economy.
Bermuda House of Assembly Well, let me tell you where they are going to be in October for five more years. They are going to be up in Southampton and around Bermuda. They are going to be able to see [Caroline] Bay from the drones as they are being broadcast around the world, as the Government makes it possible —without building another island for them to do it, without going into signif icant debt to be able to do it. We are going to be fishing where the fish are in Southampton in the field of golf and looking at o pportunities to do just what the Opposition are sugges ting that we do not seem to want to . . . do not seem to know anything about in some r egard, in an inadvertent way. And I am here to tell you that you cannot in one breath talk about confidence without giving Jack his jacket. And Jack in this day is the amount of money that has been injected in this project to complete it, that would have a significant economic boon on the aims and objectives of a PLP Government, which, in fact, looks at life a lot differently than the way that the OBA does. There are some philosophical differences in the way in which we would look at doing things as a Gover nment. But let me say this. The Finance Minister is one whom I have a great deal of confidence in being able to set out why it is necessary for him to bring this amendment to the House to regularise what was pr esented during the budget. And I will defer t o his wi sdom in his summation. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. Does any other Honourable Member wish to speak? No other . . . Honourable Member Simons, constituency 8, you have the floor.
Mr. N. H. Cole SimonsThank you, Mr. Speaker. This has been very interesting, Mr. Speaker. I would not want to be in the Finance Minister’s seat at this time. As was said by my colleagues, Bermuda is going through some very interesting times from an economic point of view. And we all have to, …
Thank you, Mr. Speaker. This has been very interesting, Mr. Speaker. I would not want to be in the Finance Minister’s seat at this time. As was said by my colleagues, Bermuda is going through some very interesting times from an economic point of view. And we all have to, as one [Member] said earlier, measure twice and cut once. And when it comes to our finances, we have to be more prudent. Now, I heard the Minister indicate that he basically has suspended the contribution to the Sinking Fund. I understand his reasoning, as was said by my colleague Honourable Trevor Moniz. But I think, at the end of the day, he also needs to take from one part of his Ministry and give to another. So, in cutting back on the Sinking Fund contribution, I would have liked to have heard how he was going to implement an austerity programme to cut back on other expenses to r educe the debt. To me, that would have made eminent sense, and it would also have shown that, You know, okay. Well, I’m cutting back on the contribution to the Sink-ing Fund. And to offset that, I’m going to put in some programmes that will reduce the debt, reduce the size of government, reduce some of the programmes that we offer so that the debt can be better managed. And I am waiting to hear his comments in that l ight. I would like to also address the issue of cr editworthiness. How is this going to impact our credi tworthiness, from a regulatory . . . not a regulatory, but a credit rating point of view? Obviously, our gover nment debt is reviewed on a regular basis by Moody’s and other rating agencies. And what is their take on our not making a contribution to the Sinking Fund? Does the Minister have a plan in place that will say, Well, this is the plan for the next three years, given the current economic situation. We will basically waive our contribution. And in so doing, we have made up on the other end —i.e., the cost of government and the cost of debt. Mr. Speaker, we cannot continue to have our interest expenses at the levels where they are at now. Mr. Speaker, the interest expense is basically larger than most of the departments in government. And they are around $120 million a year, or even higher, Mr. Speaker. So, again, it is important that we reduce the interest expense. And the only way we can do that is to reduce the debt and refinancing of some of the debt. And it is important that we show discipline to our investors —i.e., our credit holders and the rating agencies. Because if they can do that, we can get debt at a cheaper price and a more cost -effective price, and hopefully reduce the cost of interest that is attached to our debt, and thereby making more programmes available to the people of this country. So, again, as was said by my colleague, to the Minister, what is the big picture? What is the plan? You cannot address the waiving of the Sinking Fund contribution in isolation. Everything has a cause and effect. And I would like to have heard more details on the cause and effect of the action that he is taking. I would like to also have information on, y ou know, what have the rating agencies suggested. I mean, they have regular contact with these people, how will that impact our creditworthiness? You know, at the end of the day, it is difficult. It is very, very difficult. And we all have to manage our books. And there are some compromises that occur. But at the end of the day, it is about, are we moving ahead from strength to strength from a financial point of view? And are we doing our best to stimulate the economy to grow the top line? And at this point in time, I see no evidence of any new industries that are substantially growing our GDP that will ensure that there is more money in circulation which will result in a greater contribution to the government’s coffers. So, again, what is the big picture? What is the plan going down the road in regard to the Sinking Fund? And how do the Minister and Government i ntend to manage it going forward within the next two or three years to ensure that our creditworthiness is not 1864 21 June 2019 Official Han sard Report
Bermuda House of Assembly compromised and that we can show and demonstrate that our debt is under control and that we are able to service it through interest burdens that will not contribute to being a heavy burden on the Government and people of Bermuda? Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable M ember. Does any other Honourable Member . . . ? We recognise the Honourable Member Pearman, from constituency 22. Honourable Member, you have the floor.
Mr. Scott PearmanThank you, Mr. Speaker. Mr. Speaker, I was not actually going to speak to this B ill. But sometimes, when people say things in this House, it sets off a chain of events. I think it is deeply regrettable that the Honourable Member from St. George’s, who spoke two speakers …
Thank you, Mr. Speaker. Mr. Speaker, I was not actually going to speak to this B ill. But sometimes, when people say things in this House, it sets off a chain of events. I think it is deeply regrettable that the Honourable Member from St. George’s, who spoke two speakers before me, felt the need to cast the comments being made about this legislation in the context that the Opposition is seeking always to paint the Government in a negative light. And he described us as trying to present an “ economic narrative. ” Now, “a narrative,” Mr. Speaker, as we know, is a story. And stories are usually fiction rather than fact. But the fact is we have seen 13 consecutive months of declining retail sales. And we are in a struggling economy. I echo the words of my honour able friend, Mr. Cole Simons, who said that he would not envy sitting in the chair that the current Minister of Finance sits in. I echo that. It is an unenviable job that he has. And it is incorrect for the Honourable Member for St. George’s to say that all we do is try and cast this in the worst possible light; we do not. The Oppositi on was supportive and commended the Government, and indeed the BTA [Bermuda Tourism Authority] and indeed Minister Zane De Silva on the last occasion about the PGA Tour. We commended them. We did not take objection to it. That is fact, not narrative, not f iction, not story.
The SpeakerThe SpeakerWe will take your point of order. POINT OF ORDER [Misleading]
Mr. Hubert (Kim) E. SwanThe Honourable Member, I believe, is inadvertently misleading the House. I happen to look on Facebook. I see his colleagues who contribute to aspersions that are made [about] this Government in any number of areas, and including what he just mentioned.
The SpeakerThe SpeakerThank you. Go ahead, Member. Mr. Scot t Pearman: Mr. Speaker, I am not misleading the House. I was here last week. The Leader of the Opposition and I both commended Minister Zane De Silva and the BTA for their efforts. And it was a job well done for the …
Thank you. Go ahead, Member. Mr. Scot t Pearman: Mr. Speaker, I am not misleading the House. I was here last week. The Leader of the Opposition and I both commended Minister Zane De Silva and the BTA for their efforts. And it was a job well done for the benefit of all of Bermuda. And we are proud to support them on that point. And the suggestion that we are trying to talk the economy down, that we are going around saying The sky is falling is unhelpful. We are pointing out fact, not fiction. We are dealing with numbers, not narrative. So, Mr. Speaker, I would respectfully say that when we are dealing with legislation such as this — which is important, which should not lead to unnecessary inflammatory and inaccurate debate from the Member from St. George’s —we should deal with the Bill that is in f ront of us. I do appreciate that the Minister of Finance has a very difficult job. And for my part, he is doing it well. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you. Does any other Member wish to speak? Minister. Hon. Curtis L. Dickinson: Mr. Speak er, I had hoped this morning, through kind of a well -written brief and presentation, not to have sparked any controversy with this proposed amendment. [Laughter] Hon. Curtis L. Dickinson: Having said that, having …
Thank you. Does any other Member wish to speak? Minister.
Hon. Curtis L. Dickinson: Mr. Speak er, I had hoped this morning, through kind of a well -written brief and presentation, not to have sparked any controversy with this proposed amendment.
[Laughter]
Hon. Curtis L. Dickinson: Having said that, having said that, you know, we are where we are. We do what we do. So, let me try to answer some of the questions that have been asked this morning as succinctly as I can. One of the things —and this is not about me. One of the things that I have noticed in my eight months as the Minister of Finance is that there is a wall in my Ministry that has pictures of all of my pr edecessors. And as I looked at the pictures on the wall, I realised that all of us have very differing bac kgrounds. There are a couple of . . . there is a phys ician, there is a chemist, t here is an engineer. There are a couple of guys who were asset managers. There is an entrepreneur, an IT professional, a lawyer. I am the first of my kind, as an expert in capital markets. And so, with that expertise, I bring, I think, a certain value to d iscussions around things related to our debt situation and how we address them. I think the approach that we have taken . . . and I have tried to be very careful. Because one thing that I noticed on day one in this job is that it is . . . it is an awesome job. It takes on lots of responsibility. And it is easy for those who are not in the seat to be crit ical. And so, out of respect for my predecessors, understanding the weight of the obligations that come with this job, I have stayed away from being critic al. Because in the moment, people make the best dec iBermuda House of Assembly sions they can, based on the information that they have. With respect to the Sinking Fund, it is a concept that is rooted in history. You float debt. And as a way of ensur ing that you can pay it back you provide money into a fund in order to sink it. And so, when you float in the issuance, you sink on the redemption. The Sinking Fund today has about $118 mi llion in it, after having repaid an issuance of $100 mi llion of private placement notes. One of the things that people, I think, need to fully understand about Berm uda is, when we first issued private placement notes, the audience for those notes, the investors in those notes were primarily insurance companies. Those notes tended to cost more than publi c market debt. Today, most of our debt is issued in the public markets. We are a AA - rated country, a very highly rated sovereign, by the way. I could take the Sinking Fund proceeds today and go and use those monies to buy back debt that is currently outs tanding. But I have chosen not to, because I believe that the concept of the Sinking Fund is one that has value, and we are going to save that money to use it to redeem notes at the end of the year. So, rather than increasing debt to pay back debt, we are going to wait and be prudent. Similarly, we are not going to incur debt at an interest cost greater than what we can achieve on it in savings. It does not make any sense under the current circumstances. As a finance expert, I can present a set of circumst ances where it makes sense to borrow money at a higher rate than you can get it in savings. But we are not in those circumstances today. And so, my advice and my policy position are that we not do that anymore. There has been some talk about the numbers. And so, let me give you a preview of the numbers. We had estimated in the budget presentation that the Government would take in approximately $1,079,000,000 in revenue, and spend for fiscal 2018/19, $931.9 million, leading to a deficit of approximately $102.6 million. We were roundly criticised during the Budget Debate for having numbers that were shy of the original estimates. I can report today preliminary numbers. Our revenue numbers were actually $6 million above the estimate that was presented in Febr uary. And our expenditure numbers were $15 million less than what we projected. So, the budget deficit for 2018/19 came in substantially lower than was originally projected and what was presented in the revised presentation. So, the notion that people are not focusing on the num-bers and [not] trying to manage the public purse appropriately are not true. With respect to the plan, I think I outlined the plan in my brief. But, simply put, I have not chosen to raise the debt ceiling as a way of instilling some sort of discipline in terms of how this Government con-ducts itself. Any monies that are received in surpluses should be used to either contribute to the Sinking Fund or make public market purchases of existing securities. So, basically, I am buying back t he debt — not spending the money, not frivolously wasting the money. The rating agencies have been very clued- in on what it is we have been doing over the course of the last 15 –16 years with the Sinking Fund, especially as we have been borrowing to fund it . It is equivalent of taking your credit card and spending $1,000 on it, and then going and putting $1,000 in the bank and saying, Well, I’ve got $1,000 saved. But net/net, you have zero. It is as simple as that. Most people do that because they have to do it; we do not have to do it that way. It costs us more money to borrow to save. And as we start thinking about being prudent, being fiscally prudent and making smarter decisions, this was one that I could not support in light of where we find ourselves. As a general matter, I speak with authority for the Government with respect to matters of finance. And I am very careful in the words that I use because I understand the power of my saying something. So, I have said this before, and I will say it again. We are projecting a surplus for 2019/20. We are two months in. In the remaining 10 months, we will see how well we do versus those projections. We are projecting a surplus in 2020/21 and 2022. And we will see how the economy moves over the course of time to deliver on those results. There is no surplus today. There is a projection of one. And I think it is important that I say it, pr ovide the right context in terms of what the Gover nment’s position is with respect to our budget. We have projected a surplus. Rating agencies are fine with this. And in my brief, I think I mentioned that the Sinking Fund conti nues to provide overall credit support to Bermuda, as it helps the Government to meet its debt obligations. Nonetheless, should the Government continue to post fiscal deficits, pushing debt stocks higher —meaning borrowing more money to fund the Sinking Fund — contributions to the fund will rise and continue to be mainly financed through additional debt, thus decreasing the Sinking Fund’s effectiveness as a sav ings mechanism. So, we are going to use the surpluses to buy back debt —in effect, reducing debt. We are working not to increase the debt ceiling, so we cannot borrow anymore unless we need to. And I will not make an absolute statement that I will not rais e the Sinking Fund . . . I will not raise the debt ceiling, because I do not want to be in the business of making irresponsible statements as a Finance Minister. If the country has a disaster that requires the Government to intervene, provide assistance in rebuilding, we may have to borrow those monies, and I will not lock myself in by sa ying we are not going to raise the debt ceiling. Because I am sure that all of us in this House would agree that 1866 21 June 2019 Official Han sard Report
Bermuda House of Assembly we have an obligation, as a Government, to support our resi dents, especially in times of disaster. So, with that, Mr. Speaker, I move that the Bill be committed.
The SpeakerThe SpeakerThank you, Minister. Will we have the Honourable Member from constituency 2 take the Chair? House in Committee at 12:18 pm [Mr. Hubert (Kim) E. Swan, Chairman] COMMITTEE ON BILL GOVERNMENT LOANS AMENDMENT ACT 2019
The ChairmanChairmanGood afternoon, Members. We are in the Committee of the whole [House] to consider the Government Loans Amendment Act 2019 , under the Minister of Finance. Minister of Finance, you have the floor. Hon. Curtis L. Dickinson: Thank you, Mr. Chairman. I move clauses 1 through 6.
The ChairmanChairmanIt has been proposed that all clauses be moved. Any objections? No objection. Continue on, Minister. Hon. Curtis L. Dickinson: Mr. Chairman, clause 1 is self-explanatory. (Sorry.) The Bill seeks to amend the Government Loans Act 1978 to provide for special arrangements in respect of the Sinking Fund. Clause 1 …
It has been proposed that all clauses be moved. Any objections? No objection. Continue on, Minister.
Hon. Curtis L. Dickinson: Mr. Chairman, clause 1 is self-explanatory. (Sorry.) The Bill seeks to amend the Government Loans Act 1978 to provide for special arrangements in respect of the Sinking Fund. Clause 1 is self -explanatory. Clause 2 amends subsection (2) of section 12 by repealing the subsection and substituting subsections (2) and (2A). Under the new subsection (2), the Minister may, in each financial year, pay into the fund out of the Consolidated Fund an amount equal to 2.5 per centum of the public debt outstanding or such other amount as he may deem appropriate upon taking into consideration the annual budget. Under the new subsection (2A), in each financial year there s hall be paid into the fund out of the Consolidated Fund any amount from the sums borrowed under section 2(1) that is in excess of the annual budgetary requirements and the whole or part of any amount realised from the sale of land by the Minister responsible for Works and Engineering, as approved by the Legislature. Clause 3 amends subsection (4) of section 12 by repealing the subsection and substituting subsections (4) and (4A) so as to require that contributions payable under the new subsections (2) and (2A) of section 12 shall be paid within the applicable financial year and to provide that interest shall not accrue in the case of non- payment of the contributions within the applicable financial year. Clause 4 amends section 12A(1)(a) to provide that the Sinking Fund can be applied to purchase the public debt. Clause 5 amends the principal Act to repeal section 12AA, as power of the Minister to suspend contributions without incurring interest is now provided for under section 12 as amended by clauses 2 and 3 of the Bill. Clause 6 provides for amendments to the principal Act to be deemed to apply to the financial year 2019/20.
The ChairmanChairmanThank you, Minister. The Chair recognises the Honourable Member from constituency 23. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, I just have a question in r espect of clause 3 on page 2. And this is [new] subsection (4A). And the existing legislation speaks to, if …
Thank you, Minister. The Chair recognises the Honourable Member from constituency 23.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, I just have a question in r espect of clause 3 on page 2. And this is [new] subsection (4A). And the existing legislation speaks to, if the Sinking Fund contribution is not made, then there is an interest amount that needs to be paid into the fund, into the Consolidated Fund, in respect of that late payment, if I can put it that way. My question is, and I believe the Minister may agree with this, Why would we not just suspend the idea of interest payments? And I say that from the perspective that, while I recognise and I advocate that money should be paid into the Sinking Fund, and I understand that the inter-est in the absence of those payments is effectively a penalty for non- payment, does it really make sense for Government to be taking money out of the Consol idated Fund to be paying into the Consolidated Fund interest for money that they have not put into the Sinking Fund? Somehow, it just does not seem to make an awful lot of sense. Can we not consider suspending the idea of interest on non- payment of Sinking Fund contrib utions, because it is really government paying gover nment? And does it really make any sense? I think the challenge that we have is either we are going to contribute to the Sinking Fund or n ot. This gives the Minister the flexibility to say that if the budget dictates that there are no additional funds, that there could be contribution to the Sinking Fund, that he has that discretion so to do. But somehow, the i nterest element of it just does not seem to make an awful lot of sense. And I am just wondering whether the Government would consider whether, in fact, the . . . I mean, it says, “No interest shall be incurred where a contribution referred to in subsection (4) is not paid” in the year t hat “it was determined as pay able under subsection (2) or required to be paid under subsection (2A).” But if you stop to think about it, the whole idea of government paying itself interest seems to be a
Bermuda House of Assembly nonsensical argument. I understand that when it was initiated before it was effectively to focus on the fact that if you cannot cut your suit according to your cloth therefore you would be penalised as a result. But gi ven how this has become very fluid in terms of how we will be approaching contributions to the Sinking Fund, and while I heard the Minister indicate that it is his intention to be operating a . . . he is projecting a surplus for 2019/20, 2020/21 and 2021/22 in which there will perhaps be funds to be able to pay into the Sinking Fund during that period of time or purchase back debt so that we reduce our net debt situation, the idea of this interest still seems to boggle me a little bit. What is the efficacy of it? What sense does it make to be paying interest to ourselves as a Government? I am just curious.
The ChairmanChairmanThank you, Member. Does any other Member care to speak to clauses 1 through 6? Honourable Member from constituency 24 [sic].
The ChairmanChairmanTwenty -two. Sorry. I went one up. You got to go back one down.
Mr. Scott PearmanThank you, Mr. Chairman. And now that you are sitting in the Chair as opposed to [sitting] behind me on my previous remarks, I hope those are now forgotten. [Laughter]
Mr. Scott PearmanI just do not know if the Honourable Mi nister wants to [answer] the question posed, and then I will pose a separate question. I am entirely in your hands, Mr. Chairman, as to how to proceed.
Mr. Scott PearmanYes. I just had a question, one question about clause 4. And I think the Minister has clarified it. But for the benefit . . . this can be quite complicated stuff, and we use lots of complicated phraseology and terms. But I understand the Minister to be saying, and …
Yes. I just had a question, one question about clause 4. And I think the Minister has clarified it. But for the benefit . . . this can be quite complicated stuff, and we use lots of complicated phraseology and terms. But I understand the Minister to be saying, and I understand clause 4 to be effecting, that what is taken from the Sinking Fund will be solely used to repur-chase debt. And I just would invite the Minister to clarify that for those listening. Thank you, Mr. Chai rman.
The ChairmanChairmanThank you. Does any Honourable Member care to speak to claus es 1 through 6? Minister. Hon. Curtis L. Dickinson: Thanks, Mr. Chairman. With respect to the Honourable Member from constituency 23, my MP — [Inaudible interjections ] Hon. Curtis L. Dickinson: You will never know. The [new subsection] (4A) …
Thank you. Does any Honourable Member care to speak to claus es 1 through 6? Minister. Hon. Curtis L. Dickinson: Thanks, Mr. Chairman. With respect to the Honourable Member from constituency 23, my MP —
[Inaudible interjections ]
Hon. Curtis L. Dickinson: You will never know. The [new subsection] (4A) that you refer to . . . actually, the point you make is a valid one. And the existing legislation calls for it. There is a suspension in the payment, that interest, actually . . . government pays itself interest. And so, the point of the new subsection (4A) is to r emove that feature completely. It did not make any sense then, and it does not make any sense now. So, we are fixing it by sa ying that there will no longer need to be a penalty of interest on any funds that are not paid into the Sinking Fund. And in actua l fact, because we are removing the mandatory nature of the contributions, that should never be a problem anymore. With respect to the question from the Honourable Member from constituency 22, the Sinking Fund is . . . what we are trying to do here is . . . the disc ipline is that the funds will be used to either repay outstanding debt that is maturing, as we did in May and will do again in November, or we will use the proceeds to go out into the open market to buy back debt. There is a feature in the legi slation that allows for the Sinking Fund proceeds to be used to pay interest on existing government debt. I do not contemplate, at least in the budgets that I have presented for this fiscal year and next year, that this will be the case. The funds are prim arily used to repay existing debt or can be used to repurchase . . . repay existing debt that is maturing or repurchase existing debt that is outstanding to retire it.
The ChairmanChairmanThank you. Does any other Member care to speak to clauses 1 through 6? There seem to be no other persons wishing to speak. Minister, would you like to move the clauses? Hon. Curtis L. Dickinson: Mr. Chairman, I move that all six clauses stand as approved.
The ChairmanChairmanOkay. It has been moved that all clauses be approved. Any objection? No objection. [Motion carried: Clauses 1 through 6 passed.] Hon. Curtis L. Dickinson: Mr. Chairman, I move that the preamble be approved.
The ChairmanChairmanIt has been moved that the preamble be approved. 1868 21 June 2019 Official Han sard Report Bermuda House of Assembly Hon. Curtis L. Dickinson: I move that the Bill be r eported to the House as printed or amended.
The ChairmanChairmanIt has been moved the preamble, and it has been moved that the Bill be reported to the House as printed. Are there any objections? No objections. The Bill stands approved. And we will report the Bill to the House. [Motion carried: The Government Loans Amendment Act 2019 was considered …
It has been moved the preamble, and it has been moved that the Bill be reported to the House as printed. Are there any objections? No objections. The Bill stands approved. And we will report the Bill to the House.
[Motion carried: The Government Loans Amendment Act 2019 was considered by a Committee of the whole House and passed without amendment.]
House resumed at 12:28 pm [Hon. Dennis P. Lister, Jr., Speaker, in the Chair]
REPORT OF COMMITTEE
GOVERNMENT LOANS AMENDMENT ACT 2019
The SpeakerThe SpeakerMembers, are there any objections to the second reading of the Government Loans Amendment Act 2019 being reported to the House as printed? No objections. It will be reported as printed. It is now 12:28. At 12:20 [sic] , there is a normal break that takes place at this time. …
Members, are there any objections to the second reading of the Government Loans Amendment Act 2019 being reported to the House as printed? No objections. It will be reported as printed. It is now 12:28. At 12:20 [sic] , there is a normal break that takes place at this time. And rather than proceed to the next item, I am going to ask the Deputy —
An Hon. Member An Hon. MemberYes. You said “at 12:20.”
The SpeakerThe SpeakerOh, oh, oh. I am sorry, 12:30. I am sorry. Yes. Thanks for the correction. But it is 12:28; we are two minutes from 12:30. Rather than start the next item, Deputy, would you like to — Hon. Walter H. Roban: Yes, Mr. Speaker. I move that we adjourn for …
The SpeakerThe SpeakerThank you. Any objections to that? No objections. The House now stands adjourned for lunch until 2:00 pm. [Gavel] Proceedings suspended at 12:29 pm Proceedings resumed at 2:04 pm [Hon. Dennis P. Lister, Jr., Speaker, in the Chair] ORDERS OF THE DAY [Continuing]
The SpeakerThe SpeakerGood afternoon, Members. [Gavel]
The SpeakerThe SpeakerMembers we had gotten to the point before lunch where we had concluded the first item that was up for debate this morning and that was the Government Loans Amendment Act 2019 and we were about to proceed to the second item on today’s Order Paper. And for the sake …
Members we had gotten to the point before lunch where we had concluded the first item that was up for debate this morning and that was the Government Loans Amendment Act 2019 and we were about to proceed to the second item on today’s Order Paper. And for the sake of clarity, this item is actually one that is going to have its first, second and third reading today, which has been agreed to by both sides. And I just want to mention it , in that it is not something that we would normally do, and it is not something that I want to see become standard or [a] custom. B ecause of the significance of it, it has been agreed and we are goi ng to allow it to proceed [in this] way, but by no means, Ministers, do I want this to become a standard practice. With that said . . . Minister.
SUSPENSION OF STANDING ORDER 29(1)
Hon. Curtis L. Dickinson: Thank you, Mr. Speaker . Mr. Speaker , I move th at Standing Order 29(1) be suspended to enable the House to proceed with the second reading of the Bill entitled Economic Substance Amendment Act 2019.
The SpeakerThe SpeakerAny objections? Hon. Trevor G. Moniz: Mr. Speaker , I would like to speak to this, if I ma y, because I think it is incumbent upon the Minister to give an explanation, not just to the House, but to the public of Bermuda, why we are doing this. This …
Any objections? Hon. Trevor G. Moniz: Mr. Speaker , I would like to speak to this, if I ma y, because I think it is incumbent upon the Minister to give an explanation, not just to the House, but to the public of Bermuda, why we are doing this. This is unprecedented, except for the last occasion upon which we dealt with the Economic Substance Bill . So I understand that, in principle, the Oppos ition has —
The SpeakerThe SpeakerIs you microphone on? Hon. Trevor G. Moniz: Yes, my microphone is on. The Opposition have agreed to do this, but I think that it should go on record from the Minister why we are in a position of doing something so important and needing to suspend [Standing] Order 28 …
Is you microphone on?
Hon. Trevor G. Moniz: Yes, my microphone is on. The Opposition have agreed to do this, but I think that it should go on record from the Minister why we are in a position of doing something so important and needing to suspend [Standing] Order 28 [sic] to do it all in one day.
Bermuda House of Assembly I notice that the House did not sit last Friday; I cannot believe that some version of this Bill was not available last Friday. All week I was looking for some announcement from the Government that this was going to take place today and there was nothing from the Government. It makes it look as if there was some cloak and dagger involved. I would have thought the Government would have wanted to announce that they were going to deal with this matter today in a public forum, not here . . . not in a private forum, not in secret meetings, but in a public forum. People seem to forget we are doing the people’s business. And while I understand certain i nformation may be sensitive information, it cannot be sensitive to the degree that you cannot tell the people of Bermuda, Look, we’re coming back here to look at the Economic Substance Bill to make a substantive change. And they could have done that at any time. If that is not the case, the Minister needs to explain why that is not the case, why he would not have been able to table a copy of the Bill or make a statement to the House last Friday or the week before. I notice we took a break last Friday as if we had not hing to do, and then this Friday we are in a huge rush saying we have got to rush, rush, rush, rush this through. And so I would have thought . . . I do not like to see this as a practice. And I know, Mr. Speaker , that you do not like to see it as a practice as well. And I think it is incumbent on the Government to explain themselves to the people in Bermuda . . . just with respect to suspending [Standing Order] 28 [sic] with respect to this Bill. Thank you, Mr. Speaker , for your leniency.
The SpeakerThe SpeakerThank you. Minister? Hon. Curtis L. Dickinson: Mr. Speaker , let me first start by saying I thank the House for its indulgence in suspending [Standing Order] 29(1). But to the Member’s point, the Ministry of F inance hosted a briefing session on Tuesday or Wednesday of this week for …
An Hon. Member An Hon. MemberOn Monday. Hon. Curtis L. Dickinson: On Monday , to brief them on—
The SpeakerThe SpeakerTuesday, because Monday was a hol iday. Hon. Curtis L. Dickinson: On Tuesday or Wednesday of this week —I was off Island attending to other matters —to brief the Opposition, who, I understand, like me, are representatives of the people of Bermuda. And so in no way was the Government …
Tuesday, because Monday was a hol iday.
Hon. Curtis L. Dickinson: On Tuesday or Wednesday of this week —I was off Island attending to other matters —to brief the Opposition, who, I understand, like me, are representatives of the people of Bermuda. And so in no way was the Government trying to not consult Bermuda about what was going on with r espect t o this amendment. Earlier today there was discussion about pr ocess, and I think the Honourable Member may have been referring to process. And I accept his point around good process because good process is orderly, predictable, and it is good for our Gover nment. However, in instances of national interest sometimes we have to suspend process in order to be expedient, in order to be pragmatic, in order to get the people’s business done in a timely fashion to minimise harm. And in this instance we sought to d o as much. I am certainly willing to offer a broader explanation around the whys , if folks feel that that is required. But this is a matter of national urgency, that if we do not do something the potential ramifications for the Bermudian people and Bermudian economy are signif icant.
The SpeakerThe SpeakerThank you . Did you wish to give a broader . . . or are you fine? Hon. Curtis L. Dickinson: I am sorry, sir?
The SpeakerThe SpeakerDid you wish to do a broader , or are you okay? Hon. Curtis L. Dickinson: I am fine, unless —
The SpeakerThe SpeakerOkay. So are you going to do your i ntroduction now? Hon. Curtis L. Dickinson: I am going to do the intr oduction now, Mr. Speaker . [Inaudible interjections]
The SpeakerThe SpeakerAnd I should have asked . . . sorry. Is there objection to the suspens ion of Standing Order 29[(1)]?
An Hon. Member An Hon. MemberNo objection.
The SpeakerThe SpeakerNo objections. [Motion carried: Standing Order 29(1) suspended to enable the second and third readings of the Ec onomic Substance Amendment Act 2019 to be taken during this sitting .]
The SpeakerThe SpeakerContinue, Minister. BILL SECOND READING ECONOMIC SUBSTANCE AMENDMENT ACT 2019 1870 21 June 2019 Official Han sard Report Bermuda House of Assembly Hon. Curtis L. Dickinson: Mr. Speaker , I move that the Bill entitled the Economic Substance Amendment Act 2019 now be read the second time.
The SpeakerThe SpeakerAny objections? None. Continue. Hon. Curtis L. Dickinson: Mr. Speaker , the Bill now before the House is the Economic Substance Amendment Act 2019. This Bill will exempt entities that are tax resident in a qualifying jurisdiction from the substance requirem ent of the Economic Substance Act 2018. Mr. Speaker …
Any objections? None. Continue. Hon. Curtis L. Dickinson: Mr. Speaker , the Bill now before the House is the Economic Substance Amendment Act 2019. This Bill will exempt entities that are tax resident in a qualifying jurisdiction from the substance requirem ent of the Economic Substance Act 2018. Mr. Speaker , on the 17 th of May Bermuda was removed from the EU’s list of non- cooperative jurisdi ctions for tax purposes because the EU was satisfied that our economic substance framework met its standards. Mr. Spe aker, the Ministry of Finance is in the process of analysing the various approaches to ec onomic substance adopted by other criterion 2.2 juri sdictions. Criterion 2.2 is a standard of assessment used to determine whether harmful tax measures are prevalent i n a jurisdiction based on its legal framework and the economic evidence. There are several areas of divergence between Bermuda and the Crown Dependencies and overseas territories which will be dealt with in due course. One area that poses an immediate and significant threat to Bermuda’s economy and requires urgent attention relates to tax residency. Mr. Speaker , it is imperative for Bermuda to align its economic substance legislative framework as it relates to tax res idency with that of other 2.2 jurisdicti ons and to do so before existing entities become subject to economic substance requirements on July 1, 2019. Mr. Speaker , under a tax residency exem ption, entities that are tax resident in a qualifying juri sdiction would not be required to be subject to substance requirements in their jurisdiction of incorpor ation. Mr. Speaker , Bermuda does not exempt entities that are resident in another jurisdiction for tax purposes from economic substance requirements. The absence of such an exemption in the Bermuda legi slation puts Bermuda at a serious commercial disa dvantage relative to all of our competitors. Mr. Speaker , there is a serious risk that up to 20 per cent of Bermuda’s registered entities may be forced to relocate from Bermuda to one of the other 2.2 juris dictions, simply because those other jurisdi ctions have the certainty of a tax residency exemption. If all such Bermuda entities do relocate, that will result in a direct and irreversible loss to Bermuda of substantial government fees and a very serious loss of economic expenditure in the jurisdiction and the loss of, potentially, hundreds of Bermudian jobs. Therefore, Mr. Speaker , the most immediate and significant amendment that is required at this stage is the addition of an exclusion for entities that are resident for tax purposes in a jurisdiction outside Bermuda. Mr. Speaker , an exemption from economic substance requirements for entities that are resident for tax purposes in another jurisdiction are based on the following OECD principles: a) A tax residency exemption must not be used to circumvent substance requirements; ther efore, safeguards must be put in place. b) Evidence must be provided to support a claim that an entity is resident in another jurisdi ction. c) Once an entity claims to be resident in anot her jurisdiction for tax purposes, such a claim and supporting evidence must be exchanged with the jurisdiction where the entity claims to be tax resident and the jurisdiction of res idence of the immediate parent, ultimate parent, and ultimate beneficial owner to ensure full transparency with regard to the tax res idency claim. Mr. Speaker , existing companies are required to comply with requirements of the Economic Substance Act by the 1 st of July. As I have indicated, due to the potentially significant impact on the Bermuda economy, it is critical that this amendment come into force before July 1st. Mr. Speaker , when I met with Mrs. Lyudmila Petkova, Chair of the code of conduct group for bus iness taxation in April, I expressed my concerns about a potential lac k of a level playing field between criter ion 2.2 jurisdictions, and she invited Bermuda to put our concerns in writing. Mr. Speaker , I spoke with Mrs. Petkova and her technical team on the telephone about 10 days ago and sought her support for advancing t his amendment before the 1 st of July. I can say that the discussion was very productive. Following that call I wrote to her formally and presented her with a draft Bill for her consideration. I also wrote to Mr. Pierre Moscovici, the Chair of the EU Commis sion, seeking his support. Two days ago I spoke with Mr. Moscovici by telephone and the conversation was very positive. I have also informed Mr. Robert Jenrick, the UK’s Sec-retary of the Exchequer, of Bermuda’s intent to amend our legislation to create a t ax residency exemption before the 1 st of July. Mr. Speaker , over the last three days the FHTP [ Forum on Harmful Tax Practices ] has reviewed the legislative framework of the 2.2 jurisdictions. A ccordingly, as part of Bermuda’s legislative framework, a draft Bill, together with a full explanation of the reasons for this urgent amendment, were formally su bmitted to the FHTP for review. The House is advised that the results of the review will be released to the public upon notice from the OECD.
Bermuda House of Assembly Mr. Speaker , the House is advised that the amendments are in line with the FHTP standards as follows: a) Entities that are resident for tax purposes in a jurisdiction outside of Bermuda, that are not listed on Annex 1 to the EU list of noncooperative jurisdictions for tax purposes, i.e. the blacklist jurisdictions, will be able to avail themselves of the revised framework. b) Such an entity must provide to the Registrar evidence of tax residency in another jurisdi ction for each relevant financial period. c) The information received by the Registrar will be provided to the foreign competent authority of a relevant jurisdiction in which a holding entity, the ultimate parent entity, and the owner or the beneficial owner of the entity is incorp orated, formed and registered or resident. Mr. Speaker , the Act is also amended to wi den the scope of exchange of information to all relevant jurisdictions, not just EU member states, in relation to high-risk IP entities, entities that are in breach of ec onomic substance requirements, as well as entities that claim to be resident for tax purposes in another juri sdiction. Mr. Speaker and Honourable Member s, the Bill is in line with the FHTP stated principles, and with those comments I invite other Honourable Member s to participate. Thank you, Mr. S peaker .
The SpeakerThe SpeakerThank you, Minister. I recognise the Deputy Opposition Leader. Honourable Member , you have the floor.
Ms. Leah K. ScottThank you , Mr. Speaker . Mr. Speaker , I have a lot of information here, and although I know there is backwards and forwards, I want to be able to present it so that people can act ually understand what is going on. I have to say thank you …
Thank you , Mr. Speaker . Mr. Speaker , I have a lot of information here, and although I know there is backwards and forwards, I want to be able to present it so that people can act ually understand what is going on. I have to say thank you to the Minister and to the Premier. The Premier actually called me on Su nday, while I was at a wedding, to ask me if we would be amenable to having this legislation presented to the House on Friday, and I told him that we would. And I had an email exchange with him on Tuesday and we had a meeting at 4:15 pm, to which all of our parliamentary colleagues were invited to attend. And at that meeting it was explained to us the reason that we had to do this. And I guess, for me, Mr. Speaker , I look at it from a different perspective other than politically. I look at it from an industry perspective. And I recognise that this is something that we need to have done in order for Bermuda to be a competitive jurisdiction. The OECD and the EU continue to bombard us with regulations and legislation and things that they require us to do as a jurisdiction. And so, as I think I have said before in this House, they started with the TIEAs, they have ended up here with economic substance, and who knows where we are going to go beyond that. So Mr. Speaker , the basis of “economic substance” is to eliminate what they call “base erosion profit shifting” or BEPS. And I am going to see if I can break it down so that Mr. and Mrs. Smith can understand it. So, what happens is, if you have a company like Google and Google makes a million dollars, they will pay tax on that million dollars and then what profits th ey have left over they will send to Bermuda or Cayman or another jurisdiction so that they pay a lo wer tax rate. So it is not tax evasion, it is tax planning, as far as I am concerned. And so the EU and the US and other places believe that they are losing out on revenue because these people are setting up companies in Bermuda and they are shifting their profits to Bermuda. I understand that economic substance is deemed to assist the US and the UK and other juri sdictions from eroding their own tax base, but my u nderstanding is that most countries which have a tax system actually devise a tax system that they believe will support their infrastructure. And I do not know if anybody has seen a US or a UK tax return, but the tax return has different formulas and if, you know, you calculate this to “Y” and then you add this to “X” and then at the end of the day you figure out what it is that has to be paid for your tax. The calculation is devised by those jurisdictions. So if an entity has money left over after the y have paid the relevant amount of tax that they are supposed to pay, why is it that country’s business to determine what they do with the profits that are left over? When I get paid, after I have paid all of my bills and done what I needed to do, should m y boss tell me, Well, Ms. Scott, I think you need to put that $500 here or there? What right does he have to do that?
[Inaudible interjection]
Ms. Leah K. ScottNo, but if I did have $500 left over. Well, you know, we have got what is supposed to be known as the rule of law and sovereignty, where somebody cannot come into your country and tell you what to do in your country. And I do not u nderstand …
No, but if I did have $500 left over. Well, you know, we have got what is supposed to be known as the rule of law and sovereignty, where somebody cannot come into your country and tell you what to do in your country. And I do not u nderstand how Bermuda, Cayman, BVI, Turks and Caicos, Jersey . . . have allowed the EU to do this. If they want to c ollect their tax dollars, then let them set up their own legislation. Why do we have to set up legi slation to do their dirty work for them? Why do we have to be a repository of information to benefit them? We do not have a tax law in Bermuda. If they have imposed a tax law and they have mismanaged their funds or they have overest imated what is required for their infrastructure, then why should wealthy businesses support governments in that way? I do not agree with it. 1872 21 June 2019 Official Han sard Report
Bermuda House of Assembly Now the interesting thing about base erosion profit shifting is that it is generally done by intellectual property companies —so Google, Microsoft, and A pple. And we knew that Google was here in Bermuda and we knew that Google was (in quotes) “a big of-fender.” And so this should really be the Google legi slation, not economic substance. But we are where we are. So, knowing that this was intended to target Google, what is really disappointing is that there were amendments made to our legislation—two clauses — that discussed intellectual property. A nd the minor technical omission which caused us to be on the blacklist was in respect of intellectual property. If any clauses were to be amended in that legislation, that was the last one that should have been amended. We should have not found ourselves on the blacklist. I went to meetings for two and a half years where we met with the Minister, we met with people from Luxembourg, we met with the BMA, we met with industry, to avoid ending up in the position where we are. And I am going to tell you, Mr. Speaker , that if the person who is responsible for us being on the blacklist was in private industry, they would have been walked out the door.
Some Hon. Members Some Hon. MembersMm-hmm. [Inaudible interjections ]
Ms. Leah K. ScottAnd I am sorry, I realise that wh oever it was has a job and a family, but we are now on the back foot because of a human mistake! And that is unacceptable to me, and it should be unacceptable to the Premier, to the Minister of Finance, and …
And I am sorry, I realise that wh oever it was has a job and a family, but we are now on the back foot because of a human mistake! And that is unacceptable to me, and it should be unacceptable to the Premier, to the Minister of Finance, and to all of Bermuda because we are now jeopardised! [There are other] jurisdictions that have legislation that is effective. We have legislation that is onerous and is nowhere near what is in the other jurisdictions’ legisl ation. Mr. Speaker , we have people that are leaving Bermuda . . . and the Minister is correct. We had to have this in by the 1 st of July. And people are asking, Well, why are we waiting until the eleventh hour to do this? My understanding is that we were working to get ourselves off the blacklist first. It is unfortunate that while we were working to get ourselves off the blac klist that the OECD decided to do a technical asses sment of our economic substance regime. They have a team in here that is looking at foreign harmful tax practices. And so every piece of legislation or amendment that we make in terms of economic substance now has to be approved by the OECD. We cannot just go and make our own legislation. And so because the Government was not sure where the OECD was going to land in terms of tax residency —remember that they are imposing this legislation on the BOTs [British Overseas Territories] as well as the Crown Dependencies, and each of those entities . . . or jurisdictions, I am sorry, have di fferent regimes. Some have tax; some do not. And so we did not know wher e they were going to land in terms of whether they were going to accept our definition or our carveout for tax residency. So we had to wait for them to approve it. And, you know, no, I am not happy about having to do a first, second and a third reading tod ay, but for the sake of expediency we have to have it done. We are playing catch- up to try to get ahead. So I understand that people are upset about it, I hope that the general public understands that this is the reason that we had to do it. I do not belie ve that . . . you know, I think that it was a situation where the Government was between a rock and a hard place. Yes, I am the Opposition and maybe I should not acknowledge that, but it is what it is. And I am looking at it from an industry perspective and we have to do what we have to do to make sure that our industry and our jurisdiction is a place where people want to come and invest their money. So, Mr. Speaker , we had to get off the blac klist. And I do not think that anybody recognises the severity of how we have been hampered by being on the blacklist, even though it was only for two months. So we have lost our competitive disadvantage [sic], we still do not have the amount of certainty — [Inaudible interjection]
Ms. Leah K. ScottSorry, “advantage” (yes, thank you). We do not have certainty because we still have other changes that we need to make to our legislation. I have a colleague who has a trust company and she was in the UK two months ago. And, if you will allow me, she sent …
Ms. Leah K. Scott—and she was so upset. She said: “Dear Leah, I am in London today for what I thought and expected to be a meeting with one of our large families and their advisors for general update and planning. It was somewhat of a surprise to r eceive our walking papers …
—and she was so upset. She said: “Dear Leah, I am in London today for what I thought and expected to be a meeting with one of our large families and their advisors for general update and planning. It was somewhat of a surprise to r eceive our walking papers from a family that we have looked after for over 14 years. The reason was all about economic substance and consolidating their structure to Monaco. This represents 10 entities —both Bermuda companies and trusts —an approximate fee revenue of over $250,000. I had hoped that due to the number of Bermuda entities in the structure that it would have remained, but due to uncertainty inad equate” (sorry “uncertainty in the word ‘adequate’”) “in what is adequate substance, has led them to move the entire structure. I know you are getting it from all angles, but at the end of the day we hope that some
Bermuda House of Assembly good will come of this, but I have a sinking feeling that Bermuda may suffer more than expected. I have a staff of 17 Bermudians and I hav e business decisions to make.” That is one that I know of. We had a structure that is coming to our firm—15 trusts and companies. But when we got blacklisted they decided not to come to Bermuda. They decided to give us the administr ation, but the companies are going to Guernsey. So, Mr. Speaker , we have here this legislation that provides a tax carveout, but it does not provide for tax residency. And so, in my portfolio, I have a number of companies that are based in the BVI, what this legislation does not do is allow that BVI company to evidence in BVI that it has a residency certificate and does not have to comply with BVI substance. This is important because if we . . . if they cannot demonstrate to BVI that they have substance in Bermuda then t here is no reason for them to stay in Bermuda. And so this is why I say that we are at a competitive disadvantage because other jurisdictions have that certainty. They have their means of demonstrating that companies are tax compliant or resident in their jurisdictions. So I was hoping that we could include a prov ision like that in our legislation, but unfortunately . . . and the Premier was very honest with me. The fact of the matter is that our legislation is preapproved, so we do not have consultation, we have direction . The OECD tells us, This is what we want, this is how we want to see it, and we are just informed of it. So it does not matter what we say in terms of, Well, this isn’t going to work for the industry, this isn’t going to work for the jurisdiction, can we make some amend-ments? And we cannot. And so, you know, we are handcuffed, we cannot do anything, they believe that they are getting money out of the jurisdiction that they are not getting, and to be honest they are cutting off their nose to spite their face. Because when all of the offshore territories go under, they will recognise the revenue that was being brought into their countries from these entities being offshore. Now, Mr. Speaker , the substance legislation was intended to apply to companies who are doing what we call “relevant activities.” And so those rel evant activities are banking, finance, leasing, [and] holding companies. For some reason, Bermuda has amended its legislation so that holding companies mean every single company , every partnership, and every LLC in Bermuda. Every entity that holds or manages assets comes under economic substance, so we do not even have to worry about having a rel evant activity, you are just a holding company, your activity is relevant and you fal l under economic substance. So that needs to be changed. They have a definition in Cayman, they have a definition in BVI, they have a definition in . . . whosie- whatsit . . . Turks and Caicos . So, Mr. Speaker —
[Laughter]
Ms. Leah K. ScottSo, Mr. Spe aker, all I am saying is that the blacklist has really messed us up and really put us behind. And I do not know [if] we can catch up. And we think . . . you know, one of the things that we continue to say is …
So, Mr. Spe aker, all I am saying is that the blacklist has really messed us up and really put us behind. And I do not know [if] we can catch up. And we think . . . you know, one of the things that we continue to say is that if we can get our legi slation on par with at least the other jurisdictions, then we will have a level playing field. But the truth of the matter is that level playing field with Cayman and BVI and all those other jurisdictions, is actually irrelevant, because do you know who we are playing against now? Miami, Hong Kong, the UK, Singapore — onshore —these are who we are playing [against]. And so now, we have to determine what our value propos ition is. Why should somebody come to Bermuda? Trump has reduced the corporate tax, you have got more trusts in Wyoming, Delaware, Nebraska, and more money laundering going on in those places than you do in Bermuda. Have you ever heard of Bermuda being . . . being . . .
An Hon. Member An Hon. MemberCited.
Ms. Leah K. Scott—Cited (thank you) , for a big money laundering case or anti-money laundering? No. But, Mr. Speaker , just the other day, if you do not mind.
Ms. Leah K. ScottDeutsche Bank . . . “Deutsche Bank Faces Criminal Investigation for Potential Money-Laundering Lapses” — [Inaudible interjection]
Ms. Leah K. ScottThat is Trump’s bank, yes. Multiple money -laundering offences and a whistle -blower were disregarded. She put in reports and they were ignored. She was their compliance officer and she flagged these transactions concerning Trump’s and his son- in-law’s, Jared Kushner’s, accounts since 2016. That is not Bermuda. That is …
That is Trump’s bank, yes. Multiple money -laundering offences and a whistle -blower were disregarded. She put in reports and they were ignored. She was their compliance officer and she flagged these transactions concerning Trump’s and his son- in-law’s, Jared Kushner’s, accounts since 2016. That is not Bermuda. That is not Cayman. That is not Turks and Caicos. That is the United States. But we are the bad eggs in the basket. Mr. Speaker , I think it is ridiculous that we have to be subjected to this. And I think that, you know, we look at FATCA . . . now, when we were “s educed” into entering into FATCA arrangements, —
[Inaudible interjection]
Ms. Leah K. ScottSeduced. The US said that by 2017 they would enter i nto reciprocal arrangements so they would do colle c1874 21 June 2019 Official Han sard Report Bermuda House of Assembly tion of data and information. And when we were intr oduced to CRS [Common Reporting Standard], they said that …
Seduced. The US said that by 2017 they would enter i nto reciprocal arrangements so they would do colle c1874 21 June 2019 Official Han sard Report
Bermuda House of Assembly tion of data and information. And when we were intr oduced to CRS [Common Reporting Standard], they said that they would become party to the CRS agreements. Well, we are still waiting. The US has no intention of binding itself or c ollecting information, but they want everybody to provide them with information on US people who are no longer living in the United States. Why should we be the repository, the collectors of their information? We do not get paid for doing it. If you have not managed your administration to the degree that you do not know who is where, whose fault is that? What does that have to do with us as a jurisdiction? Absolutely nothing. So, you know, the imposition of substance is supposed to create this level playin g field, but again, the question is not whether our entities are going to go to the Bahamas or anywhere else, it is are they going to go onshore? And so we need to look at how we create a value proposition for people to come to Bermuda. And I do not know w hat the answer to that is because right now there is nothing that makes us di fferent than anybody else. We do not have an exciting piece of legislation that people say, Well, you know what, I know Bermuda has economic substance, but I’m going to go down there. So there are still several changes that we need to make to our legislation, Mr. Speaker , and those include . . . are we going to make a change to the definition of “holding company” so that the defin ition is confined to pure equity? Are we going to have guidance notes? I understand from the Minister that the guidance notes are almost ready to be released, but those are going to be general guidance notes, they are not going to be industry specific, so we still have got a ways to go for each sector to make their contribution, so finance, banking, trusts, corporate. So how far are we from that when we have got an impl ementation date of July 1, and we cannot provide any guidance to our clients? One of the relevant activities under economic substance is f inancing and leasing. And right now that definition covers trusts. So if I have a trust, and I am renting an apartment or a house to a beneficiary, that is a leasing arrangement. That is a relevant activity, and it is covered under economic substance and i t has to be reported. So when are we going to change that definition? And then what are we going to do to make Bermuda an attractive jurisdiction? How are we going to get people here and how are we going to get them to invest in our country so that we can remain who we are as a jurisdiction? And I think that we are going to have some real challenges ahead of us, Mr. Speaker . I think that, you know, we are all hoping that economic substance is not going to cause capital flight, but we are seeing that it is doing that already. We do not want to see a mass client exodus. But if we do not have a value proposition, and if we do not have legislation that is at least comparable to other jurisdictions, then, you know, I would go set up in the Caymans or the Bahamas because at least I know what I am getting. We do not know where we are going with this. And, you know, the greatest irony is that, Mr. Speaker , research that was conducted last year identified Ireland —not a Caribbean country, Ireland —as the world’s larges t base erosion profit shifting jurisdi ction, and that Ireland had more BEPS than the aggr egate of the entire Caribbean. That is all of the Cari bbean and Bermuda! They do not have economic sub-stance. They are part of the EU; they do not have economic substance. No one in the OECD pays taxes, Mr. Speaker . Did you know that? They are chasing everybody else down for their taxes, and they do not pay taxes. This is a salary and benefits packet for somebody in the OECD. The basic salary . . . with your leave, Mr. Speaker , please.
Ms. Leah K. Scott“ 2The basic salary is specified in the offer letter and is payable in euros, as are all other allowances (family -related allowances, expatriation and installation) . . . Emoluments are exempt from taxation in most Member countries of the Organis ation, including France. “Income tax in the United States: …
“ 2The basic salary is specified in the offer letter and is payable in euros, as are all other allowances (family -related allowances, expatriation and installation) . . . Emoluments are exempt from taxation in most Member countries of the Organis ation, including France. “Income tax in the United States: A specific article (article 3) of the tax reimbursement agreement between the USA and the OECD excludes from the US tax reimbursement programme all OECD official who are liable to pay income tax in the United States . . . . “Income tax in Canada: Officials of Canadian nationality serving at OECD headquarters are exempt on French soil, of income tax on the emoluments they received from the OECD. ” But t hey have the unmitigated gall to expect us to collect their tax debts for them and they do not pay taxes! How is that fair and how is that right? And what I would like to see is for all of the j urisdictions to pull themselves together and tell the OECD, You know what? We’re not doing it. When you start doing it, then we’ll start doing it. But until then, you collect your own data, you collect your own tax, and you let us be to do what we have to do as a juri sdiction.
Ms. Leah K. Scot tThe ultimate goal —and what they have done from TIEAs to economic substance—is to dismantle this jurisdiction. I said it before, and I will say it again. At the end of the day they do not want to see people of colour being successful. They can hide 2 OECD Bett …
The ultimate goal —and what they have done from TIEAs to economic substance—is to dismantle this jurisdiction. I said it before, and I will say it again. At the end of the day they do not want to see people of colour being successful. They can hide
2 OECD Bett er Policies for Better Lives
Bermuda House of Assembly it be hind Google, they can hide it behind whatever they want, but they do not want to see us being successful. But you know what? I hope that people will continue to acknowledge that we are a good jurisdi ction, that we have good legislation, and that somehow, someway, we are able to find our way out of the muck and mire of all of the imposition that has been sent down to us from the OECD and the European Union. And I know that the Premier and the Minister have a tough job navigating through all of this, it has been extremely frustrating for industry, I have vented my frustrations to both [of them] and they have been very gracious and accommodating. But Mr. Speaker , we cannot let the EU and OECD sound the death knell for Bermuda. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you, Honourable Member . Does any other Honourable Member wish to speak? We recognise the Honourable Member from constituency 23.
Ms. Leah K. ScottSorry, Mr. Speaker , could I just declare my interest? I did not say so when I was speaking. I am the President of the Bermuda Associ ation of Licensed Trustees and the General Counsel for Harbour International Trust Company. Thank you.
The SpeakerThe SpeakerAll right. Thank you. We now recognise the Honourable Member from constituency 23. Honourable Member , you have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Speaker . Mr. Speaker , I believe that anybody having listened to my colleague having just spoken, would have a great understanding …
All right. Thank you. We now recognise the Honourable Member from constituency 23. Honourable Member , you have the floor.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Speaker . Mr. Speaker , I believe that anybody having listened to my colleague having just spoken, would have a great understanding and an appreciation of the passion that she brings to this topic because it has been her life for the last two and half, going on three years. It is important to note that when the Minister spoke in his opening remarks, he said there are times that we are required to suspend the process for expe-dience, for pr agmatism, and to avoid harm to our j urisdiction. Very clearly, Mr. Speaker , we on this side of the House wish to support the Government in respect of these amendments that must be made to minimise the down side which has been foisted upon us as a result of not just some of the actions that have been taken, but because of the imposition to which my honourable colleague has just spoken most eloquently and that I do not necessarily need to reiterate. But with that said, I also think, Mr. Speaker , that we have to accept our share of responsibility in terms of finding ourselves in a situation in which now we have to arrange for our legislation to come up to par with other jurisdictions with which we have been in serious competition where their legislation has alr eady been implemented, has been accepted . . . the wor ding has been accepted by the OECD, and now we are having to adjust our legislation to make sure that we come up to scratch. Why are we in this position? My honourable colleague mentioned that if we ha d been able to spend less energy working ourselves off of the blac klist and trying to instil a level of confidence in people who would invest in our country, then maybe we would have been able to look at some of these amendments a little bit earlier. But w hat it looks like now is that by comparison to the BVI, to the Cayman Islands, to Jersey, Guernsey and other overseas j urisdictions, we are effectively sucking hind tit from the perspective of our legislation now having to catch up. Now, one would have thought that as i mportant as this Economic Substance Act is, that when we were looking at the initial implementation of this legislation we should have been examining this 15 ways from Sunday to make sure that we were not b eing disadvantaged and that we were not being put on the back foot vis-à-vis the countries with which we have normal ordinary competition. Notwithstanding that we are required in an inordinate way to now dance to the tune of the EU, the OECD, and ever ybody else, we now have to ask them how high? when they tell us to jump and we ask them how high? when we are on the way up. Mr. Speaker , that is not a satisfactory position for Bermuda to be in. We have worked hard, long, and assiduously, Mr. Speaker , to ensure that our jurisdi ction has been a pristine, blue ribbon jurisdiction such that people want to come to Bermuda, they want to be able to invest here. They want to be able to be conf ident that our infrastructure and our pristine reputation is one that they are gearing towards and not now — perha ps for the first time that I can recall, certainly in my adult life —see that companies are thinking in terms of extricating themselves from our jurisdiction because of some level of deficiency and some uncertainty that they feel in respect of what we have failed to do. The IP issue to which my colleague also spoke is one that ought never to have happened. When that legislation came through and we found that we were told that we had a date certain by which we were required to have representations in by the 24 th (I believe it is) of February, and then, for whatever rea-son, somebody . . . and we do not know whether it was identified by the OECD, whether it was identified by ECOFIN, whether it was identified by us. But there was an omission that was made in our legislation that ought never to have happened. My colleague said if something like that had happened in the private sector, that person would have been turfed out. Why? Because the impact of 1876 21 June 2019 Official Han sard Report
Bermuda House of Assembly that failure to be able to identify something that was crucial to our legislation was overlooked. Now the Premier was gracious in saying he will take responsibility. Well, if the Premier is taking responsibility, then maybe he needs to step down, because that was something that was egregious —
[Inaudible interjection]
Hon. Patricia J. Gordon -Pamplin: —it was egr egious to the jurisdiction, it was harmful to the jurisdi ction, Mr. Speaker , and it is not something . . . it is not something that we can take lightly to be able say, Okay, it happened and now let’s move forw ard, because what is happening now that we are having to move forward is that we are further back down the crease, Mr. Speaker . It is one thing to say let’s catch up with our competitive jurisdictions which are the primary choice of a lot of our investors . But what is happening is that if we are already further back down the wicket . . . they have started down the track, Mr. Speaker . They are in the relay race where they are ready to hand over the baton and we are still just jumping out from the starting l ine. Mr. Speaker , that is not acceptable. I think that what we have to start doing is to stop overlooking incompetence when we see it and call it for what it is, because our jurisdiction is being harmed as a result of the things that have been done or overlooked that we should not be giving a pass to. We should be saying this is not acceptable. Mr. Speaker , very clearly, as I said, we want to be able to support Bermuda being able to ensure that our economy remains stable, that our emplo yment situation i s not diminished and that the actions that we take with our legislative processes are not such that companies have decided— or will decide — that we are not sufficiently certain or confident that setting up in Bermuda is the right thing to do. This has never been a challenge that we have had to face in the past, Mr. Speaker . We have not faced this challenge. We have always boasted that we are the place, we are the blue ribbon, we are the crème de la crème, we want you to come to us. And what has happened, Mr. Speaker ? Now, there are other jurisdictions who have gotten out ahead of us. My question is, at what point in time did we compare on our economic substance what we were trying to do with what already existed in other jurisdictions, such that our legislation did not make us deficient? So, clearly, if BVI and Cayman and Guernsey and Jersey and other jurisdictions have appropriate wording in terms of tax exemptions in their legislation for tax jurisdictions, why are we just catching up? Why did we not either c onsult with, or, at the very least, if we were not going to consult with our competitors (and I can understand that there may be a reason therefore) . . . but if we were not going to consult with . . . at the very least did we not examine their legisl ation to make sure that what we were passing in this Honourable House was appropriate? That is one of the reasons, Mr. Speaker , for our conversation this morning. Because what we are meant to do here is to pass legislation that is good legislation. And irrespec tive of process, that people can get their knickers in a twist because they do not like the way something was done, let us look at the ultimate outcome. Is the ultimate outcome going to inure to the better benefit of all of the people of Ber-muda? Is the ec onomy going to be improved as a r esult of legislation that we implement here? And I cannot see that it has happened in this particular i nstance. Mr. Speaker , we have to make sure that we can just continue to claw our way out, claw our way out, claw our wa y out. And notwithstanding all of the impositions and the restrictions and the requirements that have been foisted upon us by these external agencies, Mr. Speaker , we have to show that we can still hold our own. The bottom challenge that we have with other jurisdictions is many of them have something else upon which they can rely in order to maintain their economies. We do not. We have our reputation, we have our legislation. We do not have any manufacturing. We do not have any other industry, Mr. Speaker . And we have, as I said, historically been the crème de la crème. And now we are scratching to try to reach the top while, you know, the water is boiling beneath us and we are trying to scramble our way out of a boiling pot. And this has been done primarily because, I believe, we have failed to take the necessary steps to ensure that our legislation is not just on the cutting edge, but better than our competitors. We have mind and management and intellect that we have had years and years and years of hist ory. Why are we competing with a jurisdiction such as Ireland for the type of business that we are getting here? Why are we now looking at a challenge with respect to how we are presented in terms of other areas . . . other states in the United States —people from which they used to flee and come to Bermuda be-cause of our preferential ability for them to be able to have proper deployment of their tax dollars. And my colleague is absolutely 100 per cent right, who should be telling us what to do after your money . . . you pay your taxes when you earn your money. If you decide to save it . . . I always have a problem that they charge you taxes on your savings interest because they charge you tax on your primary money when you made it, and then if you have got some thing left over and you decide that you are going to salt it away rather than spend it in the economy, then they charge you . . . that is almost like taxing your twice. And do not worry if you buy a house or something. You buy investments and then you want to rid yourself of those investments, you find yourself in a
Bermuda House of Assembly situation in which you have got to pay taxes on the money that you already paid taxes on to save to get the investment that you have got. And it is just a ne ver-ending cycle. And we are being d ictated to by an environment and an entity that decided that they are not getting enough tax money. That is not good enough. And outside of that, Mr. Speaker , my only other comment that I wanted to make is that when we talk about a competent authority we are required to provide information to a competent authority when so required. “Competent authority” is not defined in the principal Act, and I believe that it might be . . . at least not the copy I have. I do not know if there is a revised copy, but I do not see that “competent authority” has been defined in the principal Act. And I think that that is something, in terms of the interpretation, we might want to ensure that that gets included so that the legislation we finally end up passing looks like something that we would be proud of. Notwithstanding that we are already clawing our way out to try to catch up, notwithstanding that we exerted far too much energy getting off the blacklist than we would have done had we just taken the necessary precautions, had we dotted the i’s and crossed the t’s and not had to come to this Honourable House to make apologies, to be able to say to somebody that, You gave us a date of February 24 th by which we had to comply with your requirements, we find a mi stake after the f act, we complied by the 4th of March, and we have the gall and the audacity and the arr ogance to say, Well, your meeting is not until the 12th, you got the information by the 4th, so we are in compliance. No, we were not in compliance. Mr. Speaker , when I looked at the memo that came from the . . . if I could just, with your permission, Mr. Speaker ? There was a memo from the General Secr etary of the Council of the European Union to the Permanent Representative Committee and the Council and it spoke to how B ermuda had some deficiencies but made a commitment to be able to rectify where our deficiency was in order to be able to comply with their requirements. And in that, Mr. Speaker , the one thing that they highlighted was the fact that Bermuda had i ntended . . . if I can find the exact wording and I do not want to . . . let me see where it is . . . basically to say that Bermuda was meant to comply by a date certain and did not. And that when we did rectify our error that it was too late to get into their meet ing of the 12 th of May . . . no, sorry, 12th of March . . . whatever the date was. The 4th of March was the date that they did it. Their meeting was the 12th of March. We were too late once we did supply that information. Now, with us, with our small size, we do something wrong, we come to Parliament, we put a first, second and a third reading in on the same day, and then we run across the street to the other place and we say, This has got to be done because we have the date certain of July 1 by which this legislation has to come into effect, and it can happen. We are like down the street, we are around the corner, we are across the road and we can do that, Mr. Speaker .
The SpeakerThe SpeakerMm-hmm. Hon. Patricia J. Gordon -Pamplin: But in the context of when you ar e dealing with these major organis ations, such as the OECD, such as the European U nion, you do not have that flexibility. And when they ask you for something by a date certain they mean …
Mm-hmm.
Hon. Patricia J. Gordon -Pamplin: But in the context of when you ar e dealing with these major organis ations, such as the OECD, such as the European U nion, you do not have that flexibility. And when they ask you for something by a date certain they mean it by that date certain. If you are told, Mr. Speaker , that the train leaves at 12:07 and you get to the platform at 12:08 —
The SpeakerThe SpeakerYou are late. Hon. Patricia J. Gordon -Pamplin: —you are lucky if you see the taillights of the train going down the track. They do not wait for you. And we have to understand that notwithstanding, as wonderful as we think we are, we cannot be so arrogant to think …
You are late.
Hon. Patricia J. Gordon -Pamplin: —you are lucky if you see the taillights of the train going down the track. They do not wait for you. And we have to understand that notwithstanding, as wonderful as we think we are, we cannot be so arrogant to think that others will o perate and that we are the axis on which they turn.
The SpeakerThe SpeakerMm-hmm. Hon. Patricia J. Gordon -Pamplin: We are not. We are wonderful, we know we are wonderf ul. We are going to pull out of this because we have the confidence that with mind and management and inte llect and everything else and intellectual property that we possess in our …
Mm-hmm. Hon. Patricia J. Gordon -Pamplin: We are not. We are wonderful, we know we are wonderf ul. We are going to pull out of this because we have the confidence that with mind and management and inte llect and everything else and intellectual property that we possess in our jurisdiction, Mr. Speaker , we know we can come out of this as a country. We know that we are going to be in a position of maintaining a level of employment for our employees. The ones that are going to fall by the wayside in the very short term are going to be those where the companies have not believed that by July 1 we are going to be in a position to satisfy their requirements. Those are the ones who may already have made decisions, as we heard my honourable colleague speak in terms of the correspondence that she had from her colleague who was over in the UK, where they are pulling companies out, pulling trust funds out of Ber-muda because there was uncertainty with respect to the adequacy. That is a black eye for us, Mr. Speaker . We do not like being in this position. And I rue the day that we felt that it was okay to not have the excellence that is required. We do not and should not accept mediocrity. And we should not make excuses for it. We do not have, Mr. Speaker , a bunch of mindless minions who think that mediocrity is okay. We do not. And we should not. We need to demand excellence. We need to make sure that legislation, when it comes, is not just appropriately drafted, but is appropriately vetted so 1878 21 June 2019 Official Han sard Report
Bermuda House of Assembly that once presentations are made to whoever they need to be made, notwithstanding how much we may disagree with them asking, but if we are in the game we have to play by their rules and unfortunately if their rules dictate what we are required to do, then we have to do it. And let us put our arrogance in our pockets and let us move forward for the better good of Berm uda in doi ng things that are appropriate for us, Mr. Speaker , that make sure that we do not find ourselves in the situation that we are today in which we are on the hind foot, basically, trying to appease an environment, an external regulatory environment, because we have done something that is not particularly appropriate. We need to be able to stand up, Mr. Speaker . We talk . . . we boast about punching above our weight, let us show that we can do it, let us show that we cannot just punch above our weight, but that we can make up some of the ground that we have lost by what we have seen—the things that have gone wrong. And that once this legislation is passed, Mr. Speaker , we can continue to ensure that we just continue to gallop down the track to try to make up the ground that we have missed out on. So Mr. Speaker , as I said, apart from looking at the definition in the principal Act, I think it was i mportant to me to get off my chest the fact that we could have been better and we were not. And we have now created and allowed to creep in a level of uncertainty to our business partners that should never have ha ppened. So the fact that we now have to do our first, second and third reading— we accept that, Mr. Speaker . We have to do it. We have to support the Government for it. We should never have been in this position. Thank you, Mr. Speaker .
The SpeakerThe SpeakerNow I recognise the Honourable Member . . . are you yielding? Okay. Honourable Member Commissiong, you have the floor.
Mr. Rolfe CommissiongThank you, Mr. Speak er. Mr. Speaker , the artist Prince had a very popular song, it was called “ Party Like It’s 1999. ” And not only within this Chamber, but beyond this Chamber throughout Bermuda, in some of the most influential offices of Bermuda in the private sector, …
Thank you, Mr. Speak er. Mr. Speaker , the artist Prince had a very popular song, it was called “ Party Like It’s 1999. ” And not only within this Chamber, but beyond this Chamber throughout Bermuda, in some of the most influential offices of Bermuda in the private sector, peopl e are still acting as if it is 1999, as if the international bus iness sector, flexing its muscles in Bermuda, was still going to have its way in a global environment that was conducive to, firstly, its incubation, and then sustained growth throughout that period and beyond. Mr. Speaker , you have heard me speak before in this Chamber. My historical timeline sees the growth of neoliberalism that goes back to around the period of Reagan and Thatcher —the late 1970s, early 1980s to mid- 1980s. But as I have said, I believe that period, that era, ended with the financial collapse of 2008. One of the chief by -products of that period was the growth of these offshore business centres, most of which were in the British Territories region . . . offshore business centres that were on steroids, and Bermuda was no exception. My point is this, Mr. Speaker . We do not seem to be wanting to accept here that that era is over and that the geopolitical sands are shifting and will conti nue to shift considerably. We need to accept that this is the reality we are dealing with. And until we can face that reality I think we are going to have a very hard time reengineering Bermuda in such a way that is going to be reflective of the new geopolitical realities which are establishing them selves even as we speak. And so we had the neoliberal era upon which the formed the rise, subsequently in the mid to late 1980s, of what we now call globalisation—the very ease of capital shifting across borders, the ease of migratory patterns of labour across countries. That was characteristic of that era. But that era is over. I think the Members on the other side . . . I heard the Deputy Leader and the Member from [constituency] 22 [sic], who just sat down—
An Hon. Member An Hon. MemberTwenty -three.
Mr. Rolfe Comm issiongTwenty -three. —who spoke of the rank hypocrisy of, in this case, the European Union, and their imposition of these rules that we now must embed into our own domestic legislation. The hypocrisy, of course, is that those same European elites —both in the government and private sector —were the …
Twenty -three. —who spoke of the rank hypocrisy of, in this case, the European Union, and their imposition of these rules that we now must embed into our own domestic legislation. The hypocrisy, of course, is that those same European elites —both in the government and private sector —were the chief drivers of these offshore centres, such as Bermuda, and the role they played in that global economy. So nothing should indicate to us more that this era is over than those same elites now saying the game is up! Will we reach the point where we will acknowledge that? Just to give an indication to your listeners out there, Mr. Speaker , or our listeners, the other day we had a very successful delegation from BDA along with our very astute and capable Finance Mi nister take a junket to Toronto, Canada. And in the accompanying story the following statistics jumped out to me: In the newspaper it is reported that Bermuda is Canada’s fifth largest export market. I repeat: Bermuda is Canada’s fifth largest export mark et. It is ranked along these lines: the US, UK, Germany, France and Bermuda representing a fifth of trade and services between Canada and Bermuda. Can you believe that? Because I still do not. But it goes to show you the extraordinary role Berm uda has play ed in that global economy. When we talk about Bermuda and the fact that Bermuda has been exporting services each a nnum, each year, to the tune of hundreds of millions of dollars, it has been driven largely by the growth of that
Bermuda House of Assembly international business sector —insurance, risk management, and you can go on down the line. But that is what we are dealing with here. You see, along with the explosion of what I call the neoliberal global economy from the early and mid- 1980s up until 2008, was the extraordinary rise in income inequality, particularly in the same western countries, in Europe and in the US, from which most of this change—this geopolitical change —is occurring. Countries are becoming wealt hier in terms of the explosion in private wealth, but i ncreasingly their governments are becoming poorer and poorer because of the erosion of their tax bases. Yes, it is hypocritical, but they have the power. The Member, again, from Southampton . . . [constituency] 30, is quite right to indicate about the role of the BEP S phenomenon in Ireland. It is extraordinary. I am talking about hypocrisy here. But guess what? Ireland is a member of a club, and we are not. And let me tell you the other thing from a geostrategic perspective that is going to happen. Once the UK leaves the EU —I still think that is going to happen— we are going to be in an even more vulnerable position vis -à-vis the European Union. Because with the UK —despite my reservations about us still maintaining that constitutional link with them —has been a country t hat, within the halls of the European Union, has stood up for measures that have benefited Bermuda and helped to maintain the benign orient ation of the EU towards Bermuda and most of these Overseas Territories that have become leading international offshor e centres. Of course, it was in self -interest. Most of the dominant elements within the UK’s political and ec onomic elites have all benefited from the maintenance and the explosion of these phenomena in these of fshore territories. So let us not act like t hey have exac tly been doing us a favour, but that is the reality of what is called réalpolitique , which is a French expression. Those who have the power will wield it and use it to their own benefit. So I am not going to say that we have lost the public re lations battle. I think I am still going to stay on that ground, which I think is very solid, that the geopo-litical sands have shifted. But I will say this: In the world that is emerging the fact that Bermuda has been able to use its own form of tax arbitr age by maintai ning a 0.0 per cent corporate tax rate increasingly will not accrue to our benefit. And we need to put that script to bed, or bury it, because it is not going to accrue to our benefit to continue to have that as our argument. And Mr. and Mrs . Bermuda have heard the argument so many times —Hey look, we have had that system of taxation for the last 100- odd years ; we did not put it in place to penalise or disadvantage the member countries of the European Union— as if that argument in and of itself now is sufficient to turn the public relations tide our way. And speaking about Mr. and Mrs. Bermuda, I can very well understand how since 2010 or 2011 many of them have been wondering, scratching their heads, as to what we do up here beyond bringing forth legislation to maintain our position geopolitically as a major offshore business centre. Going back to 2010 and 2011 with the TIEAs, Mr. Speaker . . . you were here, and before that. Every other sitting we were dealing with legislative requirements that were being mandated from overseas regulatory powers which had the ability to impose those regulatory stri ctures upon us. Even now, again, many I can understand would think that we do not do the people’s business here. Although this is part of the people’s business. Because while we seek to meet these requirements, and in this case, to ensure that the carveout which disadvantaged us against some of our competing of fshore territories, we are cognisant of the fact that while there may not be a lot of awareness among a significant percentage of Bermudians as to what occurs in IB, we do know that many of our people work in that sector —your uncle, your cousin, your niece, your mother. Do we have enough Bermudians in that sector? After four decades you have heard m y gospel on this, how many times? A thousand over the last 20 years. By this time we should have had the majority of people in that sector as Bermudians, and it should have also reflected our racial demographics as well. So we know there have been major, major, milestones that have never been reached. But, non etheless, it is still a sector that provides jobs and oppor-tunity and brings in significant foreign exchange to these shores. But let us not seek, again, to recreate what we had circa 2003, 2004, 2005, 1998 or as Prince says “1999.” This Government recognises that those geopolitical shifts have occurred and are continuing to occur, [and they] are going to undermine that model. It is already beginning to do so, and there is no going back. And so we are trying to do the hard work of reengineering Bermuda’s economy while ensuring that the bottom is not going to fall out with the pre - existing one. And it is no easy task. And I do not envy the position of our Premier and our new Finance Mi nister in walking t hat tightrope. I would ask Bermudians out there to trust this Government. When you hear criticism coming about our attempts to foster a FinTech- based economy . . . this is part of the reengineering. Bermuda now repr esents a best in class in terms of that growing industry. When you hear us talking about other new and exci ting economic developments that will bear fruit this, too, is part of this reengineering of Bermuda’s econ omy. We have no choice. So Mr. Speaker , I am going to wrap up here and say that I am very happy about the bipartisan n ature of the debate that we are hearing. I thought that the comments, particularly from the Member from 1880 21 June 2019 Official Han sard Report
Bermuda House of Assembly [constituency] 23 and the Member from [constituency] 30, were very, very good . . . their contributions. I hope the spirit continues and that there is a greater realisation that there is no going back, that those sands are shifting, and that we must reengineer this economy in order for us as a country to survive as we continue into the 21 st century, Mr. Speaker . Thank you.
The SpeakerThe SpeakerThank you, Honourable Member . I now recognise the Honourable Member from constituency 11. Honourable Member Famous, you have the floor.
Mr. Christopher FamousGood afternoon, Mr. Speaker , colleagues, the listening public in Bermuda and afar. Mr. Speaker , I am a mechanic by trade so a lot of this stuff sounds like jargon to me. And I am quite sure it sounds like jargon to 99.9 per cent of the other population. …
Good afternoon, Mr. Speaker , colleagues, the listening public in Bermuda and afar. Mr. Speaker , I am a mechanic by trade so a lot of this stuff sounds like jargon to me. And I am quite sure it sounds like jargon to 99.9 per cent of the other population. So I had to get learned- up by various different sources. First of all, I want to thank the Minister. I see some people want to give him a shellacking, but I want to thank the Finance Minister. In one year he has done a magnificent job. I do not see him much because he is constantly on the road promoting Berm uda, helping to transform and protect our economy. So first of all, thank you to him and thank you to his Mini stry because we cannot forget the workers. Mr. Speaker , let me break it down for the pu blic because, again, some may not fully understand the severity of what is going on here. The Overseas Terr itories, which includes Bermuda, BVI, Cayman Islands, to a lesser extent Turks and Caicos and Anguilla, are under threat. They are under constant threat. As a matter of fact, the whole Caribbean is under constant threat through cons tantly changing goalposts by the EU, OECD and whoever else decides, Hey, let’s blacklist this country. Mr. Speaker , through the hard work of the Finance Minister and his team we have gotten our-selves off of a list we should never have been on. But let us look in retrospect, Mr. Speaker . Any given country could end up on the blacklist depending on the mood of some people. I am not calling any names, but some people who were not on the blacklist this time were on the blacklist last time. So there is no disti nct pattern to say . . . as the Honourable Member from constituency 30 has already said, there has been no record of any money laundering charges in Bermuda. None. Thirty per cent of our legislation last year was based on anti -money laundering, being in compliance. So it is not as if we are a lax jurisdiction. Being on the blacklist has caused some challenges for us. I do not work in the industry, but I talk to those that do. It has created some challenges for us. What does it mean to the public? It means a company that may have come here may not come here. It means a house that could have gotten rented, did not get rented. It means the car that could have gotten brought did not get brought. It means the child that might have gone to a private school did not go to a private school. Consequently, it means less money in our economy. That is the crux of the matter here. And if you multiply that by 10 companies, you are maybe looking at 200 different people that are not here . . . maybe. On December 17 th of this last year, 2018, this House in a bipartisan matter met on a Monday to pass the Economic Substance Act, or the first phase I should say, because we understand the threat that is at us. We all understand the threat. But it is for us to continuously educat e the general public about that threat. And you know what is amazing, Mr. Speaker ? I have a daughter, she is 25. She and her friends were WhatsApp’ ing each other and she said, Daddy, my friends are mad at you. Mad at me? Why are they mad at me? Yeah, we ar e on the blacklist now. I am like, What do you mean, we’re on the blacklist now? She said, You know, this is going to be bad for our future. What is my point, Mr. Speaker ? I had to educate her about the depths of what is going on. I had to send her an art icle by the former Minister of Finance, who actually laid out what is really going on. But the point is that our young people grasp the dangers of us being deemed as not in compliance, all right? So we have moved forward in the public knowing . . . public awareness. Let me bring som ething to the public. There are some countries up in England in York called the Crown Dependencies — Guernsey, Isle of Man, and . . . what is the other one?
An Hon. Member An Hon. MemberJersey.
Mr. Christopher FamousJersey, that is it! Crown Dependencies. They are our compet ition. This week they said, Hey, guess what guys? We’re going to sign up for the public register of bene-ficial ownership. What does that mean? That means they are trying to beat us to the punch. So, again, this goes …
Jersey, that is it! Crown Dependencies. They are our compet ition. This week they said, Hey, guess what guys? We’re going to sign up for the public register of bene-ficial ownership. What does that mean? That means they are trying to beat us to the punch. So, again, this goes back to the fact that we possibly will have less people here, less cars brought, less houses rented, or sold in some cases, and our GDP goes down. So we have to be conscious of that. We have to be flexible. Things that we did not consi der 5, 10 years ago we have to consider now. It is called survival. And we will consider that. We are not oblivious to the reality. Here is another reality, Mr. Speaker . As of tomorrow, there is going to be a new Prime Minister in the UK. I will not call the names.
[Inaudible interjection]
Bermuda House of Assembly Mr. Christopher Famous: They what?
[Inaudible interjections]
Mr. Christopher FamousThere will soon . . . let me correct myself. Soon there will be a new Prime Mini ster of the UK. Now, if it is the person who it is most likely going to be, this is the same person that put the UK on a path that they …
There will soon . . . let me correct myself. Soon there will be a new Prime Mini ster of the UK. Now, if it is the person who it is most likely going to be, this is the same person that put the UK on a path that they are on now called “economic turmoil.” So how does the same guy who put them on the path for economic turmoil now become the lead-er? I really do not understand that one. But what is my point, Mr. Speaker ? What does that have to do with the Overseas Territories? That has everything to do with the Overseas Territ ories. We dodged a bullet a few months ago from the Foreign Affairs Committee, they backtracked on the things that they wanted or attempted to put towards us. Are we going to dodge that bullet again with a new leader? Here is the bigger threat, Mr. Speaker . The UK is going to face another general election soon, and if there is a change of Government, the new Gover nment —potentially —[will b e] even less friendly towards the Overseas Territories. So let us reiterate. Prime Minister Theresa May has resigned. There is going to be a new Prime Minister who changes his mind every minute. There is going to be a potential change of Government in the UK who are unfriendly to the Overseas Territories. So all of us in the Overseas Territ ories have to be mindful of this threat —all of us. And we will have to constantly have to . . . unlike what the Member from constituency 30 said, we are really not in a p osition, honestly, to tell the EU, No, we’re not going to comply with you. None of us are, unfortunat ely. So, for the time being, we are going to have to keep adjusting to these constantly changing goa lposts. So, again, I am going to go back to the Mini ster of Finance. I am going to put a challenge to him. The challenge I am going to put to the Minister of F inance is to help to continue to educate the people of Bermuda about these threats. Educate us about why we are doing these Economic Substance Acts. Educate us about the flexibility that we are going to have to [have] in order to survive. Mr. Speaker , I am going to close up here. T oday we had one of those rare forms of bipartisanship, because we are all on the same boat. Some may be in first class, some m ay be in steerage, some may be on the deck, but we are all on that same boat. And I suggest to the Honourable Member s in the Oppos ition, in situations like this, you could leave out the daggers when you are trying to blame somebody in our Ministry because that is irrelevant at this point.
[Inaudible interjection]
Mr. Christopher FamousAt this point it is. Mr. Speaker , I am going to close up here. All of us love the standard of living that we have. We may not like paying the bills we pay, the high pric es. But we have a relatively good standard of living in this …
At this point it is. Mr. Speaker , I am going to close up here. All of us love the standard of living that we have. We may not like paying the bills we pay, the high pric es. But we have a relatively good standard of living in this country. This Economic Substance Act and all the other Acts that are going to follow are what we need to maintain our standard of living. Thank you, Mr. Speaker , and thank you, Mr. Finance Minis ter.
The SpeakerThe SpeakerThank you, Member. Any other Member? I recognise the Honour able Member from constituency 36. Honourable Member Scott, you have the floor. Hon. Michael J. Scott: Thank you, Mr. Speaker . Mr. Speaker , very briefly I would like to also begin by noting what has been done and what …
Thank you, Member. Any other Member? I recognise the Honour able Member from constituency 36. Honourable Member Scott, you have the floor.
Hon. Michael J. Scott: Thank you, Mr. Speaker . Mr. Speaker , very briefly I would like to also begin by noting what has been done and what has been accomplished by the amendments being brought by Minister Dickinson this evening. So I take a slightly different tack from that b eing taken by the spokesperson for the OBA, Ms. Gordon-Pamplin. The very fact that by a simple legal fi ction introduced into the legislative language at clause 2 of this Bill, that redefines what an “entity” is, som ething that was not done in the 2018 Bill admittedly, but, you know, one swallow does not a summer make. Nor does one little glitch of omission from a piece of legislation leave us in a world of trouble. We have the capacity in this country —always have had the capac ity in this country, in this Island, this territory —for ha ving a reputation in this area of wealth management and responding to the challenges, whether they be from Delaware or from the EU, of responding adroitly and deftly. And today is a perfect example of that. And I think that the Minister should take heart in the fact that he, with his leadership and his team responding and the private sector with whom he has consulted, pr oducing this simple legal fiction to address a carveout and an exemption is something that we should be commending ourselves about, as opposed to the narrative which should not be dictated to us by the Honourable Member Patricia Gordon- Pamplin that we are scrambling back and trying to claw our way back. Bermuda has an excellent set of materialities on which to call upon, we always have. The creation of this low tax territory and the herd eff ect that it has had historically in this country, a low tax regime, a clean jurisdiction, as opposed to, as was noted by the honourable spokesman for Finance, Ms. Scott, when she cited Deutsche Bank and the presence of the vast amounts of deleterious conduct that we find on the American seaboard, compared or contrasted with Bermuda. We can leverage these contrasting valueaddeds in this country in quick time, as I submit has taken place over the last little [while], led by our Mini ster of Finance, Mr. Dicki nson. 1882 21 June 2019 Official Han sard Report
Bermuda House of Assembly And so I take a different view. I believe that we should be deploying the very build- up of the intellectual capital that we have residing in Bermuda, the mind and management and presence of client services offered over all of these years, and the pow er and thought power that it gives us to be responsive. That is what we should be focusing on. And there is little point . . . and I agree with my colleague, Mr. F amous. There is little point in carping. Rather, we should have a task group assessing what t he value is of this EU proposition in any event. For example, is this economic substance policy really going to result in more capital ending up in European cities? If that is a real flaw or an assessed or an alysed flaw or weakness in their policy, that begins to provide us with solutions as to whether what they are seeking to do, just by way of subaltern policy from afar to jurisdictions that they fear or predict as threats to their tax base, if it really is a policy that is weak, then our analysis should make that analysis that it is, and then continue to look for the solutions, continue to look for answers to reposition ourselves so that their efforts —their meagre, weak, un- thought -through efforts—are less impactful on us. That is where I think and I beli eve is where we should be devoting our time, our intellectual capital and prowess and energies, as opposed to spending too much time criticising or be-ing critical of ourselves or saying that we are scrambling back. We have never had to scramble back. This country, the jurisdiction that the current Minister of Finance has inherited and taken over, is a noble one, is one that has . . . we have never . . . I have never . . . I have watched this space for a long time in Bermuda growing up here. And this is a rare occurrence—a piece of legislative glitching that has put us or repositioned us adversely. And I say again, the fact that we . . . and the speed with which we have recovered is testament to the strength of the jurisdiction and our prowess. And focus on that, and then do better than just focus on it, deploy in a task group, the way that we had a task group that led and looked into FinTech, deploy a task group that looks for ways to both leverage our strengths of low tax, a jurisdiction that can be pr eferred to jurisdictions that wealth prefers to reside in where the jurisdiction is clean and has a reputation for good regulation and sensible and reasonable regul ation. For you see in . . . and both Mr. Commissiong and Mr. Famous spoke about this. Mr. Johnson may . . . will soon be the change of guard in Britain; Trump, President Trump will also change, he is not going to be around forever. So when Mr. Commissiong speaks of the geopolitical sands being ever with us, one of the important factors about the geopolitical sands to which my colleague referred, is the quality closely associat-ed with these geopolitical sands is their volatility and their ever quick -moving nature. And these present opportunities for countries like Bermuda who have been accustomed to res ponding quickly to changing circumstances in which we can find opportunities, Mr. Speaker . So we may, with this very need to deploy our intellectual power, as has happened over the last few weeks within Chambers and with the Minister of F inance and his te am at the Ministry of Finance to devise a simple legal fiction and introduce it into the amendment today. This is an opportunity for us to d eploy in equal terms, Mr. Speaker —in equal terms — new and even more far -reaching and effective pos itioning policy to fend off any future developments of these geopolitically fast -moving sands and to exploit them . . . and to exploit them, Mr. Speaker . So Ms. Gordon- Pamplin should not be setting the narrative for us that we are . . . to be fair, she acknowledged what I h ave acknowledged that mind, management and client services present here have given us great, great practical power —the thought power, the experience in the industry of wealth man-agement, insurance, et cetera—has given us . . . and that is what we should be crowing about, focusing upon, and both deploying and exploiting in the quiet of the hours when we are at our day’s work so that t oday’s legal positioning, just in simple amendments, is expanded, leavened with new yeast, to really position us to positions that we have not even yet thought about or come up with to deal with the changing world in which we find ourselves. So the time is prime, Mr. Speaker , for Berm uda to deploy our know -how, our prowess intellectually, and to exploit the herd effect of this low tax, clean j urisdiction to make an assessment of the apparent threat from this churn that has been deliberately dri ven, possibly even a clearly thought -through churn d eliberately foisted upon us by the EU, and come up with better and improved mousetraps . . . or just one mousetrap if that is all it takes. Mr. Speaker , Facebook has recently made this important announcement of the Libra to pay for its products and services. Mr. Speaker , Mr. Zuckerberg has generated with his team Libra, which is intended to be currency that can be transferred via that social media platform with its value based on a basket of real life currencies rather than on cryptocurrencies. This is yet an ideal example, Mr. Speaker , of the geopolitically shifting sands that are taking place in our world and the opportunities that therein reside. And I only mention it in the context that the environment into which this amendment that we are discus sing now fits should be one that does not cause us to shrink like violets but to acknowledge our well - deserved capacities for being adroit and responsive and using the strengths of our reputation that has been ours to enjoy over these years. And at the same time, yes, to innovate and to come up . . . but not to be caught up in, Oh, we are behind. It reminds of the
Bermuda House of Assembly Trump thing about Make America (or Bermuda) Great Again! We have always been good at this. We have always been good at this, and we should quickly adjust, change the gear into fourth, and keep coasting at a good speed so that we do the work for the people of this country and generate the revenues for the consolidated fund more and deploy our revenues [for] education and seniors and health care and all of the i mportant areas that make our life in Bermuda one that is the envy of the world. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you, Honourable Member . Does any other Honourable Member wish to speak? We recognise the Honourable Member from constituency 10. Honourable Member Dunkley, you have the floor. Hon. Michael H. Dunkley: Thank you, Mr. Speaker . Mr. Speaker , first off I want to thank my co lleagues, the …
Thank you, Honourable Member . Does any other Honourable Member wish to speak? We recognise the Honourable Member from constituency 10. Honourable Member Dunkley, you have the floor.
Hon. Michael H. Dunkley: Thank you, Mr. Speaker . Mr. Speaker , first off I want to thank my co lleagues, the Honourable Member s Ms. Scott and Mrs. Patricia Gordon- Pamplin, for their presentations. I think it was refreshing to hear the representative from constituency 30 give a perspectiv e after declaring an interest of what she and the industry face generally because it is something that the listening audience certainly would appreciate when we come to the debate in this House. I think it was also important that my colleague from constituency 23 laid it out as, I guess I think it would be appropriate to say, as only she can do. But Mr. Speaker , in following this debate t oday it appears to me, in my context, that Bermuda has gone from being a leader in many instances to being a follower. A nd I will come back to that as I get through the comments that I want to make today, but Mr. Speaker , in December of last year (the Honourable Member from constituency 11 referred to the original debate that we had) I made some comments which I will not re peat directly. But in the context of what I said Mr. Speaker , we live in a dog- eat-dog world, that ev ery jurisdiction wants a part of another jurisdiction that is successful, or every jurisdiction that sees another jurisdiction that is successful wants to try to undermine that jurisdiction or make it more difficult for them to do work. And then we live in a world, Mr. Speaker , not only is it dog eat dog . . . and we know how dogs can turn on each other sometimes as best of friends and have a scrap or something —
[Inaudible interjection]
Hon. Michael H. Dunkley: Mr. Speaker , interpolation from my side of the House was quite funny. But not only will friendly dogs turn on each other from time to time, but we live in a world now where alphabet groups will say, No, no, no, no, don’t do as I do, do as I say . And it is quite interesting if you look at, as my honourable colleague did, at what taxes other jurisdictions place on themselves and how they criticise you . . . it makes you wonder and scratch your head. So Mr. Speaker , we know because not too long ago we sat on that side of the House and we were well aware of the challenges and we were well aware that no matter what you do, that bar will conti nually rise or that playing field will continually get re-jigged for its boundaries, Mr. Speaker . And that is very concerning and that means that we will continue to come back to this honourable place, with regularity, to deal with these types of legislation which are critically important to our community. And yes, we realise that the Government is in a rush because of the importance to the industry. It is critically important to the industry. We have done our work on this side and we have talked to people within industry so we understand the critical importance it is to them. And as you have heard through this debate, Mr. Speaker , there already has been some seepage to what we would expect to be business that would be comfortable here in Bermuda and would be comfort able going forward. And we need to arrest that as quick ly as we can. But some of the damage has been done and I do not think any one of us in this House could stand here today, Mr. Speaker , and say that with this piece of legislation the seepage will end because this is just a continuation of what will take place. It is also, in light of the rush because of the importance of the industry, Mr. Speaker , it is important because the economy seems to be weaker now than it has been in previous years —because of some seepage, because of attacks from other parts in the world. There is no doubt we have seen many param eters that show that our economy is weakened to some extent. So, Mr. Speaker , we come here today, we have been through why we are having the first, second and third readings, and I hope the Honourable Financ e Minister, when he has an opportunity to wrapup at the end of this debate after listening to the de-bate, can perhaps put a little bit more context about how we got to this position. I tried to listen closely and I tried to make some notes, but I still have some questions out there. Because the Honourable Finance Mi nister said that he met in April with the EU, a few days later he put in writing the challenges that we had, and then about 10 days ago the Minister said he spoke on the phone and then legislati on was drafted, Mr. Speaker . So I appreciate that context, Mr. Speaker . But what I would like to know, because I did not hear it during this debate, is when was this problem first identified, Mr. Speaker ? I think that is a critical part for us to understand, because my colleague, the Honourable Member from constituency 30, I believe, said that this was 1884 21 June 2019 Official Han sard Report
Bermuda House of Assembly preapproved legislation. Because my honourable colleague said that it was requested to the Premier that a draft be put forward with an amendment. And the r eply back was that this could not be the case because this legislation was preapproved. Now Mr. Speaker , if that is the case, this is a serious challenge in itself and a serious acknow ledgement in itself because if we now are dealing with the EU on the bas is of preapproved legislation, that always allows that we will be a follower and not a leader, Mr. Speaker . That always allows, Mr. Speaker , that we will be under severe time constraints to rush into judgment.
The SpeakerThe SpeakerYes, you may. POINT OF CLARIFICATION
Ms. Leah K. ScottAnd maybe I did not . . . I guess, say it correctly. Essentially, before we can enact any legisl ation, what we draft has to go to the OECD, so that is . . . so they have to d etermine whether or not what we are putting forward …
And maybe I did not . . . I guess, say it correctly. Essentially, before we can enact any legisl ation, what we draft has to go to the OECD, so that is . . . so they have to d etermine whether or not what we are putting forward is going to be acceptable to them. So, I do not know if that is what your meaning is of “preapproved.” And so if I did not explain it correctly, then I just wanted to clarify that. Okay.
The SpeakerThe SpeakerThank you, Honourable Member . Hon. Michael H. Dunkley: Thank you , Mr. Speaker . I appreciate the opportunity for my honourable colleague to try to clarify. [Inaudible interjections ] Hon. Michael H. Dunkley: That does not . . . Mr. Speaker , that does not change the context of …
Thank you, Honourable Member . Hon. Michael H. Dunkley: Thank you , Mr. Speaker . I appreciate the opportunity for my honourable colleague to try to clarify. [Inaudible interjections ] Hon. Michael H. Dunkley: That does not . . . Mr. Speaker , that does not change the context of what we are facing here today and with our relationship with some of these overseas bodies. It is clear now that they want to look at ever ything we are doing before we do it, Mr. Speaker . Therein itself lies a challenge, Mr. Speaker , because this body —
Hon. Curtis L. Dickinson: Mr. Speaker , Mr. Speaker , point of order.
The SpeakerThe SpeakerYour point of order, yes. POINT OF ORDER [Misleading] Hon. Curtis L. Dickinson: The Honourable Member is misleading the House. I was going to sit and sta y quiet and then wrap -up at the end giving some more detail around timelines, but clearly this conversation is going way off …
Your point of order, yes.
POINT OF ORDER [Misleading]
Hon. Curtis L. Dickinson: The Honourable Member is misleading the House. I was going to sit and sta y quiet and then wrap -up at the end giving some more detail around timelines, but clearly this conversation is going way off track. And so let me . . . can I . . . if you . . . with your indulgence—
The SpeakerThe SpeakerProvide the clarity. Hon. Curtis L. Dickin son: —provide some context. When the Bill . . . when the legislation was passed last year, I had concerns expressed to me by numbers of members from the industry groups around Bermuda. I committed at the time to address concerns once we …
Provide the clarity.
Hon. Curtis L. Dickin son: —provide some context. When the Bill . . . when the legislation was passed last year, I had concerns expressed to me by numbers of members from the industry groups around Bermuda. I committed at the time to address concerns once we had heard from the EU with respect to their judgment on our legislation. Bermuda, for the record, had tried to work with other Overseas Territories jointly in crafting our legislation. We spoke, and then people stopped cooperating. So this notion that we went off on our ow n, doing our own thing being arrogant, is not true. It has no basis in fact. Once the EU rendered its judgment, we were advised by Her Majesty’s Treasury to not change our legislation until we were off the list. And given that we had been on the list, and everybody wanted to get off the list as soon as possible, we followed that advice.
[Inaudible interjection]
Hon. Curtis L. Dickinson: Well—
The SpeakerThe SpeakerWell, make your point and then you can have your seat and you can finish that when you do your wrap- up. Hon. Curtis L. Dickinson: Okay. Thank you.
The SpeakerThe SpeakerThank you. Member? Hon. Michael H. Dunkley: Thank you, Mr. Speaker . Mr. Speaker , that is helpful information. That would have been helpful at the start of the debate. Now, Mr. Speaker — [Inaudible interjections ]
The SpeakerThe SpeakerJust speak to the Chair . . . speak to the Chair, do not get sidetracked. Hon. Michael H. Dunkley: Mr. Speaker , no, I will not be sidetracked. The interpolations from that side show that you are hitting the point, Mr. Speaker . So Mr. Speaker , I appreciate …
Just speak to the Chair . . . speak to the Chair, do not get sidetracked.
Hon. Michael H. Dunkley: Mr. Speaker , no, I will not be sidetracked. The interpolations from that side show that you are hitting the point, Mr. Speaker . So Mr. Speaker , I appreciate from the Honourable Finance Minister that when the legislation was passed last year the advice given was to go through the process and do things in what would be (my words) the most appropriate time for doing it. And if
Bermuda House of Assembly we had had that information earlier through this pr ocess it would have helped. Now, in regard to the Overseas Territories, if Bermuda needs to go on its own to get some things done as far as legislation is concerned, if other Over-seas Territories or ot her bodies that have like interests to us do not work with us, we should go on our own. I do not know where that word “arrogant” came from, but arrogant is not the right word. We are protecting our people’s interests, which is important, Mr. Speaker. When I sat and had the responsibilities as Premier it was sometimes difficult to get other territ ories to go with us in certain areas, because they ten ded, at times, to want to keep their head below the parapet so it did not get shot, when we knew there was an issue on the horizon, Mr. Speaker . And Bermuda has always been the place that will deal with issues when they come up, or before they come up if we see that happening, Mr. Speaker . So if we have to go and leave other people behind, we will have to do so, Mr. Speaker , because it is very clear that this legislation today has our full support. You will probably have few questions in Committee about it because we understand the simple nature of it, Mr. Speaker . But we also understand the severe impact to our industry here and to our economy. Now, we will come back to this House any time there is a need or an opportunity to do something if we have to have a first, second and third reading as long as we are kept in the loop on it, Mr. Speaker . But today is not th e end of where we go from here, Mr. Speaker , because it is very clear to us that as we go through this process our relationship with the bodies that we have to deal with for this type of legislation is not as strong as it should be. And what do I mean by that? It means that they tend to want to dictate to us rather than to listen to our point of view. And that is not a healthy relationship to be in, Mr. Speaker . And as far as the Government is concerned, I am sure they know that they have the full support of the Opposition in trying to turn that relationship so that there is a better understanding of what we do in our jurisdiction and so that there is more opportunity for us to protect our interests going forward and to further our interests going forward, M r. Speaker . The precept of the current arrangement is not going to work because we cannot just keep jumping and drafting and coming to this House to pass legisl ation that is under strict timelines and legislation that is critical to our community. And so w e are here today to do exactly that. But if we continue to go forward wit hout leading, more in a following mode, we will have very difficult months and years ahead, Mr. Speaker . We heard Honourable Member s from that side talk about a FinTech- based economy and exci ting new developments in our economy, Mr. Speaker . If the Government —any Government —is sidetracked with last -minute changes that have to be made under very difficult timeframes, it takes away from the crucial important need of expanding our economy , taking care of opportunities, or seizing opportunities before other people seize those opportunities, Mr. Speaker . Now, Mr. Speaker , the last point I want to make here as I speak . . . and it is a reflective point, Mr. Speaker , because I think you have s een over the past couple of months an Opposition who does their role differently than the former Opposition, the PLP. And what do I say by that, Mr. Speaker ? Mr. Speaker , if the shoe was on the other foot today, and the OBA was over there and the PLP was over here, what would the approach have been for the PLP in its Opposition on this legislation?
[Inaudible interjection]
Hon. Michael H. Dunkley: And the Honourable Member Zane De Silva says (from constituency 29) we would not be saying anything but supp ort. Hon. Zane J. S. De Silva: Of course. Hon. Michael H. Dunkley: Mr. Speaker , I can tell you that Honourable Member would have been on a rant . . . he would have . . . there would have been a verbose conversation so loud, louder than last week or the w eek before, that the roof would have come off this place, Mr. Speaker . But this Opposition has been pinpointed with their support and made some valid criticism, Mr. Speaker .
Hon. Walter H. Roban: Fantasy.
Hon. Michael H. Dunkley: Now I hear the Deputy Premier say Fantasy! No, Mr. Speaker , because there was important legislation that came through this House and it was made political all the time. We are not going to make politics over this legislation b ecause it is for the good of our people, Mr. Speaker . It is for the good of our people, Mr. Speaker , so we are going to be here to support this. But what we will say, Mr. Speaker , is that we need to change the context of the relationship with the EU because right now they have our tail and they shake it and they wag it, Mr. Speaker , and that is not going to be healthy because we will back here again and again and again.
[Inaudible interjections]
Hon. Michael H. Dunkley: Now, Mr. Speaker , the Honourable Member s on the other side would like some suggestions on what we would do about it. Well, the first thing that could happen, Mr. Speaker , is to get the Opposition involved a little bit earlier than Sunday afternoon, Mr. Speaker .
1886 21 June 2019 Official Han sard Report B ermuda House of Assembly [Inaudible interjections] [ Gavel] Hon. Michael H. Dunkley: Get the Opposition i nvolved a little bit earlier — [ Gavel]
The SpeakerThe SpeakerMembers, Members! Hon. Michael H. Dunkley: —than Sunday afternoon. Hon. Zane J. S. De Silva: Point of order.
The SpeakerThe SpeakerMembers, Members! Hon. Zane J. S. De Silva: Point of order, Mr. Speaker.
The SpeakerThe SpeakerMembers! POINT OF ORDER [Misleading] Hon. Zane J. S. De Silva: Point of order, Mr. Speaker. The Honourable Member is certainly misleading the House, because he just asked a question and he did not even come to the meeting he was invited to . . . if he cares so …
The SpeakerThe SpeakerThank you. Continue on. Hon. Michael H. Dunkley: Mr. Speaker —
The SpeakerThe SpeakerContinue on . . . Members. Hon. Michael H. Dunkley: —that is the most ridic ulous point of order because — Hon. Zane J. S. De Silva: It is t rue, though. Hon. Michael H. Dunkley: —the Opposition Members were invited to the meeting. Hon. Zane J. S. De Silva: …
Continue on . . . Members. Hon. Michael H. Dunkley: —that is the most ridic ulous point of order because — Hon. Zane J. S. De Silva: It is t rue, though. Hon. Michael H. Dunkley: —the Opposition Members were invited to the meeting. Hon. Zane J. S. De Silva: Why didn’t you go? Hon. Michael H. Dunkley: There are two comments I want to make to that, Mr. Speaker. I was off the I sland, Mr. Speaker . The invitation to the meeting came when?
An Hon. Member An Hon. MemberTuesday morning. Hon. Michael H. Dunkley: Tuesday morning for Tuesday afternoon, Mr. Speaker . Hon. Zane J. S. De Silva: Hey, you got an invite. Hon. Michael H. Dunkley: Mr. Speaker, notificati on came to the Opposition on Monday. Hon. E. David Burt: Point of order, Mr. Speaker .
The SpeakerThe SpeakerI will take a point of order. POINT OF ORDER [Misleading] Hon. E. David Burt: That Honourable Member is misleading the House. And I am not certain if the OBA Opposition is not talking to the UBP Opposition, but we clearly spelled it out with the Honourable Member who is …
I will take a point of order. POINT OF ORDER [Misleading] Hon. E. David Burt: That Honourable Member is misleading the House. And I am not certain if the OBA Opposition is not talking to the UBP Opposition, but we clearly spelled it out with the Honourable Member who is the Acting Opposition Leader. [ Inaudible interjections] Hon. Michael H. Dunkley: Mr. Speaker, he—
The SpeakerThe SpeakerContinue on. Hon. Michael H. Dunkley: The Honourable Premier said misleading the House, but he did not give a comment on how [it was] misleading the House, Mr. Speaker . Mr . Speaker , it is very clear — [ Inaudible interjections]
The SpeakerThe SpeakerMembers, Members! Hon. Michael H. Dunkley: —that the Government contacted the Opposition on Sunday — Hon. Zane J. S. De Silva: You just said Tuesday afternoon, make up your mind! Hon. Michael H. Dunkley: Check the Hansard, go check t he Hansard. You k now yo u are—
The SpeakerThe SpeakerMembers! Hon. Michael H. Dunkley: You are incorrect so much you cannot r emember w hen you are correct. [ Gavel]
The SpeakerThe SpeakerSit down, sit down. We are not going to have this conversation going back and forth between two Members. If an ybody wants to talk, you talk to me. Talk to the Chair; not to the Members across the floor. Hon. Michael H. Dunkley: Thank you, Mr. Speaker . Sometimes …
Sit down, sit down. We are not going to have this conversation going back and forth between two Members. If an ybody wants to talk, you talk to me. Talk to the Chair; not to the Members across the floor. Hon. Michael H. Dunkley: Thank you, Mr. Speaker . Sometimes interpolations are just too good to leave alone, Mr. Speaker .
Bermuda House of Assembly The Speaker: Well, you have got to be bigger than that.
Hon. Micha el H. Dunkley: So, Mr. Speaker , the Go vernment —
The SpeakerThe SpeakerYou have got to be bigger than that. Hon. Michael H. Dunkley: —wanted advice as to how we could work through this situation. Contact the Opposition earlier. We are willing to work with you to work through issues of national importance. [Inaudible interjection]
The SpeakerThe SpeakerMember. Hon. Michael H. Dunkley: But contacting us at the last minute will lead to challenges in making this hap-pen in the right way. And Mr. Speaker , as it has happened b efore on a piece of legislation, it does not allow the time for the Opposition to look …
Member. Hon. Michael H. Dunkley: But contacting us at the last minute will lead to challenges in making this hap-pen in the right way. And Mr. Speaker , as it has happened b efore on a piece of legislation, it does not allow the time for the Opposition to look at it, and mistakes can happen. There is legislation that has come to this House in a rush and we have had to come back and amend it. Now, Mr. Speaker , this is a pretty straightforward piece of legislation, so that probably will not happen in this case. But if the Government wants some advice, contact us earlier, contact us as soon as they know there is a rush to judgment on this issue and we would be willing to sit and get together. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you. Is there any other Member? I recognise the Premier. Premier, you have the floor. Hon. E. David Burt: Thank you, Mr. Speaker . Mr. Speaker , my comments are going to be brief. And the . . . it is very interesting because . . . and it …
Thank you. Is there any other Member? I recognise the Premier. Premier, you have the floor.
Hon. E. David Burt: Thank you, Mr. Speaker . Mr. Speaker , my comments are going to be brief. And the . . . it is very interesting because . . . and it is . . . I know that the Honourable Member s opposite have forgotten what it is like to be in Opposition and they have been there for two years. But there is just the very nature of this political system which we have, and some of the nature of it is that they are u ninformed. And that is just the way that the system works sometimes. But I can assure you that when we talk about value for money, the Government is certainly getting value for money from the Honourable Mi nister of F inance and the amount of work and energy and effort which he has been putting into this particular instance. And what I can say, Mr. Speaker , is that I do not want to necessarily say that the Opposition speaks with forked tongue. But we understa nd the various constituenc ies that we represent. We understand quite plainly, simply and clearly that the Hon-ourable Minister of Finance has been consulting with business organisations back and forth on these particular matters —the Registrar of Companies, the task force which has been established. The Honourable Deputy Opposition Leader is nodding her head because she knows. And these are the types of consul-tations which have been going on for many, many, months, Mr. Speaker . So I find it interesting and r ich that, clearly, the people who the Members opposite attend cocktail par-ties with would have filled that in. That is just a fact, Mr. Speaker . Clearly the people opposite who are, you know, whose names are part of the law firms, who are inside of these m eetings, would have filled them in. The fact is, Mr. Speaker , that when we had a draft Bill, it was shared. Now, Mr. Speaker , I am uncertain if the Honourable Minister of Finance went through the process to get here, but we are dealing with multiple differ ent things here. We are dealing with the OECD, we are dealing with the EU, we want to make sure that we get these things right and it is a very delicate balancing act. Here is the fact. The fact is that during [the time] the original economic substance it ems, [when] these particular measures were put forward, some of the challenges which we had, the tax residency issue which some persons spoke about if we saw it in other people’s legislation, why wasn’t it in our legislation? We specifically asked for thes e carveouts from the European Union. And at that point in time the tec hnical officers denied them. This is not the first time that I have said that in this House, Mr. Speaker . It is not. We specifically stated that —and it is something that is known— and the people on the task force and others know and u nderstand that, Mr. Speaker . We went back and the Honourable Minister of Finance stated very clearly that once the listing decision was made we will look to do the level setting that was required. It was every intention to have this piece of legislation done earlier. But guess what, Mr. Speaker ? The Ministry of Finance this week is in Paris for an OECD Forum on Harmful Tax Practices assessment and the OECD is the one that is running the process for measuring ec onomic substance. And, therefore, we wanted to make sure that we were in line with the OECD and we could not get that answer until Wednesday, Mr. Speaker , in wri ting. Those are the facts. Now, guess what, Mr. Speaker ? As the Honourable Minister of Finance said, you have to be flex ible. And I appreciate the flexibility of the Deputy O pposition Leader who was at a wedding while I was at a football game and having to chat, and understanding and recognising and the letters being sent to the not ifications so that people were clear, Mr. Speaker . The fact is that we all know that when finance legislation comes to this House dealing with our international business sector, both sides of the aisle hold hands. 1888 21 June 2019 Official Han sard Report
Bermuda House of Assembly But let us be clear, Mr. Speaker , this is not r eally Mr. and Mrs. Smith’s business. You are not going to find economic substance written inside of a Pr ogressive Labour Party platform. You are not going to find the people who are challenged with the challeng-es in the economy and the challenges with housing and other things talking about economic substance. And so time is taken from Mr. and Mrs. Smith’s agenda to focus on these matters. But they are done and they are pushed through. Now, Mr. Speaker , here is what is interesting. All of these items were explained in t he briefing session. Ministry officials were made open and there were numerous questions that were asked. We make sure that we have these sessions, Mr. Speaker , to make sure that the information is shared and so there can be no questions so we can come her e, and i nstead of the sound and fury —
Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker .
The SpeakerThe SpeakerI will take your point of order. POINT OF ORDER [Misleading] Hon. Patricia J. Gordon -Pamplin: Yes. I think the Honourable Member is mislea ding the House in terms of all information being shared in the briefing sessions because I will have to say that the . . . we …
I will take your point of order.
POINT OF ORDER [Misleading]
Hon. Patricia J. Gordon -Pamplin: Yes. I think the Honourable Member is mislea ding the House in terms of all information being shared in the briefing sessions because I will have to say that the . . . we received a draft copy of the legislation, which would be the basis of the meeting that we held, and on that draft copy of the legi slation we were told that we were not meant to share that outside. So with that prescription to not share that legislation we did not even have the opportunity to go and speak to people in industry with whom we might otherwise have been able to communicate and consult.
The SpeakerThe SpeakerOkay. Hon. E. David Burt: Okay, Mr. Speaker , now I am getting to the point, because there was something that was breaking back and forth. The Ministry of Finance consults with industry as a matter of course. That is what happens. That is it. And so the consultations happened …
Okay. Hon. E. David Burt: Okay, Mr. Speaker , now I am getting to the point, because there was something that was breaking back and forth. The Ministry of Finance consults with industry as a matter of course. That is what happens. That is it. And so the consultations happened with the outside bodies already. They are part of the task force. The legislation was shared with the Opposition so that the Opposition could be aware of what would be coming here for debate. But the policy and those items were already shared. And as the Deputy Opposition Leader indicated when she gave her speech and understood, these processes where we are bringing legislation here is legislation which has already been preapproved as meeting the guidelines and the test. That was the clarification which we got during the various items. Now, Mr. Speaker , this stuff is difficult. But here is the fact, Mr. Speaker . We are a part of the global economy. We have committed to having an insurance industry. We have committed to EU So lvency II. We have committed to being part of the OECD’s Forum on Harmful Tax Practices. The fact is, Mr. Speaker , as global rules change, we will have to change as well. That is a fact. So the sound and fury from Members opposite in some way saying that we should just ignore global rules, it is almost as though . . . what are you trying to say? We understand where we are, industry understands where we are, and I am hopeful that the Opposition understands where we are. This legislation here today is something that we would have loved to have brought earlier. Again, we would have loved to have brought this earlier. But because of the very strange timing between the OECD Forum on Harmful Tax Practices assessments and the deadline, that is the reason why it was not able to be brought and/or tabled before this time, Mr. Speaker . It is that simple. Sometimes these things happen. And Members opposite compare us to other jurisdictions all the time. There was no sound and fury in BVI when they cal led a special session and passed their Economic Substance regime in one sitting. There was no sound and fury in Cayman where they had a special session and passed their Economic Substance regime in one sitting.
An Hon. Member An Hon. MemberNope. Hon. E. David Burt: But here this is what we have, Mr. Speaker . We hold hands on these items . . . I remember when I was Shadow Minister of Finance and there was a Minister of Finance on this side, and when things came dealing with these …
Nope.
Hon. E. David Burt: But here this is what we have, Mr. Speaker . We hold hands on these items . . . I remember when I was Shadow Minister of Finance and there was a Minister of Finance on this side, and when things came dealing with these matters we say on financial matters we hold hands. And I would hope that the former Premier, who just said that the Oppos ition would act differently, would just cast his mind back and remember how we got through the multiple pieces of financial legislation and all those various items and all the blacklist that happened under the former administration and all the rest. Those are the facts.
Some Hon. Member s: Rubbish. Rubbish.
Hon. E. David Burt: Oh, you do not remember a blacklist from France that happened while you were in office?
Some Hon. M ember s: Ooh! Ooh!
[Inaudible interjections] Hon. E. David Burt: Really? Let’s be clear. These things happen all the time, Mr. Speaker , all the time.
Bermuda House of Assembly That is the nature . . . that is the nature, Mr. Speaker , of being in Government. We accept the responsibility, and we will co ntinue to press on. But what is clear, Mr. Speaker , is that some persons on that side get it, and some persons on that side do not. And those who want to continue to play politics can do so, but I would hope that at one point in tim e the two separate Oppositions can speak as one in this House as opposed to us having to listen to the OBA Opposition and the UBP Oppos ition. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you. Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker .
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading] Hon. Patricia J. Gordon -Pamplin: Yes, the Honourable Member is misleading the House. We do not have two Oppositions. We have one OBA Opposition. And while he may want to score— [Inaudible interjec tions] Hon. Patricia J. Gordon -Pamplin: —political points in respect …
Point of order.
POINT OF ORDER [Misleading]
Hon. Patricia J. Gordon -Pamplin: Yes, the Honourable Member is misleading the House. We do not have two Oppositions. We have one OBA Opposition. And while he may want to score— [Inaudible interjec tions]
Hon. Patricia J. Gordon -Pamplin: —political points in respect of that, it is important for the record to e nsure that this is clarified. Thank you, sir.
The SpeakerThe SpeakerThank you, Member. Does any other Member wish to speak? We recognise the Leader of the Opposition. Honourable Member , you have the floor. Hon. L. Craig Cannonier: Yes, thank you, Mr. Speaker . I think enough has been said back and forth and I am sure that the public …
Thank you, Member. Does any other Member wish to speak? We recognise the Leader of the Opposition. Honourable Member , you have the floor.
Hon. L. Craig Cannonier: Yes, thank you, Mr. Speaker . I think enough has been said back and forth and I am sure that the public has had enough information—
[Inaudible interjections]
The Speake r: Members!
Hon. L. Craig Cannonier: —to make some determ ination. I will say that all of us in the Opposition recognise that this has to be done. If Members were clear, there has been some concern and asking of questions as to how we got to the point that we are that we would have to have a last minute briefing concerning matters without, of course . . . in having that briefing suggestions were put forward. And, unfort u-nately, because of the time factor some of those were not even . . . well, none of them were able to be incorporated or even considered because of the time factor. And I think that is part of where the concern is, that if we are going to be consulted . . . then consult ation means that maybe we have some ideas as well and we would like to present them and maybe for those to be considered. But this was a fait accompli. So if we are going to have consultation, just come out and say this is a fait accompli, this has to be done and there is no adjusting of it and the likes, and we are going to move forward. And I think that is where some of the challenge is. What I wanted to do just briefly was to clarify for the public . . . I listened to the Premier saying that Mr. and Mrs. Bermuda are really not going to understand this and I take exception to the Premier actually saying that, because what invariably will happen, as we listened to the Honourable Leah Scott read an email on how companies were going to potentially pull out, that is Mr. and Mrs. Bermuda who are going to lose their jobs. And so for the Premier to get up and make such a statement, quite frankly, is very concer ning, because Mr. and Mrs. Bermuda stand the risk of losing their livelihoods. And so what we need to do is we need to e nsure that, as far as possible . . . I have a lot of fait h in the Finance Minister as he continues on with the work that he needs to do. I believe that we can do better as far as consultation is concerned. We have had some great consultation, actually. But in notification, I think that we probably could have bee n notified a bit sooner, considering the fact that this was already a done deal. And so I get the thrust of going back and forth. But I wanted to make those points. Mr. and Mrs. Bermuda need to know what is going on, especially when we are talking about an industry that contributes over 80 per cent to our GDP. That is scary that we would not explain what is going on to the public. And I know that the Finance Minister will continue on and get out to the public and ensure that they understand. But that is a major, major issue if we are going forward and we are not letting the public be aware. I wanted the public to know, Mr. Speaker , of the symbiotic relationship that we have with jurisdi ctions that fall under the EU and under the even broa der branch of the OECD. There was a study that was done back in 2013, I believe it was, by a company out of Washington DC. And that company basically stated this: that Bermuda had a symbiotic relationship with Britain . And it mentioned many other jurisdictions as well, but I am just highlighting the relationship with Britain. It said that Bermuda and the core business that it partakes in supports —and I want Bermuda to hear this very clearly —supports over a hundred tho usand jobs in the UK. Talk about a symbiotic relationship. What we do as a jurisdiction here in Bermuda supports a hu n1890 21 June 2019 Official Han sard Report
Bermuda House of Assembly dred thousand jobs! In addition, it went on to explain that not only a hundred thousand jobs, but it is gene rating over $1.4 billion annually . Talk about a symbiotic relationship. And so from both sides of the House —from the Government and from the Opposition— we have heard how we feel that this is very egregious, that we continue to jump through hoops. And it is concerning for us because it, quite frankly, is an attack on Mr. and Mrs. Bermuda, because as we see the decline in retail sales, that all is connected directly to the industry that we are talking about because they are spending money. This is all connected. The other thing that I wanted to point out about this is that in my travels prior, when we were Government with our Finance Minister Bob Richards (the former Minister), we had this thing that we used to say to the Brits about a public register. And I just wanted to speak to clarify. I was listening very intently as the Honourable Member Famous was talking about Jersey and Guernsey and their going public with their register. We used to say you go first because whoever goes first, loses. And I believe, quite frankly, that because these jurisdictions are going with a public register it really is a strategic move to force and push us in that direction. It is beneficial for us not to have a public register. That is why companies wish to come to Ber-muda. And so I just wanted to make sure that the public understood that, with some of these jurisdictions going that route, it is certainly is not to their be nefit at all. We need to maintain the fact that we will . . . we have got a register and, quite frankly, how . . . I would like to know how the United States and Britain and the likes, who hav e no clue of a register and who owns what . . . it is going to take them a decade just to get all of that information together and to able to com-ply by 2023, or whatever that year is. It is going to take a magical feat in order to accomplish that, Mr. Spea ker. So, again, I want Bermuda to understand as they travel that the symbiotic relationship that we have and the business that we do creates hundreds of thousands of jobs across the EU jurisdictions. And it, quite frankly, is very egregious to see us in t his pos ition. We are in this position and that is why we are calling for, as you have heard from some of our Members, there are . . . people expressing their feelings on the Opposition side. We are all on the same page. But what we would like to see is som e forthcoming . . . and time to be able to present things and to consult, not over five days. And I was looking through my phone and the Premier said he called me, and I have no calls from the Premier at all, you know. And then he said he emailed me, well , okay, I do not see any emails here so I am not sure what address he emailed it to. He has emailed me before. But I have no emails at all. Now that could be because I was travelling and ma ybe there was a mix -up there at the time, I do not know, but —
[Inaudible interjection]
Hon. L. Craig Cannonier: No, I am not making excuses. But we are in support, Finance Minister. We want him to know that. We are a bit concerned about the timing because of this. And we also recognise that because we are or we were bl acklisted, close scrutiny is being placed on Bermuda. I mean we were termed as being “tricky.” We still have not gotten to the bottom of why they termed us or coined us as being “tricky.” I would like to understand what they are tal king about. No one seems to be able to clarify that. Why were we being tricky? So, again, Mr. Speaker , we will move forward and we will support the Finance Minister as he moves forward to get this stuff done, but we will not stop [as king] questions and being concerned about timi ng as we move through these very important issues that face Bermuda. Thank you, Mr. Speaker .
The SpeakerThe SpeakerI do not see any other Member moving. Minister, would you like to wrap- up? Hon. Curtis L. Dickinson: Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank y ou. Hon. Curtis L. Dickinson: I am not going to respond point by point to everything that has been said. I think that to some degree the back and forth has been kind of exhausting for us in here and for some of us liste ning. But what …
Thank y ou.
Hon. Curtis L. Dickinson: I am not going to respond point by point to everything that has been said. I think that to some degree the back and forth has been kind of exhausting for us in here and for some of us liste ning. But what I would like to say is this blacklisting, for the two months that it happened, was clearly not ideal for us. And none of us would have wished, if we could do it all over again, to have had to suffer through this experience for a second time. But it happened. And we have to de cide as a country whether we are going to move beyond it and figure out how we move forward in a constructive way, or whether we are going to allow this to be the equivalent of a shac kle around our ankles. I heard comments about how this blacklisting is causing companies to leave. No one knows for certain why companies choose to leave. Companies choose to leave all the time. It is inappropriate—
Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker .
The SpeakerThe SpeakerPoint of order? Bermuda House of Assembly POINT OF ORDER [Misleading] Hon. Patricia J. Gordon -Pamplin: Yes, the Honourable Member is misleading the House. For clarity, we do know why companies leave because, notwithstanding that companies may not choose to share with the Minister of Finance the reasons why they …
Point of order?
Bermuda House of Assembly POINT OF ORDER [Misleading]
Hon. Patricia J. Gordon -Pamplin: Yes, the Honourable Member is misleading the House. For clarity, we do know why companies leave because, notwithstanding that companies may not choose to share with the Minister of Finance the reasons why they have elected to leave, they certainly share with us. And that is one of the reasons why it is important to have the consultation so that we can help to quell some of the anxieties that companies have, to show that we are in support of what the Government is trying to do.
The SpeakerThe SpeakerThank you. Minister? Hon. Curtis L. Dickinson: Mr. Speaker , again, companies choose to leave Bermuda all the time. And we can choose to surrender or we can . . . I hear comparisons all the time about how people are upping an d leaving and going to Cayman, and …
Thank you. Minister? Hon. Curtis L. Dickinson: Mr. Speaker , again, companies choose to leave Bermuda all the time. And we can choose to surrender or we can . . . I hear comparisons all the time about how people are upping an d leaving and going to Cayman, and they are upping and leaving and going to other places. And I am a believer in this concept that there are many, many bodies that have responsibility for helping to move this country forward. It is interesting that when we run into periods of challenge there seems to be an expectation that Government needs to be the one doing all the rowing in the right direction. And what I say is this: Companies come here because we are a beautiful jurisdiction, we have . . . it is a lo vely place to come and do business, we have a great reputation. And we also have a number of really, really, high- quality, outstanding service providers. They are not just here because they like the Island. They are here because they have relationships wit h people who provide excellent service. And so, when we hit a bump in the road . . . as I ask my children when they complain about a problem, Now what ? Are we going to surrender? Or are we going to fight like we have always fought? The fact of the matter is the world today is different than it was 30 to 40 years ago. And we have made it our reputation . . . we have made it our stock in trade to adapt as a country to the circumstances that we find ourselves facing. These threats from the EU or the OECD are not going to stop. And we should not allow these threats to stop us from being what we are. We should adapt, we should show our innate ability to be innov ative, our ability to kind of provide good service and good solutions —things that have made us succes sful over the course of the last five or six decades, . . . actually longer than that. We should continue to kind of push forth with those things instead of cowering our heads and kind of crying, Woe is me. With that, Mr. Speaker , I move to commit the Bill. The Speaker: Deputy? [Pause]
House in Committee at 4:14 pm
[Hon. Derrick V. Burgess, Sr., Chair man]
COMMITTEE ON BILL
ECONOMIC SUBSTANCE AMENDMENT ACT 2019
The ChairmanChairmanMembers, we are now in Committee of the whole House for further consideration of the Bill entitled the Economic Substance Amendment Act 2019 . Minister, you have the floor. Hon. Curtis L. Dickinson: Mr. Chairman, the Ec onomic Substance Am endment Act 2019 amends the Economic Substance Act 2018 by …
Members, we are now in Committee of the whole House for further consideration of the Bill entitled the Economic Substance Amendment Act 2019 . Minister, you have the floor.
Hon. Curtis L. Dickinson: Mr. Chairman, the Ec onomic Substance Am endment Act 2019 amends the Economic Substance Act 2018 by creating an exem ption for Bermuda registered entities that are registered in another jurisdiction for tax purposes. This means that the Act will not apply to an entity that is registered in Bermuda and engaged in a relevant activity and provides sufficient evidence that it is resident for tax purposes in another jurisdiction. The information received by the Registrar will be pr ovided to the foreign competent authority of any rel evant EU member state or other jurisdiction with which Bermuda has entered into an agreement. Mr. Chairman, I would like to move clauses 1 through 4.
The ChairmanChairmanYou may. Continue. [Inaudible interjections]
The ChairmanChairmanContinue. Hon. Curtis L. Dickinson: Clause 1 is t he standard citation clause. Clause 2 amends section 2 by amending a “non- resident entity,” and defines a “non- resident ent ity” as an entity which is resident for tax purposes in a jurisdiction outside Bermuda that is not in Annex …
Continue. Hon. Curtis L. Dickinson: Clause 1 is t he standard citation clause. Clause 2 amends section 2 by amending a “non- resident entity,” and defines a “non- resident ent ity” as an entity which is resident for tax purposes in a jurisdiction outside Bermuda that is not in Annex 1 to the EU list of non- cooperative jurisdictions, i.e., a blacklisted jurisdiction. Clause 3 inserts a new section 5A requiring a non-resident entity that carries on a relevant activity, that claims to be a resident for tax purposes in anot her jurisdiction, to provide evidence of such tax res idency for each relevant financial period. Clause 4 amends section 6 by adding two new subsections: (1A) and (2A). Under subsection (1A) the Registrar is required to provide the competent authority the information provided to him by a non-resident entity, i.e., evidence of tax residency claimed in another jurisdiction. Subsection (2) is 1892 21 June 2019 Official Han sard Report
Bermuda House of Assembly amended to require the competent authority to provide information received from the Registrar in relation to an entity that is in breach of the Economic Substa nce requirements for a relevant financial period as well as a high risk IP entity to a relevant jurisdiction, not just a relevant EU member state. Subsection (2A) requires the competent authority to provide information received from the Regi strar in relat ion to a non- resident entity to a relevant jurisdiction, not just an EU member state. The words “or other jurisdiction” are also inserted after the words “EU member state” in subsections (3) and (5).
The ChairmanChairmanAny further speakers? The Chair recognis es the Deputy Leader of the Opposition. Ms. Scott, you have the floor.
Ms. Leah K. ScottThank you , Mr. Chairman. I recognise (and I think we have batted this back and forth) that we really do not have the opportunity to make any changes to this legislation. But I just would like to have it on the record that, while we are supporting the legislation, …
Thank you , Mr. Chairman. I recognise (and I think we have batted this back and forth) that we really do not have the opportunity to make any changes to this legislation. But I just would like to have it on the record that, while we are supporting the legislation, I do hope that at some point in time we can actually address the carveout and provide some sort of definition that allows companies that are here to evidenc e that they are tax resident in Bermuda so that they do not have to form substance in other jurisdictions. Thank you, Mr. Chairman.
The ChairmanChairmanAny further speakers? The Chair recognises the Honourable Member Pat Gordon- Pamplin. You have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, I am referring specifically to clause 4 —
The ChairmanChairmanFour. Hon. Patricia J. Gordon -Pamplin: —and this is on the second page under [new] subsection (1A) in which we specify that “Wi th respect to a non- resident entity, the Registrar shall provide . . . the competent author ity.” And I noted in the earlier debate that there …
Four.
Hon. Patricia J. Gordon -Pamplin: —and this is on the second page under [new] subsection (1A) in which we specify that “Wi th respect to a non- resident entity, the Registrar shall provide . . . the competent author ity.” And I noted in the earlier debate that there was no reference in the description to “competent authority” and I just wondered whether the Government would want to ensure that the principal legislation e ither includes that, or perhaps if he could explain why it is important or why it is not necessary to include it. Thank you.
The ChairmanChairmanMinister, do you want to respond to that? Hon. Curtis L. Dickinson: Yes, sir. Addressing questions in the order in which they were given, with respect to further amendments to the legislation, I committed to industry, the various industry stakeholders, in December and have reitera ted this commitment in my …
Minister, do you want to respond to that? Hon. Curtis L. Dickinson: Yes, sir. Addressing questions in the order in which they were given, with respect to further amendments to the legislation, I committed to industry, the various industry stakeholders, in December and have reitera ted this commitment in my subsequent engagem ents with them over the course of the last five, six months that I will undertake to make the relevant amendments to the legislation to ensure that Bermuda is not placed at a competitive disadvantage. That will include consideration of the issues with respect to kind of defining whether a company is tax resident in Bermuda or not. The process for us making amendments to this legislation has been divided up into two general phases. The first phase is to address those things that needed immediate fixing, and the second being all of the other issues. And in due course we will work t owards resolving those differences. With respect to the definition of a “competent authority,” I noted the Honourable Member ’s point earlier and I would refer her to the substantiv e legislation section 6(5) which sets out the definition for what a “competent authority” is.
The ChairmanChairmanMs. Gordon- Pamplin, are you okay? Mm-hmm. Yes? Hon. Curtis L. Dickinson: If you do not mind, Mr. Chairman, I would like to give her . . . The Ch airman: Oh, yes. It is okay? Hon. Patricia J. Gordon -Pamplin: Yes, I am satisfied with this. I just had …
Ms. Gordon- Pamplin, are you okay? Mm-hmm. Yes? Hon. Curtis L. Dickinson: If you do not mind, Mr. Chairman, I would like to give her . . . The Ch airman: Oh, yes. It is okay? Hon. Patricia J. Gordon -Pamplin: Yes, I am satisfied with this. I just had looked for it in the interpretation section under the alphabetical —
The ChairmanChairmanRight. Hon. Patricia J. Gordon -Pamplin: —segment, and I did not see it there and that was the reason I asked the question. But, thank you, I appreciate the information from the Minister.
The ChairmanChairmanAny further speakers? Minister, do you want to move the clauses? Move the preamble first . . . no, the clauses, first, sorry. [Crosstalk]
The ChairmanChairmanYes, just move that the clauses be approved. Hon. Curtis L. Dickinson: I move that all four clauses be approved.
The ChairmanChairmanYes. It has been moved that clauses 1 through 4 be approved. Bermuda House of Assembly Are there any objections? There appear to be none. Approved. [Motion carried: Clauses 1 through 4 passed.] Hon. Curtis L. Dickinson: I move that the preamble be approved.
The ChairmanChairmanIt has been moved that the preamble be approved. Are there any objections to that? There appe ar to be none. Approved. Hon. Curtis L. Dickinson: I move that the Bill be r eported to the House as amended— The Clerk: As printed. Hon. Curtis L. Dickinson: —as printed.
An Hon. Member An Hon. MemberNo amendments.
The ChairmanChairmanIt has been moved that the Bill be reported to the House as printed. Are there any objections to that? There appear to be none. The Bill will be r eported to the House as printed. [Motion carried: The Economic Substance Amen dment Act 2019 was considered by a Committee …
It has been moved that the Bill be reported to the House as printed. Are there any objections to that? There appear to be none. The Bill will be r eported to the House as printed. [Motion carried: The Economic Substance Amen dment Act 2019 was considered by a Committee of the whole House and passed without amendment.]
House resumed at 4:22 pm
[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]
REPORT OF COMMITTEE
ECONOMIC SUBSTANCE AMENDMENT ACT 2019
The SpeakerThe SpeakerGood afternoon, Members. Is there any objection to reporting to the House the Economic Substance Amendment Act 2019 as printed? No objections. So moved. That now brings us on to the next item on the Order Paper, which is the third item we are doing t oday but listed as …
Good afternoon, Members. Is there any objection to reporting to the House the Economic Substance Amendment Act 2019 as printed? No objections. So moved. That now brings us on to the next item on the Order Paper, which is the third item we are doing t oday but listed as [Order] No. 5. It is the Electricity Amendment Act 2019 in the name of the Minister of Home Affairs. Honourable Minister, would you like to present your matter?
Hon. Walter H. Roban: Yes, thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you. BILL SECOND READING ELECTRICITY AMENDMENT ACT 2019 Hon. Walter H . Roban: Mr. Speaker , I would like to move that the Bill entitled the Electricity Amendment Act 2019 be now read a second time.
The SpeakerThe SpeakerAny objections to that? None. Continue, Minister. Hon. Walter H. Roban: Mr. Speaker , I rise to intr oduce the Bil l entitled the Electricity Amendment Act 2019 to be read for a second time. This Bill seeks to amend the Electricity Act 2016 to expand the requir ements for …
Any objections to that? None. Continue, Minister. Hon. Walter H. Roban: Mr. Speaker , I rise to intr oduce the Bil l entitled the Electricity Amendment Act 2019 to be read for a second time. This Bill seeks to amend the Electricity Act 2016 to expand the requir ements for granting consent to the transfer or assignment of licences. Mr. Speaker , you will be aware that in my Mi nisterial Statement on the 7th of June, I indicated that I was tabling this Bill to assure the proper regulation of the electricity sector, particularly after the announc ement was made that the Ascendant Group was for sale. Mr. Speaker , I must reite rate that I have every confidence that the RA (the Regulatory Authority) will perform the due diligence required prior to making a decision on whether to approve the transfer of any licence, particularly now that the team is led by Chief Executive Mr. Dent on Williams. You will note that under his stewardship a number of long- standing issues have either been completely or are currently out for public consultation. These include the Integrated R esource Plan (IRP); the granting of new Integrated Communications Operating Licenc es (ICOLs); and Consumer Protection Standards and Open Internet. Mr. Speaker , I am sure that Honourable Member s have seen the educational advertisements featuring the RA’s cow. Although some might tire of the cow advertisements, I find them quite entertaining and informative. This is all in keeping with the consumer protection mandate of the RA to engage and to promote the interests of [the] consumers of Bermuda. However, Mr. Speaker , you will be aware that things have not always gone that smoothly at the RA. History has instructed us that in any organisation there should always be adequate checks and balances. Mr. Speaker , it is important to remind Honourable Member s that section 6 of the Electricity Act 2016 defines the purposes of the Electricity Act; namely, “to seek — “(a) to ensure the adequacy, safety, sustai nability and reliability of electricity supply in Bermuda so that Bermuda continues to be well positioned to compete in the 1894 21 June 2019 Official Han sard Report
Bermuda House of Assembly international business and global tourism markets; “(b) to encourage electricity conservation and the efficient use of electricity; “(c) to promote the use of cleaner energy sources and technologies, including alternative energy sources and renewable energy sources; “(d) to provide sectoral participants and e ndusers with non- discriminatory interconnection to transmission and distribution systems; “(e) to protect the interests of end- users with respect to prices and affordability, and the adequacy, reliability and quality of electricity service; “(f) to promot e economic efficiency and sustainability in the generation, transmission, distribution and sale of electricity.” Mr. Speaker , these are admirable purposes that also underscore the commitments made to the people of Bermuda by this Government in the 2018 Throne Speech, including addressing high energy costs and increasing the uptake of renewables. Mr. Speaker , I must also remind Honourable Member s that section 8(1) of the Act provides me with the authority, as the Minister, to “issue Ministerial d irections to the Authority regarding any matter within his authority respecting the electricity sector.” Section 8(2) states that “Ministerial directions shall be designed with due regard to the purposes of this Act.” Mr. Speaker , I issued Ministerial directions to the RA on the 19 th of March, after we were informed by the Board of Ascendant Group Ltd. that they i ntended to sell the company. While I do not intend to repeat all the verbiage in my directions to the RA, I would like to highlight the following paragraphs, which are important to this debate: “Pursuant to section 15 of the Act, in dischar ging your functions, including the consideration of any change in ownership of any licensee under the Act or of any proposed concentration under section 87 of the Regulatory Act 2011, you must act in a manner consistent with the purposes of the Act as set out in section 6. As we discussed and, as you would know from statements made by the Government” (and I am continuing to quote from my directions here, Mr. Speaker ) “the Government is concerned with ensuring that the above purposes are met and that, in particular, where possible, section 6(e) which speaks to the purposes of protecting ‘the interests of end- users with respect to the prices and affordability and the adequacy, reliability and quality of electricity service’ is given the hig hest priority, provided there is no detriment to section 6(a) which speaks to ‘adequacy, safety, sustainability and reliability of electricity supply in Bermuda.’ “I expect that while the Author ity considers whether to grant its consent to any transfer of owner-ship, as delineated in section 30 of the Act, deliber ations consistent with this direction will provide add itional layers of diligence, which we have discussed and will better safeguard the interests of the rate - payers and further strengthen the application of the Act. “Please note that this direction in no way o bviates any of the other regulatory processes estab-lished around the transfer of ownership of any lice nsee, but rather adds to th e process.” Mr. Speaker , now to the Bill at hand which amends section 30 of the Act. The amendment pr ovides that: 1. An Integrated Resource Plan (IRP) must be approved under section 44(2) and published under section 45 of the Act and that due r egard is had t o the IRP when the Authority makes its decision whether or not to give con-sent. I would like to highlight section 44(2) which states that “The Authority may approve the Integrated Resource Plan if, acting in accordance with the regulatory principles and a ny administrative determinations, it considers that the final draft Integrated R esource Plan is the best approach to meeting the pur-poses of the Act and complying with Ministerial directions.” 2. Requires the Authority to consult the Minister and obtain his approval before it consents to the transfer or assignment of the TD&R (the Transmission Distribution and Retail) Licence or a Bulk Generation Licence. 3. The Minister may refuse his approval, but only if he is satisfied that the Authority’s intended consent t o the transfer or assignment is not in accordance with Ministerial directions. Mr. Speaker , after my Ministerial Statement of the 7 th of June, concerns were raised that the sale of Ascendant Group does not require a transferee l icence because it is Ascendant Group being sold and not BELCO. However, I would like to draw Honourable Member s’ attention to section 30(2) which states: “Transfer includes change in control of the licensee, where ‘control’ refers to” (and this is defining what change in control is i n some effort in clarity) “(a) the power, whether held directly or indirectly, to exercise decisive influence over a licence holder, including by directing its management and policies, whether through” —
Ms. Leah K. ScottExcuse me, Mr. Speaker . Could you just reference the legislation?
The SpeakerThe SpeakerSure, point of clarification. Bermuda House of Assembly Ms. Leah K. Scott: Just the legislation, which section? Hon. Walter H. Roban: Section 30(2).
Ms. Leah K. ScottOf the? Hon. Walter H. Roban: Of the Electricity Act.
Ms. Leah K. ScottOh, okay. Hon. Walter H. Roban: I will restart with where I was reading about transfer: “(2) Transfer includes change in control of the licensee” (this is section 30(2) so that the Honourable Member can follow where I am going) “where ‘control’ refers to— “(a) the power, whether held directly …
Oh, okay. Hon. Walter H. Roban: I will restart with where I was reading about transfer: “(2) Transfer includes change in control of the licensee” (this is section 30(2) so that the Honourable Member can follow where I am going) “where ‘control’ refers to— “(a) the power, whether held directly or ind irectly, to exercise decisive influence over a licence holder, including by directing its management and po licies, whether through ownership of shares, stocks, or other securities or voting rights, or through an agree-ment or arrangement of any type, or otherwise; or “(b) the ownership of 25 percent or more of the shares, stocks, or other securities or voting rights , including through an agreement or arrangement of any type.” The proposed sale of Ascendant Group does reflect a change in control of the licensee as described in section 32 [sic] .
Ms. Leah K. Scott[Section] 30 subsection (2). Hon. Trevor G. Moniz: Not 32. Hon. Walter H. Roban: [Section] 30 subsection (2).
Ms. Leah K. ScottThank you . Hon. Walter H. Roban: If I misdirected . . . or persons were confused by my remarks, I apologise. It is [section] 30 subsection (2).
Ms. Leah K. ScottOkay. Hon. Walter H. Roban: [Section] 30, in brackets, (2).
Ms. Leah K. ScottThank you . Hon. Walter H. Roban: Mr. Speaker , I hope that is helpful to Members, and I apologise to Members who are listening who may have been confused by that.
Ms. Leah K. ScottOkay , thank you. Hon. Walter H. Roban: Mr. Speaker , finally, I have repeatedly noted in my previous statements regarding this matter that the BELCO plant is a strategic asset, which is used by all residents of Bermuda. It is critical to our social and economi c well -being. …
Okay , thank you.
Hon. Walter H. Roban: Mr. Speaker , finally, I have repeatedly noted in my previous statements regarding this matter that the BELCO plant is a strategic asset, which is used by all residents of Bermuda. It is critical to our social and economi c well -being. Therefore, it is the duty of this Government to ensure that any pr oposed sale will promote economic efficiency and sus-tainability in order to reduce our reliance on fossil fuel, increase the use of renewables and make electricity more affordable for all residents. Mr. Speaker , before I conclude I would like to recognise the stellar work of the team at the Attorney General’s Chambers who worked on this Bill to its fruition, and also the work of the Permanent Secretary of Home Affairs, Ms. Rozy Azhar, who has worked tir elessly to deal with these issues as they have come to the attention of the Ministry and working with Chambers to make sure that the work that we had to do around this very important issue of the potential sale of the Island’s onl y utility has become an issue and a matter for the Government to consider. So I thank all those who have been involved in the work around this matter and the work that will continue, Mr. Speaker . Mr. Speaker , I now move that the Bill entitled the Electri city Amendment Act be read for a second time and put to the House for consideration. Thank you.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish to speak? I recognise the Deputy Opposition Leader. Honourable Member , you have the floor.
Ms. Leah K. ScottThank you , Mr. Speaker . Mr. Speaker , I guess the major concern that I have about the legislation is the fact that the RA was set up to be an independent body. And I am not sure that injecting politics into the RA by allowing the Mini ster …
Thank you , Mr. Speaker . Mr. Speaker , I guess the major concern that I have about the legislation is the fact that the RA was set up to be an independent body. And I am not sure that injecting politics into the RA by allowing the Mini ster to approve licences . . . kind of impedes upon the independence of the Authority. And I guess I am questioning the timing of the legislation because BELCO has been up for sale since last year, so why are we just bringing this legi slation forward now?
Hon. Walter H. Roban: Point of order, Mr. Speaker .
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading] Hon. Walter H. Roban: I do not believe the Honour able Member is intentionally misleading . . . the announcement of the sale of BELCO only came this year. And I do not believe they had made any announcement to sell their company …
Point of order.
POINT OF ORDER [Misleading]
Hon. Walter H. Roban: I do not believe the Honour able Member is intentionally misleading . . . the announcement of the sale of BELCO only came this year. And I do not believe they had made any announcement to sell their company until early 2018 . . . the actual process and the announcement of their clear intent to sell came earlier this year, March to be exact.
Ms. Leah K. ScottFair comment, but I t hink that the Minister actually rightly said that we were aware of 1896 21 June 2019 Official Han sard Report Bermuda House of Assembly negotiations, I guess, since 2018, whether or not this announcement came in 2019. So I guess the real issue is that …
Fair comment, but I t hink that the Minister actually rightly said that we were aware of 1896 21 June 2019 Official Han sard Report
Bermuda House of Assembly negotiations, I guess, since 2018, whether or not this announcement came in 2019. So I guess the real issue is that we should have had a finalised IRP so that whoever is acquiring the shar es knows exactly what they are getting. And the concern is that when this takes place, will our rates change? Is staffing going to change? Will there be unexpected operating costs that were not antic ipated? The other thing is that the amendment, as far as I can see, tends to allow for Ministerial overreach. And the Minister does have, under the Electricity Act, as he cited, the ability to provide Ministerial direction as he also does under the Regulatory Act. So I guess the purpose of having an ind ependent body is to allow for them to be able to make decisions and, generally, when you have independent bodies you try to constitute them with people who have the necessary skills and expertise and knowledge to be able to run whatever sector they are supposed t o be responsible for. So it is concerning when you have people that are devoting their time to contribute to the running of the Authority and to ma king decisions to, essentially, then be micromanaged because whatever they do or whatever efforts they expend can then be overturned by the Minister. So I am hoping that the RA will be left to do their job. I know this is one of those situations where the Opposition will have their say but the Government will have their way and that there really is not anything that we can do to make any changes. But I think it is important that we start understanding and respecting the independent bodies that we have set up. This is now the fourth, I guess, instance where we are having a piece of legislation amended to allow for the Minister to be able to exercise some control or some insight. So we need to determine if we are going to have truly independent bodies, if they are going to be independent, or we are just going to have Gover nment have control over everything rather than having bodies set up, give them independence, only to have it reversed. And I actually do not really have anything ot her than that to say, Mr. Speaker . As I said, although we may not agree with the legislation, it will pass. And I just hope that the RA will be able to do an effective job, notwithstanding that at the end of the day the Mi nister has the ability to make a decision in terms of the transfer of the licence. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you, Member. Does any other Member wish to speak? I recognise the Deputy Speaker. Honourable Member , you have the floor. Hon. Derrick V. Burgess, Sr.: Thank you, Mr. Speaker . Mr. Speaker , I really appreciate and thank the Minister for bringing this amendment to give the Go …
Thank you, Member. Does any other Member wish to speak? I recognise the Deputy Speaker. Honourable Member , you have the floor. Hon. Derrick V. Burgess, Sr.: Thank you, Mr. Speaker . Mr. Speaker , I really appreciate and thank the Minister for bringing this amendment to give the Go vernment of the day the final approval on any sale of BELCO. We all know that BELCO is a so- called private company. And I say “so- called” because BELCO . . . their electricity really should be nationalised. And so they . . . we cannot continue to leave ourselves open to a priv ate company that can do almost what they want. And I am just hoping one day that the Gover nment, even if we start now, that the Government should acquire some interest in BELCO, with the eventuality down the road of taking it over or at least having at least 51 per cent of the shares in BELCO. Some sort of figure where we can have a say, because we should have a say. Water, electricity, [and] housing is essential to any country, Mr. Speaker . Mr. Speaker , I am also happy about this because I think Government should be requesting of any company, such as BELCO, will we continue to have Bermudians . . . will their jobs be protected? Will we have a Bermudian CO? We have one now. Will that continue in future? And training for Bermudians . . . the objective of BELCO . . . I am pretty sure, there are a high number of Bermudians out there and we need to keep that ratio of Bermudians there. Yes, granted, we always need some outside expertise. I do not have a problem with that. But the majority of the people should be Bermudian, Mr. Speaker . So I think this is very good because BELCO is . . . the public, really, has financed BELCO in all the years that it has been there. And I say that because every time BELCO wanted to do a capital investment they came to the public. And most times they were granted a rate increase to pay for infrastructure. I do not have any shares in BELCO. Why should I be pa ying for the infrastructure and then I have still got to pay my bill? I do not . . . I do not benefit from that and, like most people in Bermuda, they do not benefit from that, but they have been the ones that have been pa ying for infrastructure at BELCO and I do not think that is right. Now, if the Government was to acquire 30 per cent in the future, if that is the number we set , or any Government sets, in BELCO . . . because I think Government —any government, regardless of who the government is —should have a say in the decisionmaking of BELCO. I would like to know is this new company . . . are they going to put cables underground, particularly along the shorelines where when we have a blow or hurricane, those are the lights that normally go out first? I think some of those cables need to go underground so that if we are out of electricity that it would not be a long ordeal as it was, I think, in 2002 or 2004 when we had a hurricane. I know I was out for about 12 days. So I think we can cut that number down, we probably can never stop it, because it is an expensive venture to put cable underground. But because it is
Bermuda House of Assembly expensive it does not mean we should not do it. I think we need to do it. So Mr. Speaker , again, I applaud the Minister for bringing this Bill because we need to have some control. Thank you.
The SpeakerThe SpeakerThank you, Member. Does any other Member wish to speak? No other . . . we recognise the Honourable Member from constituency 9. Honourable Member Moniz, you have the floor. Hon. Trevor G. Moniz: Thank you, Mr. Speaker . Well, that was an enlightening speech and certainly shows a slightly …
Thank you, Member. Does any other Member wish to speak? No other . . . we recognise the Honourable Member from constituency 9. Honourable Member Moniz, you have the floor. Hon. Trevor G. Moniz: Thank you, Mr. Speaker . Well, that was an enlightening speech and certainly shows a slightly different policy than th e one that the Minister has brought to the floor of the House. And I guess that is the concern that we have on this side, that there is not some political agenda with r espect to this change in legislation. It is always dangerous to have . . . you know, it is generally viewed as once a power has been given out to a quango to operate, you have given them i nstructions on how to do it, you have appointed the people that you want to run the thing, that you should have the faith and trust in them to do the job. And when we see this . . . and it is sort of eleventh hour, I mean, I think people have known for years that they were trying to sell BELCO, at the latest by the beginning of 2018. And it seems to be now they have found a purchaser they are in the process of selling. Now at the eleventh hour, the Government is trying to shut the gate to the barn before the horse escapes. So, you know, you wonder what . . . and fair enough, the Minister has gazetted directions, which is the appropriate way to go under the principal Act. But there is concern here for the consumers that this is going to be the best deal for the people of Bermuda as a whole. The Honourable Deputy Speaker was speaking to his own constituency —the unionised workers of BELCO. But there is a larger constituency which is what Bermudians are going to pay for their electricity. And I know these issues are very difficult ones with energy because there are whole, huge groups of people out there with very aspirational plans. I have seen all sorts of public meetings putting forward plans that we should have, you know, all solar energy and wind farms out on Challenger Bank and being very aspirational. But those . . . in my view, when people have asked me, I am saying well those are longer term plans that as t he technology matures, hopefully, Bermuda will be able to move in the direction of r enewable energy. But you are not going to be able to do that all in one step and at one go. It is going be a process over a period of time. And you know, Government’s responsibility is to run this in a smooth fashion so that BELCO is able to modernise. And the interests that the Government should be looking at always . . . and I have no reason to doubt the Deputy Premier in this. He is looking at the interests of the people of Bermuda. That is first and foremost [thought] in his mind over anything else. And as long as it proceeds in that fashion we on this side will support it. Thank you, Mr. Speaker .
The SpeakerThe SpeakerDoes any other Member . . . I reco gnise the Honourable Member from constituency 36. Honourable Member Scott. Hon. Michael J. Scott: Thank you, Mr. Speaker . Mr. Speaker , there seems to always in the Bermuda context to be this dichotomy. The role of a labour government —always …
Does any other Member . . . I reco gnise the Honourable Member from constituency 36. Honourable Member Scott.
Hon. Michael J. Scott: Thank you, Mr. Speaker . Mr. Speaker , there seems to always in the Bermuda context to be this dichotomy. The role of a labour government —always —is to ensure that it is protecting the i nterests of the workers of the country. In the Bermuda context where the Progressive Labour Party was both conceived as a defender of workers and labour, and it was not the Government or the party that had control or ownership of the business sector or the banking sector of capital, what else does the Opposition which classically are the party, and when they are the Government, they are the Government of the banking sector, the retail sector. When Ministers who own these entities sit in this House and gover n in the interests of those sectors, they distinguish them-selves always from a labour government. And it is just normal. I sometimes think that I am in a parallel un iverse when I hear the Honourable Member s invite a labour party government to not do things such as we are doing today giving Ministerial, Government oversight of a labour party government, oversight of a n ational asset —its sale, its role in employing people, protecting people, protecting people from prices. I know that in discussions in my cauc us we have had concerns that the share price that was at this premium share price compared with the price quoted on the stock of the BELCO share, and yet the sale being proposed for this yet unconsummated sale is going to be passed on. There should be . . . not only a Regul atory Authority will be alive to this risk, but certainly the Minister should be. And that is what a labour party government sets out to do. So we should make no apology, nor can we adopt as the former Shadow Attorney General seems to hav e a concern that there is some political agenda. It is not political. It is just simple good practice. It is labour politics that the Minister has an important say and an important control over this sale, the transfer of a national asset. And that is the way it is and we should . . . the cognitive dissonance that occurs in the House from that side of the House who generally support and are members of the business, and what we try to do, as the best we can as a party that has and that stands on principles of labour protection and labour rights wit h1898 21 June 2019 Official Han sard Report
Bermuda House of Assembly out having the power, yet, of being a party that owns capital in this country and can govern and drive policy into owned black capital, then this is what we are going to get. And we make no apology about it. I recall that the Opposition Leader Mr. Ca nnonier in the previous debate, advocated very labour like and labour right policies that the Government should just nationalise and buy BELCO . . . just buy it. So that was a rare departure by the Member of the OBA who generally supports business and would be supporting this idea that is being promulgated by the Honourable and Learned Member Mr. Moniz, or the concern being expressed by the Deputy Opposition Leader, that there is lack of independence implicit in the role of a Minister having a completely significant say in compliance by any transferee of a national asset having compliance with ministerial directed terms and conditions. And you know we really should be happy to see this. In all of the parts of the world where there are national assets of water or energy or telecomm unications, this applies. And yet we . . . this is why I say this alternate universe I sometimes feel that I am living in. We read about it and hear about it on CNN all the time. We know how the Am erican SEC regulates f inance and how the American systems and the Canada systems and the European systems behave when there are these kinds of exercises.
[Inaudible interjection]
Hon. Michael J. Scott: The regulators. Yes, that is — [Inaudible interjecti on]
Hon. Michael J. Scott: Yes, well, and we have not forgotten how to mimic it by having a regulator. After all, we put the RA in place. But we add belt and braces with ministerial oversight. We did it with the Authority for Tourism and many of the other s, for which we make no apology. We are . . . for which we make . . . and by the way, has anybody seen that the sky is fal ling as a consequence of these PLP policies?
[Inaudible interjection] Hon. Michael J. Scott: Yes? No.
[Inaudible interjections and laughter ]
Hon. Michael J. Scott: You make light of it. But, you know, the parallel universe again . . . The Honourable Member my colleague, Mr. Commissiong, has been driving liveable wage and just functioning in this country. French philosophers have been advocating and advising the world about the r emoval of capital by capitalists to themselves, just hauling it off, removing it and skimming it away from the 98 per cent, up to the 1 per cent it ends, and 98 per cent of us do not participate in capital —this incredible dis-equality debate that goes on day in and day out in our world. And I would hope that the Opposition is not over there advocating that we just continue to applaud these kinds of developments where we are trying to hold the tide back —
[Inaudible interjection] Hon. Michael J. Scott: —hold the tide back and ensure . . . frankly, we need to do more. We need to do more, but hold the tide back about these very grim, grim dis -equalities of wealth, of putting bread on the table and single mothers being able to cope with the cost of living in this country. And so when it comes to the payment of energy . . . and, by the way, it is no different from the payment of all of these other, you know, roaming charges in the telecommunications industry. When it comes to belt and braces and ministerial oversight, I applaud the Minister. I applaud the provision at clause 3 of the Bill (I hope I have chosen it right) where the Minister has this oversight, notwithstanding the governance of introducing, Mr. Speaker , the normal practical governance of assigning a regulatory role to a transaction such as this one, which is a transfer of an energy enterprise in this country. And let us not lose sight of the fact of the wi der context. The wider context is that we are v ery much engaged in Bermuda, as we are across the world, in better distribution of fairness in wealth, making life easier for the average man, making costs of coping and surviving, just removing that as a survival enterprise into one where there is just fairness. But if we just open our hands widely and not have a tight governmental presence and regulatory presence— and so by extension governmental presence and regulation and control —then we are just going on with the status quo. And so the provision very much rejects the continuation of the status quo as we seek, with all of the labour -like policies that the Government has been concerned with since 2017, to ensure . . . this is just typical and normalised labour policy in the context of the transfer of an important national asset. Thank you.
The SpeakerThe SpeakerThank you, Honourable Member . Any further speakers? I recognise the Opposition Whip. Honourable Member , you have the floor.
Ms. Susan E. JacksonGood afternoon, Mr. Speaker. So I would just like to have a few words around how we are actually going to make the trans ition. The Regulatory Authority was established in 2016, so they are still getting themselves up on their Bermuda House of Assembly feet. I understand that the …
Good afternoon, Mr. Speaker. So I would just like to have a few words around how we are actually going to make the trans ition. The Regulatory Authority was established in 2016, so they are still getting themselves up on their
Bermuda House of Assembly feet. I understand that the strength of the Regulatory Authority when it was establi shed was more around telecommunications. And so, you know, the electric ity— Hon. Walter H. Roban: Point of order, Mr. Speaker .
The SpeakerThe SpeakerI will take your point of order. POINT OF ORDER [Misleading] Hon. Walter H. Roban: The Honourable Member is, perhaps, not intentionally misleading the House. The Regulatory Authority has been in place since 2011. Its regulation of electricity began in 2016.
Ms. Susan E. JacksonThank you. Yes, accepted. So the Regulatory Authority has had, you know, only a few years to get themselves up to speed, as far as the electricity industry is concerned. And as I know they have brought in some consultants to assist them —and I am segueing to the Integrated …
Thank you. Yes, accepted. So the Regulatory Authority has had, you know, only a few years to get themselves up to speed, as far as the electricity industry is concerned. And as I know they have brought in some consultants to assist them —and I am segueing to the Integrated Resource Plans —I am aware that BELCO and BE Solar have both submitted IRPs. So there is probably a learning curve for the Regulatory Authority as they read through and process some of the ideas from these two particular reports that have been produced. But they are, as I understand it (“they” being the Regulatory Authority), now going to have to create their own Integrated Resource Plan which will lay out what Bermuda would like to see in the future. And clearly, based on consultation . . . and certainly the conversation on the street is that renewa ble energy is definitely the long- term goal and the general direction in which we would like our energy to go in the future. But putting that vision aside for a moment, the reality is that we have got an ageing power station that has just brought in a num ber of engines to the Island that are diesel and/or can be used for LNG. So no matter what we do, we are stuck with a transition from a very traditional model to a very futuristic model around renewable energy. So now whether it is the Regulatory Authority that is going to have to decipher through this, or whether it is the Minister who is basically going to have to take the lead on this, we are going to have to find a company who may be willing to come in and purchase BELCO and be able to make that transit ion. And it is not going to be an easy one. And I do not honestly know whether we have got the expertise on Island to help us to make that transition on our own. So we are going to probably have to depend on the purchaser of BELCO to help us to make that transition. So I guess my concern is that we may come up with an Integrated Resource Plan that may not be best suited for, you know, the sort of reality of the Bermuda infrastructure. And with that, I have read a comment that said, Yes , we may have to writ e a few Integrated Resource Plans before we get to exactly where it is we are going , and that is understood. But I guess I just do not want Bermuda to get stuck in a situation where we are dismissing the potential purchasers of BELCO because we do not see a clear line of sight to our long- term vision, not realising that there may be steps in between there where we are going to have to compromise on the generation of our electric ity until we can get to the renewable energy. So that would be something concer ning, and I hope that the Government keeps us informed, and the Regulatory Authority keeps us informed of those kinds of transitions. The other side of it is the labour, the staffing. Certainly, the Member who spoke before me was passionate about the labo ur force, in particular, at our electric utility. And my other piece of the long- term vision is, How are we going to transition those eng ineers who are maintaining and taking control of our diesel engines, who may be quite well -versed in the new engines th at have arrived in Bermuda, but may not have the training and the exposure to some of the renewable energies? And what is the Government going to do to protect that, if that is what they want to do? If they want to take the existing BELCO model and change it into renewable energies. And how are they really going to set out a plan to protect the wor kforce who are knowledgeable in the traditional energy generation that we have presently at BELCO into expert and skilled practitioners in renewable energies? So that is going to be something of a cha llenge for the Minister to be able to carry out in tandem with the implementation or the acceptance of an external company to purchase BELCO and develop, hopefully, and conform to renewable energies at some point, but that also the labour force is going to be supported in also making that transition. So there is a huge challenge ahead. I believe that all hands need to be on deck for this because it is our life source. I mean, everything. If I say it to the . . . you k now, we cannot have Internet without the electricity, so this is really, really our lifeblood on the I sland. And so we have to tread carefully and make sure that whatever is decided, whatever the Minister approves, whatever company the Minister approves to be brought into Bermuda, that we will maintain reliabi lity and that we will make a smooth transition from a very traditional model to renewable energies. Thank you.
The SpeakerThe SpeakerThank you, Members. Does any other Member wish to speak? We recognise the Honourable Member from constituency 21. Honourable Member Commissiong, you have the floor.
Mr. Rolfe CommissiongThank you, Mr. Speaker. 1900 21 June 2019 Official Han sard Report Bermuda House of Assembly Mr. Speaker, I am of the view that everything has to be on the table right now. I mean, we just had a previous disc ussion, without debate, and I do not want to …
Thank you, Mr. Speaker. 1900 21 June 2019 Official Han sard Report
Bermuda House of Assembly Mr. Speaker, I am of the view that everything has to be on the table right now. I mean, we just had a previous disc ussion, without debate, and I do not want to get into any reflection here. But across so many areas of Bermuda’s life, Bermudian life, and our economy, we are at an inflection point. And no less in the area of energy generation. So, you know, we are currently . . . we have been served by a post -World War II model with r espect to that and BELCO, and it is certainly . . . it is not sustainable. I mean, I heard my honoured and learned colleague from [constituency] 36. He made reference to the living wage. But the reality is, and I am going to be quite honest to not only the colleagues here but to the persons listening, we are not going to be as successful as we need to be with respect to the implementation of the living wage unless there are other public polic y reforms that are going to be impl emented in tandem with that. And we had the discussion around this when we had our committee. The Deputy Leader of the O pposition, she is fully aware of wherever I am going. So along with that we need a reduction in the cost of health care. We need a reduction in the cost of energy, which also has to be an integral piece of any potential reform and prospective sale of BELCO. It has to deliver —has to deliver —that benefit primarily to the Bermudian people and consumers, but also to Bermudian businesses, because the cost of energy is one of the most major headwinds hurting our competitiv eness .
An Hon. Member An Hon. MemberHear, hear!
Mr. Rolfe CommissiongAnd finally, getting back to the living wage piece, we need tax reform in this cou ntry. It has to be part of the whole suite of public policy reforms that we must address now. Now more specifically in terms of BELCO, I heard my colleague, the Member from constituency …
And finally, getting back to the living wage piece, we need tax reform in this cou ntry. It has to be part of the whole suite of public policy reforms that we must address now. Now more specifically in terms of BELCO, I heard my colleague, the Member from constituency 5, the Deputy Speaker. He brought up the issue of nationalisation and of course I know that within the PLP, particularly going back into the late 1960s and early 1970s, along with mainstream parties in the deve loped world, that was not a taboo subject. I am not at a point now where I am advocating that the Government should own all of BELCO, but let us put this in perspective. In many developed countries you have state ownership of significant private sector holdings. So, if I may, Mr. Speaker, for example in Germany, the German government owns Deutsche Bahn which is the largest private rail network in E urope. They also have Hapag- Lloyd which is a name familiar with us, a major shipping (is it shipping containers?) and shipping- related matters. They own 23.2 per cent of that. The German government owns 12 per cent of Airbus, 15.6 per cent of Commerzbank, 12.7 per cent of Volkswagen Group, 14.5 per cent of Deutsche Telekom, and T -Mobile, they had 17.4 per cent of that.
[Inaudible interjections]
Mr. Rolfe CommissiongThat is in Germany. In France, there are also signific ant holdings of private companies. They are managed under a particular group on behalf of the French government. The organisation is called Agence des participations de l’État and they control the ownership of the French stake holding in a number …
That is in Germany. In France, there are also signific ant holdings of private companies. They are managed under a particular group on behalf of the French government. The organisation is called Agence des participations de l’État and they control the ownership of the French stake holding in a number of privat e companies i ncluding the airports of Paris, Air France- KLM, Dexia, EDF, Angele, Orange, Orano, Renault (which has been in the news of late), and it goes on and on and on. So we should not view this as being something taboo that is not within the mainstrea m of western p olitical economy and it is not new whatsoever. Now, is it too late for us to contemplate ha ving, not 100 per cent ownership of BELCO, talking about Government, but even a 10 [per cent] or 15 per cent stake? I also may add in both the German and French models they also, in addition to having owner-ship stakes of these companies, minority ownership stakes, they usually have board participation as well; maybe one, maybe two persons on the various corporate boards. That is something we need to think of. Like I said, nothing should be off the table here be-cause we are at that point now in Bermuda’s development. With respect to sustainable development, more so reducing our carbon footprint, I had a conversation only recently with the Minister of Tr ansport and we talked about moving the needle when it came to electric buses, for example. And I would go further and say not only electrification of our bus fleet in terms of power generation, but of course the public fleet in general, the government vehi cles, for example. We need to start setting hard targets and moving t oward that. One of the ways that it is going to be doa-ble and sustainable is getting back to the issue of r educing the cost of electricity in Bermuda. So I think that this is coming at t he opportune time to lay down a marker. I think it is important that we have our Government having a critical role to play even at this late hour with respect to the pending sale of BELCO to ensure that Bermuda’s interest is going to be looked after and to ensure that those things that we are going to need the new owners to agree to are going to be on the table and are going to be those that are going to be in the best interest of Bermuda, not just in terms of the workers of BELCO, but Bermuda more broadly at this juncture of our development. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Member. Does any other Member . . . Bermuda House of Assembly We recognise the Honourable Member from constituency 22. Honourable Member Pearman, you have the floor.
Mr. Scott PearmanThank y ou, Mr. Speaker. We have had a little wander today. We are supposed to be talking about the Electricity Amend-ment Act. We have heard about tax reform and living wage. And I suppose if they are allowed to take these slight detours, you might permit me a quick …
Mr. Scott PearmanMy learned and honourable friend from constituency 36 referred to what is being done as, holding the tide back . Now that is a reference to King Cnut: King Cnut who was a Scandinavian king, who ruled most of Scandinavia and Britain. And in around 1027, King Cnut went down …
My learned and honourable friend from constituency 36 referred to what is being done as, holding the tide back . Now that is a reference to King Cnut: King Cnut who was a Scandinavian king, who ruled most of Scandinavia and Britain. And in around 1027, King Cnut went down to the coronation of the Holy Roman Empire. And at the end of his life he sat in his throne on the sand by the shore as the tide was calling in and he held his hand out to stop the tide and the tide did not stop. Now that story is often told as an example of arrogance, because King Cnut was a powerful man. And people often misinterpret and mis s-tell the story as being about someone who believed he could stop the tide. And that is not in fact what the story was about and that is not why he did what he did. Yes, he was wielding power, but by sitting in his throne by the tide on the sand, and by failing to stop the tide, he was to let all men know how empty and worthless is the pow er of kings. And why do I say this? Because this Bill, forgive the pun, is about power as well, both kinds, BELCO, but also ministerial power. And it is interes ting again to pick up on from my friend from constit uency 36, because when backed into a corner he star ted to speak about how normal this was. Of course it is normal. Look at the United States. Look at the FCC, he said. Yes, look at the United States, look at the FCC. Look at the regulator in the United States; b ecause these are independent bodies t hat are sensibly created. Indeed, as the Deputy Premier said earlier, I believe the Regulatory Authority was created in 2011. They are created to remain independent of gover nment to ensure and to protect against the misuse of government power. And this is the problem we face. We have seen a casino commission, a gaming commission that was set up to be independent of Government, and yet the Government wades in. Now we have no casinos; no bank in the US that is willing to transact because of the Minister’s in volvement. We have seen an independent Bermuda Tourism Authority, and yet again the Minister wades in. Hon. Walter H. Roban: Point of order, Mr. Speaker.
The SpeakerThe SpeakerPoint of order. POINT OF ORDER Hon. Walter H. Roban: I am hesitant to take this point of order because the Honourable and Learned Member is actually talking about a point that is irrelevant to this Bill. But that is not why I raised my point of order. It is …
Point of order.
POINT OF ORDER
Hon. Walter H. Roban: I am hesitant to take this point of order because the Honourable and Learned Member is actually talking about a point that is irrelevant to this Bill. But that is not why I raised my point of order. It is that the assertion that due to Ministerial influence is why we do not have corresponding banks here in our gaming or our proposed gaming industry is false. And I think that it has been very clear by the path that we have taken with gaming in that this has to do with issues of the banking relations in, like, Berm uda and the hesitancy of the corresponding banks that we deal with in North America and elsewhere to a pprove such relationships, not to do with any gover nmental influence. But that is really an irrelevant point to the Act we are dealing with, but I felt it important to raise because it was an accusation that was false made by the Honourable and Learned Member.
Mr. Scott PearmanMr. Speaker, as to the point of order, the reason that we do not have correspondent banks prepared to bank the assets of gaming from Bermuda, were there to be any, is because of the le gislative change by this Government to put in Minister ial interference. I stand by …
Mr. Speaker, as to the point of order, the reason that we do not have correspondent banks prepared to bank the assets of gaming from Bermuda, were there to be any, is because of the le gislative change by this Government to put in Minister ial interference. I stand by that statement. I have repeated it. I have been careful in what I have said. If the Deputy Premier does not appreciate that, then I would s uggest he speaks to correspondent banks about their concerns about potential for corruption in the gaming industry, and he might learn a thing or two. The Bill seeks to assert the clunking fist of Government over an independent regulator. The par-allel wit h the casino and the gaming industry in Bermuda and the independent commission is appropriate and apt, and I stand by it. The parallel with the Bermuda Tourism Authority and ministerial interference is appropriate and apt, and I stand by it. Unfortunately, and I will go to the Bill, we now learn that if under clause 2 [new section 4](5) the Authority, the Independent Regulatory Authority, intends to give consent to something, quote, if I may, Mr. Speaker? “it shall first consult the Minister and obtain his approval.” If that is not a King Cnut assertion of power, I do not know what is. It would be far better if we let independent i nstitutions remain independent and do the role that they are supposed to do without Government sticking its nose in. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. 1902 21 June 2019 Official Han sard Report Bermuda House of Assembly Does any other Member wish to speak? We recognise Honourable Member Swan from constituency — [Inaudible interjection]
The SpeakerThe SpeakerMembers! We recognise the Honourable Member Swan from constituency 2.
Mr. Hubert (Kim) E. SwanYes, Mr. Speaker. The Electricity Amendment Act is all but one page, but speaks to some very significant matters pertaining to legacy in Bermuda. I have listened, and the Member that just spoke mentioned, “ministerial po wer,” “misuse of Government power,” and said it very forcefully. And it is a …
Yes, Mr. Speaker. The Electricity Amendment Act is all but one page, but speaks to some very significant matters pertaining to legacy in Bermuda. I have listened, and the Member that just spoke mentioned, “ministerial po wer,” “misuse of Government power,” and said it very forcefully. And it is a repetition of what I spoke of to earlier today about a narrative. Those were his words. But let us talk about ministerial, governmental misuse of power. If you went to BELCO toda y and googled “BELCO history,” it will come up as thus: “Not available,” “Page not found.” Why would that be so? Who would have owned BELCO in 1904? Who would have been the shareholders of BELCO in 1969? In 1950? Their names might be associated with persons who sit in this very House, who sat in that very seat that the Speaker sits in, who sit in the very seat across where the Honourable Deputy Leader sits in, that might even have the same name as the Honourable Member that just spoke. I am just saying. When you talk about misuse of power, the way in which misuse of power that allowed the BELCOs, the legacy establishments of this country to exist, that is the travesty. And let me talk about for ever so briefly about veto power, okay? We have experienced ve to power that . . . I support independence for Bermuda, okay? I supported and stood at the polls in 1995 in support of it, and I will do it again. But we see veto power as it is exercised in Bermuda. We had the Progressive Labour Party have a Bill pass wi th the cooperation of the then Government Member be vetoed in this very country. And the very Governor of this country has veto power every day in this country. But that is okay. But when a Government elected by 59 per cent of the people of this country comes forward with legislation, the Opposition, in conjunction with the Governor, has veto power that no one wants to talk about in that appointed Members can veto. And that is real. And it is tied to a constitutional construct which speaks to our historical construct. And that is the reality of Bermuda.
An Hon. Member An Hon. MemberHear, hear!
Mr. Hubert (Kim) E. SwanI mean, you had the very Opposition Leader, not too long ago, in this very House make statements. And I read from the Hansard. These are the words of Mr . Cannonier, you know it says, “ 3Mr. Speaker, BELCO is being sold outright. Outright! The public . . . …
I mean, you had the very Opposition Leader, not too long ago, in this very House make statements. And I read from the Hansard. These are the words of Mr . Cannonier, you know it says, “ 3Mr. Speaker, BELCO is being sold outright. Outright! The public . . . we are hearing from the public the same thing. I mean, certainly, one of the opportunities is that this Government could nationalise BELCO.” Those are t he words from the very Opposition Leader of the Government today. And what we need to hear is what his position is on it. I am quite happy for him to do so. But let us not, you know . . . when it comes to the Progressive Labour Party wanting to put forwar d legislation, you know, the code words and the code languages are constantly coming forward, [like] mis-Ministerial power and misuse of Government power , when the very Government of the day can be vetoed on any legisl ation by the Foreign and Commonwealth Office through the Governor. But that is okay for persons who are quite comfortable with the legacy arrangement that has been handed down to them by their forefathers. I do not accept that. It is wrong. And any right -thinking person would know that it is wrong because the pla ying field is tilted in one direction to favour those who inherited the legacy. It is tilted in that way. And it is as clear as clear can be. And you know what, Mr. Speaker? When you look at the way in which BELCO went down, it was not that clean cut . . . it was not. And questions certainly need to be asked. And let us look at other jurisdictions throug hout the world. People like to talk about the FCC and other places like that, you know. Persons in high authority in other jurisdictions also have veto power. But it is okay; it is them. And I would say that as we start looking at these legacy establishments that run rampant in Bermuda, as we look at the unlevel playing field that the Progressive Labour Party Government is prepared to address, let us not forget that there are persons who benefit from this system, who would fight tooth and nail to keep it in play, because truth be known, with that type of money and power that comes with it, they do not need a government to be able to do whatever they want in an environment. That is the truth. And so when the Government . . . and let me say this, because I am getting sick and tired of these code words, you know, misuse of Government power , and so forth. Do you know, Mr. Speaker, since 1998 some of the most progressive, fair -minded legislation has come from the Progressive Labour Party? I mean, you know, we talk about ministerial misuse of power. You know, when we saw we had an airport where we had an organisation, we had a group of concerned people in Bermuda that got a PATI request that r evealed some of the skulduggery going on behind the scenes. But that is okay. And that is the type of thing that is okay for them to do and support.
3 Official Hansard Report , 7 June 2019, page 1837
Bermuda House of Assembly And you know what? When I googled BELCO history . . . I w ould invite every young scholar out there to research that history. There is an old saying, in audit . . . you know, follow the money. Follow the money from 1904. Follow it to today, and you will see where that trail leads and you will know where the howls come, when it comes to what it is going to do for . . . and when a Government is looking at ways to make the playing field level. You will hear the howls. And you know what? Mr. Speaker, the less i nformed and respectfully ignorant may not even see it happening under their very eyes, and they might see the opposite. Well, I am here to tell them, Mr. Speaker, that there is a lot more than just this Electricity Amendment Act that needs to be looked at when you talk about this scenario. As I have often said, business people, if they could find a way to charge me for the air, they would do it. And they would find a way to get somebody to regulate it too. We cannot move in this world without energy. But yet we are seeing things that happen with us in major, maj or areas being farmed out. And if a Government sees that this is not in the best interest of the collective all, rather than the shareholder few, where can it express its concern? Where can it, you tell me, and how should it? But it is okay for the Governor to set up on that Hill every three years being recycled over to come here and have veto power over us, but we are not good enough to have that type of oversight over ourselves. Something is wrong with that picture, too, very wrong. I am here to tell you that it is very wrong. And the reason why you would hear the howls because if you were to examine that history and that financial connection to those legacy institutions, you will see where it is coming from —through persons not interested in this country being level because it does not benefit them. And that is the unfortunate tragedy, because it is so much good for us all as people if they would embrace that. And I am here to say that this Government is introducing this mechanism with good intentions and I would argue that for anybody to say, you know, that this Bill is associated with misuse of Government power is imputing improper motives on my Deputy Leader. And I do not accept that. I do not at all, Mr. Speaker. And Mr. Speaker, I am sure that you are probably far better than me. This whole scenario as it relates to this energy thing . . . I am just a country boy, so I will just quote a little quote from Glory , a movie that I have seen over and over again, Denzel Was hington. Colonel, it stinks. It stinks real bad.
The SpeakerThe SpeakerThank you, Honourable Member. We now recognise the Leader to the Oppos ition, Honourable Member. Hon. L. Craig Cannonier: Thank you, Mr. Speaker. I take to heart the comments by the previous Member, from constituency 2, towar ds BELCO. I think as I look back on some of the discussions …
Thank you, Honourable Member. We now recognise the Leader to the Oppos ition, Honourable Member. Hon. L. Craig Cannonier: Thank you, Mr. Speaker. I take to heart the comments by the previous Member, from constituency 2, towar ds BELCO. I think as I look back on some of the discussions that we have had concerning BELCO, I am sure that we are all aware of the history of BELCO. We continue to hear it repeated over and over. But here and right now, Mr. Speaker, I think we need to be very clear about who works over there right now. If there was a poster child company when it comes to hiring Berm udians and promoting Bermudians, it would be BELCO. I must declare my interest.
Hon. L. Craig Cannonier: My eldest daughter who grew up, a nd we are talking about coming from labour roots, is now an attorney with BELCO, and so—
The SpeakerThe SpeakerPoint of order. I will take your point of order. POINT OF ORDER [Misleading]
Mr. Hubert (Kim) E . SwanI know that the Opposition Leader is not intentionally misleading the House, but I felt that I had to because I think he is inadvertently misleading the House. In recent months, the amount of BELCO employees that have stopped me because of displac ement is a major concern. I just …
I know that the Opposition Leader is not intentionally misleading the House, but I felt that I had to because I think he is inadvertently misleading the House. In recent months, the amount of BELCO employees that have stopped me because of displac ement is a major concern. I just had to put that out there because the Opposition Leader was making a reference that would have negated that very reality.
The SpeakerThe SpeakerOkay. All right. Member, you had a little latitude there. But . . . Opposition Leader, continue. Hon. L. Craig Cannonier: Thank you. Thank you, Mr. Speaker. I appreciate that, Mr. Speaker. So, I will go back to my point and that is BELCO has come a long way. Is …
Okay. All right. Member, you had a little latitude there. But . . . Opposition Leader, continue.
Hon. L. Craig Cannonier: Thank you. Thank you, Mr. Speaker. I appreciate that, Mr. Speaker. So, I will go back to my point and that is BELCO has come a long way. Is it where we want it to be? Certainly not. That is why we are here today con-tinuing to discuss how we improve things as far as this utility is concerned in Bermuda. But there is no doubt whatsoever that those who are at BELCO and conti nue to be employed at BELCO have realised the ben efits of many, from labour and business, who stood b y the fact that we needed equality, that we needed fair benefits concerning Bermudians who were working there. And so, as we fast forward to today, yes, I am sure that there are concerns still there. But when I look at BELCO, it is one of the few companies that we can truly say looks out for Bermudians. When I look at the shareholdings of BELCO, I also understand that Bermudians own 70 per cent of those shares. The breakdown of that, I do not know. 1904 21 June 2019 Official Han sard Report
Bermuda House of Assembly And you know, I am hearing that the breakdown though, that 70 per cent, has been there for a while. I checked the history of it. And so, they are not cashing out right now. With the potential buy of this BELCO, they should be buying shares right now, so I do not know what you are talking about.
[Laughter]
Hon. L. Craig Cannonier: So, Mr. Speaker, you know, I have listened very carefully. And I wanted to be fair with my comments concerning this here. The real concern really is, if we are putting in regulatory authorities, if we are putting in bodies, and if you think about this particular regulatory body that [we have] right now for energy, we have a former person from BELCO who is now the Chair of this body. And so, this person was appointed by the Government. So, some of the . . . I guess, a fair question is ok ay, well, if you appointed the Chair, if you appoint —
[Inaudible interjection] Hon. L. Craig Cannonier: He was a former . . . I am talking about he is the Chair —
Hon. Walter H. Roban: Point of order, Mr. Speaker.
[Crosstalk ] Hon. L. Craig Cannonier: Oh, okay. [Crosstalk ]
The SpeakerThe SpeakerMinister. POINT OF ORDER [Misleading] Hon. Walter H. Roban: I think again, I do not believe the Opposition is purposely misleading the House or the public, but I think it is important to understand that the Government does not appoint the CEO of the Regulatory Authority. Hon. L. Craig Cannonier: …
The SpeakerThe SpeakerIs your microphone on? Hon. Walter H. Roban: The CEO is employed by the commission. Hon. L. Craig Cannonier: Yes, yes. Hon. Walter H. Roba n: The commission is appointed by a panel. This is all in the legislation, so any Member of the Legislature can look at it. A …
Is your microphone on?
Hon. Walter H. Roban: The CEO is employed by the commission. Hon. L. Craig Cannonier: Yes, yes.
Hon. Walter H. Roba n: The commission is appointed by a panel. This is all in the legislation, so any Member of the Legislature can look at it. A panel which includes the Minister responsible, the Attorney General, and the Leader of the Opposition, and in the last appointment the former Leader of the Opposition was a part of that panel.
Hon. L. Craig Cannonier: Yes.
Hon. Walter H. Roban: So, the Government does not impose any leadership on the Regulatory Authority, because that is essentially what the Opposition Lea der said. But I do not believe he was intentional in sa ying that.
Hon. L. Craig Cannonier: Fair comment. Yes, Mr. Speaker, fair comment.
The SpeakerThe SpeakerContinue on. Hon. L. Craig Cannonier: I do accept that. The point that I am getting to is [that] the normal conc ern would be, okay then, if we have a regul atory body that is in place, that we are trusting in, it is a body that, again, is …
Continue on. Hon. L. Craig Cannonier: I do accept that. The point that I am getting to is [that] the normal conc ern would be, okay then, if we have a regul atory body that is in place, that we are trusting in, it is a body that, again, is well vetted to ensure that we get good people within that particular area of expertise, then the question is, Why do we then need ministerial oversight over this? Do we not have faith in our judicial system, because the recourse before this Bill is passed is if the Government finds that they are not in agreement with it, then they can take it to court and then a fair trial would be had concerning the issues. We are now averting that process, which is why we have a judicial body put in place. And now what we are saying is that if the Minister feels that, you know, he does not like the way that it is going, then he or she can intervene. Now, I understand that, but my concern would be that with the changing of Governments back and forth, where is the consistency then going to be in this? The whole purpose of the regulatory body is to create consistency there. So, I get the concerns, why many of my Members on this side are asking the questions. And then there was this reference to me getting up and saying that, Well, go ahead and nationalise it. And listen, if we cannot then as legislators up here, the PLP as Government and the OBA as an Opposition [can] encourage our people, it is a publicly traded company to buy shares in this, I mean, I am sure you have watched enough television shows. If you do not like who owns the majority of shares, then get a bunch of people together and buy them o ut! Go get a bunch of people together and buy the remainder of shares in BELCO and benefit from it. So, when I hear that, you know, well, Go vernment might have 30 per cent share of it or this kind of a thing, well, listen, nationalise it! Yes! I have got t o think it through a little more, but nationalise it! That way, guess what? Everybody in Bermuda owns it. Blacks own it, whites own it, everybody owns a stake in this utility.
Bermuda House of Assembly And I will give it some more thought, and maybe I will flesh it out in a motion to adjourn at some point in time. But, certainly , that is an option that is on the table! It certainly is! And that is why before when I said, Well, hold on a second, I kind of felt like, Well, hold on a second. We are going to sell out to a Canadian, a f oreign private company who invariably is socalled ‘white,’ but then we are going to complain about the white Bermudians in Bermuda. And I am saying to myself logically, Well, what, we prefer a white Canadian over a white Bermudian? So, let’s sit down and discuss this thing! That is what people are saying on the street. And I am walking every day in town, around town, and I am listening to these comments coming back, which is why I am saying what I am saying. So bad! We do not want a private company, we ar e going to have difficulty trying to control it . . . nationalise it then! Let’s see if we can manage a utility like this here. It is not beyond us. I believe that we have al-ready shown that we have got Bermudians who can lead. We have seen many Bermudians leading out at BELCO. So, this is an option that is on the table. But what is concerning is that we kind of have this whet her it is the OBA . . . sorry, or I should say the Gover nment and whether it is the Government of today or whether it is the OBA as t he Government, the public is basically saying, Well, hold on a second. I am not sure I want a Minister having full control like this here. And that just goes toward people’s opinions of politicians, period! That is just the way that it is. And that is why I was making the suggestion, Oh, okay, fine, we can remove this whole issue, we are going back into the history and this and that, let everybody own it. Sure, I am putting it on the table. That is a serious option that is available to us. But we cannot be casting one sector of Bermuda saying, Well, we don’t want them involved. Li sten, man! I am encouraging you, Bermuda. Buy some shares in BELCO. You saw what the price is going to be if these people buy it. Buy some shares, Bermuda! I mean, my granny, good old Labour Granny Ethel, I mean, my goodness, she had shares in Stevedoring Services! When she passed away, that is when we found out about it. She was exercising her right. I wish she would have told the rest of us about it. But my point is that we have a n opportunity and rather than going down the road and just trying to paint, you know, almost in a blanket statement white people as being the bad and benefiting from the old, well, here and now, right now, let’s get some black people involved. You know? An d it is almost as if we do not have black business owners today. This House of Assembly is full of them. And so, when we start talking about business, we just automatically refer to business as being white. Well, we have come a long way! Blacks own busines ses and are trying to thrive just like everyone else. And so, I am hoping that as we move forward, certainly, we understand and we recognise where this Bill sits. It will be encouraging that we, as an Oppos ition, and this Government will continue to exerci se the right to speak to our Bermudians about their options that are available out there, but there are options. And so, my concern—I go back to my concern—is that, you know, with Governments potentially changing back and forth we could see some irregular ities. We basically want to see consistency in this area. And so, I am hoping that if this Bill and understanding that this Bill will go through that we are going to see the consistency that is necessary and needed for Bermudians to thrive. And I recognise that we are going to be looking at this potential sale with this company that they will be looking out for Bermudians, but I also recognise that BELCO as of today got some great Bermudians over there. Great, great Bermudians. And so, I applaud this Government for saying that they are going to be looking out for Bermudians, but by no means make the mistake to think that the OBA is not concerned about every single one of those members who work for BELCO who bring us power on a daily basis. And when hurricanes hit, they are probably one of the best or the best in the world at restoring us back to normalcy, which has been the case. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Member. Minister? Premier. Hon. E. David Burt: Mr. Speaker, my contribution on this Bill will be brief. And the reason why I think that it is important to speak on this is because it is a national issue. I am grateful for the Honourable Member for constituency 2 …
Thank you, Member. Minister? Premier.
Hon. E. David Burt: Mr. Speaker, my contribution on this Bill will be brief. And the reason why I think that it is important to speak on this is because it is a national issue. I am grateful for the Honourable Member for constituency 2 who reminded the Opposition Leader of his comments a while ago, because . . . or two weeks ago, because I would have thought on such a seminal issue of a power company that the only time we would have heard of such a bold declaration and statement from the Leader of the Opposition or Lea der of the One Bermuda Alliance, the only time that we would hear it would not be just during motion to ad-journ, but it would have been something that would have been pronounced. And instead of fleshing out a plan and saying he might give it some thought in a future motion to adjourn, that when he was speaking on a particular issue he might have actually been thinking about what he was saying before it was act ually said. But it is interesting, Mr. Speaker, because at the same point in time that the Opposition says that they do not want ministerial interference, yet they want the Government to buy the power company. It is a very 1906 21 June 2019 Official Han sard Report
Bermuda House of Assembly interesting dichotomy there. So, he says to nationalise the power company, and nationalising a power company is what governments do, they buy things —
Hon. L. Craig Cannonier : Point of order, Mr. Speaker.
The SpeakerThe SpeakerWe will take your point of order. POINT OF ORDER [Misleading] Hon. L. Craig Cannonier: The Premier is inadvertently misleading the public and this House. I did say that it was an option. I was not sa ying that this is what I am solely promoting, but that it was …
The SpeakerThe SpeakerContinue. Hon. E. David Burt: Mr. Speaker, leadership requires you to make a decision. It does not allow you to just go ahead and . . . well, if tha t is what you want to do in the Opposition, then go ahead, if you want to give the people …
Continue. Hon. E. David Burt: Mr. Speaker, leadership requires you to make a decision. It does not allow you to just go ahead and . . . well, if tha t is what you want to do in the Opposition, then go ahead, if you want to give the people of this country non- clarity insofar as the direction in which you are going. Because you cannot say that you are going to take private property by national-ising and t hen without actually saying that this is the policy —
Hon. L. Craig Cannonier: Point of order, Mr. Speaker.
The SpeakerThe SpeakerWill take your point of order. POINT OF ORDER [Misleading] Hon. L. Craig Cannonier: The Premier is inadvertently misleading the publ ic once again. [Inaudible interjections]
The SpeakerThe SpeakerJust speak to the Chair. Hon. L. Craig Cannonier: I did give an explanation as to why I thought it was potentially a good reason.
The SpeakerThe SpeakerPremier? Hon. E. David Burt: Thank you, Mr. Speaker. I will go back to the comments, because when we talk about the options, we have to make sure that we are very clear. And I think I made this clear before and this is the reason why I am happy …
Premier?
Hon. E. David Burt: Thank you, Mr. Speaker. I will go back to the comments, because when we talk about the options, we have to make sure that we are very clear. And I think I made this clear before and this is the reason why I am happy that the Ho nourable Member took to his feet to try to explain his particular position. And the only thing that I am saying, Mr. Speaker, is that if the option which he suggests is the option which should go forward, then the question is how exactly does that happen? And the only way that actually happens is an amendment to the Electricity Act, which is what we are doing today. Now, just to be clear, Mr. Speaker, I am not saying that it is the policy of this Government to take private property.
An Hon. Member An Hon. MemberOoh! Ooh! Hon. E. David Burt: I am not. No, I am not. That is your place, because I am not. [Inaudible interjections] Hon. E. David Burt: No, no. I am not saying that it is the policy of this Government to take private property. But what I think, Mr. …
Ooh! Ooh!
Hon. E. David Burt: I am not. No, I am not. That is your place, because I am not. [Inaudible interjections]
Hon. E. David Burt: No, no. I am not saying that it is the policy of this Government to take private property. But what I think, Mr. Speaker, which is interesting, is the fact that we see once a gain the Oppos ition at war with itself. We have seen it time, and time, and time again today, Mr. Speaker. And the only thing I want to say, Mr. Speaker, is that the people of this country deserve clarity when it comes to the major issues of the day. The Government has been clear on this particular issue. The Government has been clear on where it stands. The Government has been clear ins ofar as the brief that was given by the Deputy Premier, the approach that is going to be taken in the review of any sale, and to make sure that the ultimate political responsibility lies with a Minister who has accountabi lity to this House who was elected. That, Mr. Speaker, is what responsible Governments do. Think through the policy, make sure that you understand what it is and the approach which you are taking and acting responsibly. And the one thing I would say with the Opposition Leader is that probably the best place to come up with national policy is not during motion to adjourn, Mr. Speaker. Thank you.
The SpeakerThe SpeakerDoes any other Member wish to speak? Minister ? Hon. Walter H. Roban: Thank you, Mr. Speaker. I must say, I did not realise this debate would cultivate such strong, I guess, submissions from a variety of, and perhaps I am just being slightly fac etious, b ecause perhaps I …
Does any other Member wish to speak? Minister ?
Hon. Walter H. Roban: Thank you, Mr. Speaker. I must say, I did not realise this debate would cultivate such strong, I guess, submissions from a variety of, and perhaps I am just being slightly fac etious, b ecause perhaps I knew it would. Because clearly the sale or the anticipated sale, I should say, because there is no confirmation of sale of the company. There has been an announcement of an intended sale which has to go through a number of proces ses before it actually is approved, which is why we are here today, to frame that process in a way that will be in the best public interest. And so, a number of interesting submissions were made today by a number of Members. And cerBermuda House of Assembly tainly it seemed to be that the ch ief submission by the Opposition by its spokesperson was a concern about the fact that the legislation being proposed today takes away some of the independence, if I can frame the work of the regulator. And as I think is understood that the Regulatory Authority is a body that regulates electricity and telecommunications in the country. And it is their responsibility and they operate as an independent body in the oversight of those respective i ndustries. And there is specific legislation obviously around tha t. There is the general legislation of the Regulatory Authority, and then there is the sectoral legislation. Now, the sectoral legislation of discussion t oday is the Electricity Act 2016. But there is also the Electronic Communications Act, which is the sectoral legislation that oversees the telecommunications i ndustry. And what is very interesting, and this is dealing with one of the questions raised by the Opposition, it appears as if the Government is going far and inser ting itself into the decision making of the Regulatory Authority in a way that is not appropriate. Well, we are here amending a particular section of the Electricity Act 2016, but I would implore Members to go and look at the Electronic Communications Act 2011, which was passed at the sam e time as the Regulatory [Authority] Act of 2011, and there is a section 18 [in the Electronic Communications Act 2011] which has to do with integrated communications operating licences. And in that section, if you will allow me to read, Mr. Speaker —
The SpeakerThe SpeakerContinue. Hon. Walter H. Roban: [Section] 18(6) of that piece of legislation says this: “An ICOL shall not be trans-ferred or assigned, and may be terminated by the A uthority in the event of any such transfer or assignment or if there is a change of control over the licensed …
Continue. Hon. Walter H. Roban: [Section] 18(6) of that piece of legislation says this: “An ICOL shall not be trans-ferred or assigned, and may be terminated by the A uthority in the event of any such transfer or assignment or if there is a change of control over the licensed ent ity unless the transfer, assignment or change of control is authorised in advance, in writing, by the Authority acting with the written consent of the Minister.” That has been in place since 2011. In the corresponding Act, t he sectoral legislation, which is the Electricity Act . . . the Electricity Act was absent of that particular provision. So, the change we are making today mirrors the Electricity, the —
Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker.
The Sp eaker: Point of order. We will take your point of order.
POINT OF ORDER
Hon. Patricia J. Gordon -Pamplin: Thank you. The Minister is comparing the Communic ations Act with the Electricity Act in terms of the fact that one may have and the other one may not have a particular clause. But you are talking about two com-pletely separate industries, in which the Communic ation Act, there were several communications companies involved. In the Electricity Act there is one major provider of electricity. So, notwithst anding that the wording in the legislation may be different, underneath the Regulat ory Authority, you cannot compare . . . it is like compa ring apples with oranges.
The SpeakerThe SpeakerThank you, Member. Minister ? Hon. Walter H. Roban: May I resume, Mr. Speaker ?
The SpeakerThe SpeakerMinister, continue. Hon. Walter H. Roban: Sectoral legislation for the telecommunications industry, sectoral legislation for the electricity industry, overseen by the Regulatory Act. They play the same role for the two respective industrie s. That is the only real substance here that is essential, and the clause which has already …
Minister, continue.
Hon. Walter H. Roban: Sectoral legislation for the telecommunications industry, sectoral legislation for the electricity industry, overseen by the Regulatory Act. They play the same role for the two respective industrie s. That is the only real substance here that is essential, and the clause which has already been in place since 2011, and certainly a former Government, if they were so aggrieved, could have made the change themselves if they thought there was too much mi nisterial oversight there to reflect what was in, you know, or to reflect in another way. My only point is that the changes we are ma king with the Act that we are discussing today mirrors exactly the same power which exists in the area of telecommunicatio ns for the Minister. So, there is not an overreach here. But I do appreciate the concern of Members, because these are sensitive issues. The question of what happens with the only licensed utility in a country that is the transmitter, distributor and reta iler of ele ctricity is a key factor in what happens with the country, which is the very reason that we are bringing this amendment today. And there are certainly things happening wit hin the scope of that industry that merit the Gover nment having a more special attention to what happens. We do not have a country that has multiple util ities. Now, there are other bulk providers of electricity such as the Government itself —is a bulk provider of electricity. In the future, there will be another bulk pr ovider of electricity, i.e., the Solar Finger, which will be operated on government land and is a government - sanctioned project. But there is only one real key player, and that is Ascendant, which owns BELCO. That makes BELCO, as I outlined in my Statement, a strat egic asset in the eyes of this Go vernment, and for the reasons I stated in my Stat ement. And it is felt as we are in this process with certainly as my change . . . as a change proposed in the Bill talks about the Integrated Resource Plan, which is 1908 21 June 2019 Official Han sard Report
Bermuda House of Assembly going to play a role with shaping the future direction of how we shape our energy infrastructure and platform for years to come, it is important that for all the reasons that we have stated already that the Government have an important say in the protection of the public interest. And that is key to what we are doing here. We are acting in a way that we believe will best protect the public interest. And might I also say that there was some commentary by Members about the role of the regul ator as somehow this check on government power. Well, that may be just one of the roles regulators play, Mr. Speaker. A regulator also plays, and perhaps if Members took time to read the legislation around our regulatory framework, they would also know that there is—and I stated it as well —there is a mandate to pr otect the public interest. And I can say as having had some involv ement with the formulation of the legislation that would become the Regulatory Act and the ECA Act and back in the late —
The SpeakerThe SpeakerMm-hmm. Hon. Walter H . Roban: —from 2009 to 2012, that these acts were chiefly, particularly the Regulatory Act, was to ensure that the public interest will be pr otected, that there was a regulator that would play somewhat of an arbiter between private interests and public int erests. That …
Mm-hmm.
Hon. Walter H . Roban: —from 2009 to 2012, that these acts were chiefly, particularly the Regulatory Act, was to ensure that the public interest will be pr otected, that there was a regulator that would play somewhat of an arbiter between private interests and public int erests. That is one of the key reasons that the Regulatory Authority was created, not just to check on Government power, because that is already . . . and that check is built into the legislation with the processes of appointment with how it operates and how it engages with the Government. No different from the Acts that govern the Bermuda Monetary Authority. Right? But here we are. And we are facing . . . and interestingly enough, it seems as if sometimes Members’ memory get short, because it is not like we have not had a history of where major private assets in the country were being . . . where ownership was being transferred or a l icence to actually operate has not been the subject of legislative oversight. We have seen it in the banking industry here. There was a time when charters had to be approved by the Legislature, and the change of ownership of a charter was the subject of legislative debate. We saw in 2004 with the change of ownership of Bank of Bermuda to HSBC, there was a Government involvement in that. We have seen when a certain bank came into crisis. The Government was asked to get involved and assert itself in the issues around the future of a certain financial entity. And it was asked to provide support for that. I am talking about Bermuda. I could go to other countries and talk about this. So, I think Members need to, in a wider context, understand how things often have to work when you are confronted with unique situations that may have a broader impact on the country that sometimes the G overnment is asked, or if it is in the public interest for the Government to be involved. It happened with HSBC, it happened with Bank of Butterfield, and it has happened where this Legislature was ––and perhaps the legislation was different at that time––b ut it was involved with the transfer of ownership of bank charters, and was required to opine on the change in transfer and control of that instrument which gives a person a licence to operate a bank in the country. And if we even just jump to some other c ountries . . . very recently, I know the mention of the company Renault, a major car company in Europe, and the sale, or a possible sale, of that company, which was su spended because of certain political consider ations in France. We have seen with a company that is not too far from the Bermuda experience, which is Aecon —the proposed sale of Aecon to a pr ivate entity which perhaps has some connection with the Chinese government was the subject of a private interest and a private proposal for sale. It is well known that because of perhaps some concerns by the Canadian gover nment that sale never went through. So, let us move this veil off that somehow there is some suspicion about legislative or Gover nment power having some . . . perhaps in the wider public interest, being involved with the transfer of pr ivate entities, particularly if those private entities have a wider economic or social significance to the jurisdi ction. We have seen it with ports in the United States, proposed sale of ports to foreign entities wher e the US government basically has a say. And because of the strategic nature of those types of sales and how ports operate, and the proposed sale of certain other assets in the United States, the government has said no, not just regulatory approval, but th e actual central governments. So, let us put all that into context. So, I know there was this talk of ministerial overreach of power and so on. But let us be clear. What we have outlined today is an amendment that will ensure that before the Integrated Res ource Plan is published and finalised, that the sale will not go through. It must be subject to that, because the law actually contemplates that the utility and the industry will be subject to that particular Integrated Resource Plan. So, it is to ensure t hat this happens, and there will be no question legally that a future possible owner of the utility will now understand that its operation will be subject to the IRP. Now, there were some other issues that came up in the submissions by Members which I do not want to comment on here, because they pertain particularly to the process of the proposed sale. And I do not want to comment on the merits of the proposed buyer. I do not think that is appropriate, because if we are as Members seen to want to ensure th at if we are governed by a regulatory process, the House should also respect that
Bermuda House of Assembly I do not think this is appropriate because if, as Members seem to want to ensure, we are governed by a regulatory process, the House should also r espect that as well. And that process is subject to regu-latory approval, not only by the regulatory authority of the day . . . let’s just roll that clock back. We have the BMA, we have the Ministry of Finance, we have the Registrar of Companies all playing a role with whate ver trans fer and control may happen, and playing a role with the scrutiny of that proposed sale long before it may even get to the Minister . . . it does get to the Minister if this particular Bill is [passed]. So there is a long process here, and I do not believe it is appropriate for the Minister, being myself, in this Legislature, to make any comment about what may or may [not] happen. But I do believe that I can assure the House that those matters will be the subject of scrutiny of the proposed sale. We will be looking to make sure that the public interest . . . and you can paint that as wide as you wish it to be. And Members in this House today have spoken widely about what that is, what they believe the public interest is. All of that will be a part of the sc ope that will be considered. But the legislative scope of the power of the Minister in this, if there was concern of this, is defined by the Electricity Act, section 6. It is outlined in the directions of which under section 8, the Minister can give, and t hose directions are on the public record. They are not secret. They are not . . . anyone, any member of the public, any Member of this House, can read those directions and ensure that those directions are followed. And they are the refer ence and scope upon which the Minister will make the decision about the merits of the sale at that period of time. With those comments, Mr. Speaker, I would like to now move that the Bill be committed.
The SpeakerThe SpeakerThank you, Minister. We will go to Committee. Deputy? House in Committee at 6 :02 pm [Hon. Derrick V. Burgess, Sr. , Chairman] COMMITTEE ON BILL ELECTRICITY AMENDMENT ACT 2019
The ChairmanChairmanHonourable Members, we are now in Committee of the whole [House] for further consider ation of the Bill entitled the Electricity Amendment Act 2019 . Minister, you have the floor. Hon. Walter H. Roban: Thank you, Mr. Chairman. Mr. Chairman, the Bill seeks to amend the Electricity Act 2016 to …
Honourable Members, we are now in Committee of the whole [House] for further consider ation of the Bill entitled the Electricity Amendment Act 2019 . Minister, you have the floor.
Hon. Walter H. Roban: Thank you, Mr. Chairman. Mr. Chairman, the Bill seeks to amend the Electricity Act 2016 to expand the requirements for granting consent to the transfer or assignment of l icences. Clause 1 is self -explanatory.
The ChairmanChairmanYou want to move— Hon. Walter H. Roban: I’m sorry.
The ChairmanChairman—clauses 1 and 2? Hon. Walter H. Roban: I would like to move all clauses, if that is agreeable to the Opposition.
The ChairmanChairmanHow many, two? Hon. Walter H. Roban: Yes, there are only two.
The ChairmanChairmanYes. Continue. Hon. Walter H. Roban: Thank you, Mr. Chairman.
The ChairmanChairmanUh-huh. Hon. Walter H. Roban: If the Opposition, of course, is agreeable to that. [Inaudible interjection and laughter ] Hon. Walter H. Roban: I am not going to answer that interpolation, Mr. Chairman, I will [keep] my focus on you.
The ChairmanChairmanYes. [Laughter] Hon. Walter H. Roban: Clause 1 is self -explanatory. Clause 2 amends section 30 of the Act. A new subsection (4) provides that the Authority’s consent shall not be given unless an Integrated Resource Plan (IRP) has been approved under section 44(2) and published under section 45 of …
Yes. [Laughter]
Hon. Walter H. Roban: Clause 1 is self -explanatory. Clause 2 amends section 30 of the Act. A new subsection (4) provides that the Authority’s consent shall not be given unless an Integrated Resource Plan (IRP) has been approved under section 44(2) and published under section 45 of the Act and that due regard is had to the IRP when the Authority makes its decision whether or not to give consent. A new su bsection (5) requires the Authority to consult the Mini ster and obtain his approval before it consents to the transfer or assignment of the TD&R Licence (Tran smission, Distribution and Retail) or a Bulk Generation Licence. A new subsection (6) provides that the Mini ster may refuse his approval, but only if he is satisfied that the Authority’s intended consent to the transfer or assignment is not in accordance with the Minister’s directions. Thank you, Mr. Chairman.
The ChairmanChairmanThank you, Deputy. The Chair recognises the Honourable Member Pat Gordon- Pamplin. Ms. Gordon- Pamplin, you have the floor. 1910 21 June 2019 Official Han sard Report Bermuda House of Assembly Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, in respect of clause 2, I am just …
Thank you, Deputy. The Chair recognises the Honourable Member Pat Gordon- Pamplin. Ms. Gordon- Pamplin, you have the floor. 1910 21 June 2019 Official Han sard Report
Bermuda House of Assembly Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, in respect of clause 2, I am just . . . this is clause 2 [amended section 30](4)(a), with respect to the integrated plan, does the Minister have indication as to when the IRP, the Integrated R esource Plan, is likely to be approved and gazetted, or published as it says. Is there any indication? Is it in train? Is it not yet being done? Do we have any idea in that respect?
The ChairmanChairmanMinister, you want to answer that? Hon. Walter H. Rob an: Yes, I am happy to give some clarity to the House on that question. I am going to say a little bit more than I have to, only because I believe it is of public interest about the IRP. …
Minister, you want to answer that?
Hon. Walter H. Rob an: Yes, I am happy to give some clarity to the House on that question. I am going to say a little bit more than I have to, only because I believe it is of public interest about the IRP. The IRP process started in October of 2017 and that process has been ongoing, but the expectation is that this summer the IRP will be published and made available to the public for public consideration. And I am talking about before the end of the summer.
The ChairmanChairmanAny further speakers? Ms. Gordon- Pamplin? Hon. Patricia J. Gordon -Pamplin: Yes, just one ot her. In terms of the Ministerial approval, according to clause 2, where is says, “[(6)]The Minister may r efuse to give his approval under subsection (5), but only if he is satisfied that the Authority’s …
Any further speakers? Ms. Gordon- Pamplin? Hon. Patricia J. Gordon -Pamplin: Yes, just one ot her. In terms of the Ministerial approval, according to clause 2, where is says, “[(6)]The Minister may r efuse to give his approval under subsection (5), but only if he is satisfied that the Authority’s intended consent to the transfer or assignment is not in accordance with any Ministerial directions issued pursuant to sections 8 and 9.” The question that I have is: Does the Minister have any preferential approach towards gi ving this Ministerial direction, or is it all being open and left to the . . . or the presentation of any interested parties and then make the decision at that point? In other words, is the Ministerial interest, or the Ministerial direction, likely to be . . . has it been predetermined that this is a particular framework wit hin which we want to operate, or is it going to be d ependent on whomever decides to make application?
The ChairmanChairmanMinister? Hon. Walter H. Roban: Thank you, Mr. Chairman. Perhaps the Honourable Member does not remember, but I gave a Statement in this House—
The ChairmanChairmanGive it to us now, please. Hon. Walter H. Roban: —about my, like, directions. I believe the date is March 15 [sic]. I gave a Statement and those—
The ChairmanChairmanWhat is the Statement? Just answer the question. Hon. Walter H. Roban: Yes, the Statement gave in detail what those directions are.
The ChairmanChairmanYes, but the— Hon. Walter H. Roban: Those directions are the scope upon which —
The ChairmanChairmanHang on. Hon. Walter H. Roban: I’m sorry. The Chairm an: The Honourable Member is asking a question. We require the answer. Not what you did two months ago, or whatever, just give the answer. Hon. Walter H. Roban: The directions exist already. They have already been made. They had …
Hang on. Hon. Walter H. Roban: I’m sorry.
The Chairm an: The Honourable Member is asking a question. We require the answer. Not what you did two months ago, or whatever, just give the answer.
Hon. Walter H. Roban: The directions exist already. They have already been made. They had to be made public already. Those directions have been gazetted already, as well. And that is the specific scope that the Minister can operate in. It cannot operate outside of those directions in determining the approval, or not approval, of the transfer of control of the licence. T hat is the legal scope that the Minister has to operate in. He cannot operate outside of that.
The ChairmanChairmanThank you, Deputy. Hon. Patricia J. Gordon -Pamplin: Just a quick question for clarity.
The ChairmanChairmanContinue. Hon. Patricia J. Gordon -Pamplin: Can the Minister give us any broad, sort of indication, without . . . I don’t have a copy of the Ministerial Statement from March. I realise that it is probably in the public domain, but I just wonder for the purposes of this, …
Continue.
Hon. Patricia J. Gordon -Pamplin: Can the Minister give us any broad, sort of indication, without . . . I don’t have a copy of the Ministerial Statement from March. I realise that it is probably in the public domain, but I just wonder for the purposes of this, if there is just a broad overview that the Minister might be able to share. If not, that is fine, if he does not have it, but I would be curious for the edification of the pu blic.
The ChairmanChairmanOkay. Minister, can you help her out? Hon. Walter H. Roban: Yes. I will happily give a copy of my March 19 th [sic] Statement to the Honourable Member.
The ChairmanChairmanYes. Hon. Walter H. Roban: And of course my brief ou tlined all of the details that I presented, what those directions are, which is actually section 6 of the Electri city Act. I t is essentially the substance of my directions.
The ChairmanChairmanIs that satisfactory, Honourable Member? Ms. Gordon- Pamplin? Bermuda House of Assembly Hon. Patricia J. Gordon -Pamplin: I’m satisfied.
The ChairmanChairmanOkay. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. I have just been handed a copy of the Minist erial Statement. Actually, this is from Friday, 7 th of June, but it may have what I am looking for.
The ChairmanChairmanOkay. Hon. Patricia J. Gordon -Pamplin: So I will have an opportunity to have a look through and if there are any further questions, I will be happy to ask the Minister offline.
The ChairmanChairmanAny further speakers? Minister. Hon. Walter H. Roban: Thank you, Mr. Chairman. I would like to now move all clauses, be a pproved.
The ChairmanChairmanNumber them. Hon. Walter H. Roban: Clauses 1 and 2.
The ChairmanChairmanMm-hmm. Hon. Walter H. Roban: And I move that the preamble be approved.
The ChairmanChairmanHang on. It has been moved that clauses and 1 and 2 be approved. Are there any objections to that? There appear to be none. Approved. [Motion carried: Clauses 1 and 2 passed.]
The ChairmanChairmanNow you can . . . Hon. Walter H. Roban: Thank you, Mr. Chairman. I move that the preamble be approved.
The ChairmanChairmanIt has been moved that the preamble be approved. Are there any objections to that? There appear to be none. Approved. Hon. Walter H. Roban: Mr. Chairman, I move that the Bill be reported to the House as printed.
The ChairmanChairmanIt has been moved that the Bill be presented to the House as printed. Any ob jections to that? The Bill will be reported to the House. Thank you. [Motion carried: The Electricity Amendment Act 2019 was considered by a Committee of the whole House and passed without amendment.] House …
It has been moved that the Bill be presented to the House as printed. Any ob jections to that? The Bill will be reported to the House. Thank you.
[Motion carried: The Electricity Amendment Act 2019 was considered by a Committee of the whole House and passed without amendment.]
House resumed at 6:10 pm
[Hon. Dennis P. Lister, J r., Speaker, in the Chair]
REPORT OF COMMITTEE
ELECTRICITY AMENDMENT ACT 2019
The SpeakerThe SpeakerMembers, are there any objections to the Electricity Amendment Act 2019 being reported to the House as printed? There are none. It has been moved and approved, reported. We now move on to the next item on the O rder Paper for today. And that item is the Bermuda Economic …
Members, are there any objections to the Electricity Amendment Act 2019 being reported to the House as printed? There are none. It has been moved and approved, reported. We now move on to the next item on the O rder Paper for today. And that item is the Bermuda Economic Development Corporation Amendment Act 2019 in the name of the Premier. Premier, would you like to present your item?
Hon. E. David Burt: Certai nly, Mr. Speaker. Mr. Speaker, I move that the Bill entitled the Bermuda Economic Development Corporation Amendment Act 2019 be now read the second time.
The SpeakerThe SpeakerAny objections to that? No objections? Continue on, Premier. BILL SECOND READING BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019 Hon. E. David Burt: Thank you, very much, Mr. Speaker. Mr. Speaker, the Bill before the House today seeks to amend the Bermuda Economic Development Corporation Act 1980 to permit the …
Any objections to that? No objections? Continue on, Premier.
BILL
SECOND READING
BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019
Hon. E. David Burt: Thank you, very much, Mr. Speaker. Mr. Speaker, the Bill before the House today seeks to amend the Bermuda Economic Development Corporation Act 1980 to permit the Bermuda Econo mic Development Corporation to form subsidiary companies, or join in the incorporation of any company to further any public/private partnership in keeping with the functions of the Corporation. The Bermuda Economic Development Corporation [BEDC] is a provider of business management advice and financial assistance to the local small and medium -sized business sectors in Bermuda. The BEDC is currently responsible for overseeing the operations of the Economic Empowerment Zones (EEZ), for providing financial support and tec h1912 21 June 2019 Official Han sard Report
Bermuda House of Assembly nical advice to small and medium -sized businesses, for managing the operations of outside vendor markets, and for managing vendors in issuing vendor l icences. Since the establishment of the 1980 Act, and a partnership between the Bermuda Government and the local banks, the BEDC has been, and continues to be, Bermuda’s premier source of free confidential advice for entrepreneurs and business owners. BEDC’s mission is to inspire, inform, support and grow new and existing businesses through e ducation, guidance, data provision, ad vocacy , networking, and financing. The Corporation has a focal vision of helping to create an expanded pool of inspired entrepreneurs running successful businesses that fuel Bermuda’s economy. The Bermuda Economic D evelopment Corporation’s remit has expanded significantly over its lifespan. Originally conceived in 1980 as the Bermuda Small Business Development Corporation to only have responsibility for the Island’s small businesses, in 2011 its responsibility grew t o embrace the Island’s medium -sized business sectors, the three Economic Empowerment Zones, and establish vendor market sites. Then, in 2015, its remit was expanded again to have legislative oversight of all of the Island’s local pedlars and vendors. Mr. Speaker, today we are here to mark the continued evolution and expansion of the Bermuda Economic Development Corporation with this new amendment to its legislation. The amendment will allow the BEDC to enter into formal corporate arrangements in associati on with other persons for the purpose of aiding those persons in the development of a new business, or a new undertaking. The Corporation’s key objective remains to assist the Government in encouraging economic growth for Bermuda’s local small and medium -sized businesses. However, increasing numbers of entr epreneurs are seeking more than just investment capital or loan guarantees in support of their endeavours. As such, the BEDC is committed to developing a range of creative business support services and products to meet the needs of modern business. To take advantage of the protections afforded to incorporated entities, entrepreneurs often seek the added assi stance of BEDC as more than a lender or guarantor. Mr. Speaker, the BEDC currently has, through section 5(2) of this Act, the power to borrow money, lend money, to make grants or guarantee loans, and to acquire, hold and dispose of personal and real property. The BEDC can also do anything incidental to any of its powers. Whilst the broad power currently contained in section 5 of the BEDC’s Act may already lend itself to create subsidiaries, it was recommended that out of an abundance of caution the specific powers to create subsidiaries be included in the Act. The proposed amendments will allow the B EDC the specific power to engage in the incorporation of entities in support of public/private partnerships. In addition, as part of the incorporated entity, the BEDC would have the opportunity to exercise greater oversight in support of the businesses supported through its existing powers. The amendments will only focus on local companies, or LLCs, this, with the goal of specifically assisting in the development of new business ventures. Ministerial approval will be required for the formation and divestm ent of any company through this provision, and the BEDC will divest itself of its shares in a local company, or resign its membership in a local LLC as soon as it has fulfilled its purpose. Mr. Speaker, with this legislative amendment the Government desir es to continue to create an env ironment where entrepreneurs can benefit from economies of scale through the creation of shared assets. This also includes shared infrastructure. The ability for the BEDC to create subsidiary companies based on a public/priva te partnership model will progress this concept of shared assets for entrepreneurs. We currently see the beginning of this concept with the BEDC’s incubators, shared spaces, shared resources, and shared supports. The BEDC has the resources and structures to partner with entrepreneurs to more easily bring their ideas to market, stay in partnership beyond those cri tical start -up years, the first three to five years, and then exit the company once it is solidified. These par tnerships are even more critical if the company operates in an industry the Government is desirous of growing. It is anticipated that the implementation of this new legislation can be managed from within the Bermuda Economic Development Corporation’s exis ting resources and funded from withi n the Bermuda Economic Development Corporation’s existing budgets. In closing, Mr. Speaker, a key national objective continues to be entrepreneurship. Bermuda’s l ocal small- and medium -sized businesses are the lif eblood of our Island’s economy. As such, t he Gover nment of Bermuda intends, through this legislative amendment, to broaden its reach to foster local ec onomic development activity. Without question, the Government is serious about encouraging a viable and reputable local entrepreneurial environment with the BEDC providing tangible support and advice. To this end, the Government will continue to ensure that local economic development is a priority by putting businesses and entrepreneurs first and creating sound, progressive policies for their success . Mr. Speaker, what I will say before I close is that we have already done a number of items inside of our platform to make sure we help small business, whether that was a doubling of the guarantee capacity for the Bermuda Economic Development Corporation, whether that was the elimination of taxes for new start-up businesses, making sure that businesses have easier access for start -ups, and now we have
Bermuda House of Assembly the new programmes which are giving direct micr oloans, which you have seen, have new businesses starting up and for persons employed. This is continuing on the Government’s agenda making sure that we support entrepreneurs.
[Hon. Derrick V. Burgess, Sr., Deputy Speaker, in the Chair]
Hon. E. David Burt: With those remarks, Mr. [Deputy] Speaker, I now invite the Honourable Members to participate in this debate. Thank you.
The Deputy SpeakerDeputy SpeakerAny further speakers? The Chair recognises the Honourable Member Pat Gordon- Pamplin. Ms. Gordon- Pamplin, you have the floor. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Deputy Speaker. I just had a couple of questions based on the presentation that the Premier has given. Firstly, he spoke to the …
Any further speakers? The Chair recognises the Honourable Member Pat Gordon- Pamplin. Ms. Gordon- Pamplin, you have the floor.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Deputy Speaker.
I just had a couple of questions based on the presentation that the Premier has given. Firstly, he spoke to the actions that have been taken by this Government with respect to doubling the capacity of available funding, no taxes f or start -ups, and the m icroloan programme that has been implemented. And I just wondered if the Premier can give us some indic ation from a public perspective in terms of what is the uptake on the provision of loans and the provision of funding in terms of what capacity, the capacity is there, but what of the capacity has been used? That is just a general information [question]. Now, according to the legislation that we are debating, and according to the Premier’s information, under the BEDC they will be able to purchase shares in a local company. And I heard the Premier say that in a period of between three and five years that i nvestment (as it were) of public funds into these entr epreneurial opportunities will reach its maturity (if I can put it that way) over that period of time. I guess that is the initial intent. Whether it needs to be longer or shorter, obviously, will depend on individual circum-stances. But I have to question how this actually is g oing to work. If we are talking about a new start -up, then perhaps there is not a whole lot of equity value in a new start -up. But what happens at the point in time that over that three- to five -year period of time when the BEDC has determined that their involvement has reached its natural end, what methodolo gy will they use in order to divest themselves of the interest? Is it going to be based on the amount of money that was put in at the outset? Is it going to be at an appreciated value if the company into which they have put money has now grown significant ly so it has a far higher equity value, far higher book value, than at the purchase date? Is there likely to be some clawback, as it were, of any benefit that the public money has been used [for] in stabilising this company and helping to grow the company? Will the Government or the BEDC, through their funding, get any benefit out of the divesting of the interests of the BEDC? The other question that I had was . . . when the BEDC, in purchasing shares of a company, it shall become a director and a chief executive. My question is, when we are talking about the BEDC, which is assisting an entrepreneurial company to get off the ground, the question begs, if you have . . . you know, the Honourable Member Mr. Simons has decided that he has got this wild and wonderful idea, business ve nture and the like, and he gets in and he grows it, and it becomes really super successful. But it is an inves tment in widgets. And do we have the expertise within the BEDC to become the chief executive of that company when effectiv ely the business idea and the promulgation of that idea rests with the entrepreneur. I am just a little bit curious to understand how it would actually work for the BEDC to become the chief executive of an entity over which they may not necessarily have t he specific expertise to be able to manage and to grow that business to its ultimate excess.
The Deputy SpeakerDeputy SpeakerMember, please speak into your microphone. Hon. Patricia J. Gordon -Pamplin: Yes, surely. Certainly, yes.
The Deputy SpeakerDeputy SpeakerThank you. Hon. Patricia J. Gordon -Pamplin: So those were my questions. Obviously, I understand what it is that they are trying to do, but the terminology of the legislation as it presently exists is giving us cause for concern from a pure business perspective. From an accounting perspective, obviously, …
Thank you.
Hon. Patricia J. Gordon -Pamplin: So those were my questions. Obviously, I understand what it is that they are trying to do, but the terminology of the legislation as it presently exists is giving us cause for concern from a pure business perspective. From an accounting perspective, obviously, it is my concern, if we take $100 out of public funds to put into this company, when all is said and done are we going to get $100 back? Are we going to get $150 because the equity in the company has grown? The corollar y of that is, we put $100 into a company today, what happens if that business does not succeed? Because I believe that history has shown us that a significant number of new start -ups do not actually succeed. So I am just wondering what we have put in place in order to minimise and to am eliorate any negative impact of the financing that is go-ing to be put into any of these start -up and entrepr eneurial opportunities, if they are not as successful as we would hope. So those are my questions, and presumably I will get the answers when the Premier is ready to wrap. Thank you.
The Deputy SpeakerDeputy SpeakerAny further speakers? 1914 21 June 2019 Official Han sard Report Bermuda House of Assembly The Chair recognises the Honourable Member Ms. Atherden. You have the floor. Hon. Jeanne J. Atherden: Mr. Deputy Speaker, through you to the Mi nister, and perhaps this is just for clarification. When I read …
Any further speakers? 1914 21 June 2019 Official Han sard Report
Bermuda House of Assembly The Chair recognises the Honourable Member Ms. Atherden. You have the floor.
Hon. Jeanne J. Atherden: Mr. Deputy Speaker, through you to the Mi nister, and perhaps this is just for clarification. When I read the section which talks about the Corporation purchasing the shares and shall be appointed a director and the chief executive of the company, I guess it would be useful for us and for the public to understand how the BEDC, as a corporation, would exercise this function. Recognising . . . and this is sort of partially what my colleague was saying, rec-ognising that one presumes that there will be an “ind ividual” that will be the chief executive officer, and therefore I am just curious as to how that person is chosen. And the other side of it is, while I understand why the BEDC in the past has loaned money to particular entities because they believe those entities have a product or an initiative t hat they believe is worthy of investing in and it has got some potential for success, I just wondered why one would decide that it is important to be the chief executive officer as opposed to being on the board. I mean, that then takes a whole stream (if y ou will) of expertise, et cetera. I know that the BEDC has lots of expertise in terms of managing, in terms of directing, but I just wondered why they would, you know, shift that to chief executive officer which then presumes that you have lots of specialty in a number of areas. I just wondered if the Minister could explain why they decided to go from the role of being an i nvestor to the role of being a chief executive officer, recognising that, I would presume, there are going to be a number of companies that the BEDC is going to invest in, and they are going to be done simultaneously because, based on what has been said in the past, and the Minister’s indication that this is part of their programme, and I am certain that it is going to be expanding.
The Deputy SpeakerDeputy SpeakerAny further speakers? The Chair recognises the Honourable Member, Ms. Leah Scott.
Ms. Leah K. ScottThank you, Mr. Deputy Speaker. I would like to support the legislation. I think that it is a good idea. I am happy that entrepreneurship is being promoted. I guess with a corporate background, my concerns are just making sure that things are done correctly and that things are put …
Thank you, Mr. Deputy Speaker. I would like to support the legislation. I think that it is a good idea. I am happy that entrepreneurship is being promoted. I guess with a corporate background, my concerns are just making sure that things are done correctly and that things are put in place correctly. I noticed that the legislation says that the BEDC will purchase shares in the company. So I am just wondering, in terms of how they are going to structure these things, whether the BEDC is actually going to set up a joint venture company and then that joint venture company would then participate in the ventures and investing in the businesses of the entr epreneurs? Or how is it going to be a shareholder?
Ms. Leah K. ScottThe other question is, under [clause 5] [new section 13A] subsection (3)(a), the BEDC will be appointed a director and a chief exec utive officer . Will it be the entity itself, or will it be a re presentative of the BEDC that is going to represent? Does the BEDC …
The other question is, under [clause 5] [new section 13A] subsection (3)(a), the BEDC will be appointed a director and a chief exec utive officer . Will it be the entity itself, or will it be a re presentative of the BEDC that is going to represent? Does the BEDC have the capacity to even be a corporate director? Does the BEDC have the capacity to even be a shareholder? And once the BEDC enters into these arrangements with a local company, is it envisaged that they will have a shareholder’s agreement and that shareholder’s agreement will actually set out the terms of the relationship, how they are entering into the relationship, how many directors the BEDC gets to have, how long the relationship will last, how you get out of the relationship? So if I go to the BEDC and I say, I would like to set up a company. I would like to borrow $10,000. And the BEDC says, That’s fine. We’ll lend you the $10,000 and we will help you incorporate a company. We set up the company and the BEDC becomes a director. As the company grows and I pay back that $10,000 loan, does that mean that the pur-pose for which the BEDC was belonging to that company has now been fulfil led? I have repaid the terms of the loan and then they will exit? How will they exit? The other thing is, you know, directors require personal liability. And so, is the BEDC going to have insurance to cover the people that it is going to appoint as direc tors and shareholders of these entities? How are they going to protect themselves? Because directors’ and officers’ liability insurance is expensive. So, just in terms of, you know, I fully support entrepreneurship. I think that it is an excellent idea and I have other questions that I could probably take offline and go to the BEDC and find out more information, but generally, just in terms of the overall structure, I would like to see a structure in place that pr otects both the BEDC and its representativ es and the people who are going to be working with the BEDC with their investments. Thank you, Mr. Deputy Speaker.
The Deputy SpeakerDeputy SpeakerAny further speakers? The Chair recognises the Honourable Member Hadley Cole Simons.
The Deputy SpeakerDeputy SpeakerNelson, I forgot Nelson. Bermuda House of Assembly [Laughter]
Mr. N. H. Cole SimonsMr. Deputy Speaker, I, like the rest of my colleagues, support the endeavours of the BEDC. I support their role in economic growth for small businesses and medium -sized businesses.
Mr. N. H. Cole SimonsI support their ability to pr ovide advice, inspiration, guidance, networking, financing, et cetera. The issue of directorship, obviously, has been the topic of the day. My question to the Minister is: What criteria, or what trigger, will the BEDC have in place to say, It’s time for me to …
I support their ability to pr ovide advice, inspiration, guidance, networking, financing, et cetera. The issue of directorship, obviously, has been the topic of the day. My question to the Minister is: What criteria, or what trigger, will the BEDC have in place to say, It’s time for me to get involved in this company ? And can an entrepreneur invite the BEDC, or a representative from the organisatio n to sit on their board? What protocols or criteria are in place for the appointment of these directors? As was said earlier, I have no objections with the appointment of directors. I have some concern about the appointment of the CEO. As my colleague indi cated earlier, the CEO’s appointment should be left to the entrepreneur who knows the business. To me, the director should provide guidance from a strategic point of view. They should provide guidance from a reputational risk point of view. They should pro vide guidance from a financial risk point of view. They should provide guidance from a compliance to the Companies Act [point of view], and also [from a] financial point of view. To me— Hon. E. David Burt: Mr. Deputy Speaker.
The Deputy SpeakerDeputy SpeakerYes. Hon. E. David Burt: Point of clarification, if the Honourable Member will yield.
The Deputy SpeakerDeputy SpeakerMm-hmm. POINT OF CLARIFICATION Hon. E. David Burt: I just want to, for a general basis, because I see where the debate is, and I just want to make sure that I remind Members opposite, and for the edification of the entire House, this has to deal with wholly owned …
Mm-hmm.
POINT OF CLARIFICATION
Hon. E. David Burt: I just want to, for a general basis, because I see where the debate is, and I just want to make sure that I remind Members opposite, and for the edification of the entire House, this has to deal with wholly owned subsidiaries, where there are no other parties involved, which the BEDC set up, and then joint ventures, and the various things are there that are applicable. So, when we are talking about the issue of a CEO of a company serving in that capacity, for a wholly owned subsidiary is one thing, whereas there may be a joint venture for a public/private par tnership. So I just want Members to realise that there are multiple different types of structures, and I do not want us to purely focus on one portion where an entrepreneur may, you know, where we may want to put in a structure where you have convertible debt from a microloan or something else. It is to add the additional flexibility. So I just want Members to know that there are multiple different things. So the CEO might be a part of a wholly owned subsidiary, whereas a member of the board or other type of advisement [can] be something inside of a joint venture, and the flexibility that is here that . . . [so there is flexibility for each option]. I could have saved that to the end, Mr. Deputy Speaker, but it might help for the debate so Members can understand. Thank you.
Mr. N. H. Cole SimonsYes, so I think . . . I take the Premier’s comments and I also take the view that if the officers of the BEDC take a more active role in providing guidance from a director’s level, then we have to ensure that those employees who are i nvolved at …
Yes, so I think . . . I take the Premier’s comments and I also take the view that if the officers of the BEDC take a more active role in providing guidance from a director’s level, then we have to ensure that those employees who are i nvolved at the director’s level and providing guidance from a strategic point of view, reputational risk or risk point of view, compliance point of view, that they have the appropriate training to ensure that those bus inesses get the best advice, that they are directed for best practices and that, you know, they look at costs based on what is in Bermuda. I declare my interest, my wife is chairman of the Institute of Directors, and I know that they would be willing to help these small businesses as they evolve, and also provide support to the BEDC and other organisations. To me, it is about governance. It is about su pporting our reputation, and it is also about helping the entrepreneurs to become better leaders of their industry of their businesses. I mean, as I said, the role of director is to provide guidance, support, resources, networking, and some handholding to ensure that their businesses succeed based on best business practices. So, again, I would like to ensure that some type of training programme is in place for the appointment of the directors of these companies because it is a serious issue. And I think the entrepr eneurs deserve the best support, the best guidance, and the best directorship that is available on this I sland. Again, my question is: What criteria will be implemented so that the BEDC can decide, Well, the development of this start -up is at a level that really requires our assistance. What would that level be? What criteria would trigger the BEDC to appoint a d irector? Or, if I have small business and I invite the BEDC to become a director, what criteria will the BEDC use to accept the invitation? So, again, just general questions. I might have some more in the Committee discussions. I would like to start off wi th that. Thank you, Mr. Deputy Speaker. 1916 21 June 2019 Official Han sard Report
Bermuda House of Assembly The Deputy Speaker: Any further speakers? Premier, you have . . . I’m sorry. Mr. Tyrrell. Honourable Member, you have the floor.
Mr. Neville S. TyrrellThank you, Mr. Deputy Speaker. Sorry I was so slow at getti ng up that time.
Mr. Neville S. TyrrellI certainly wish to support this Bill, the Bermuda Economic Development Corporation Amendment Act 2019. I thank the Premier for bringing it forward. I am almost tempted to describe it as being transformational because it certainly lends itself to what this Government is trying to do in terms of hel …
I certainly wish to support this Bill, the Bermuda Economic Development Corporation Amendment Act 2019. I thank the Premier for bringing it forward. I am almost tempted to describe it as being transformational because it certainly lends itself to what this Government is trying to do in terms of hel ping, certainly, small business or small businesses. But my two main reasons for supporting . . . well, my main reason for supporti ng this Bill is sort of twofold. As I said, I certainly feel it is transformational and it is something that [supports] our decision that we have made, it is in our Throne Speech, our Speech from the Throne, to help small businesses. And it also goes to the fact that where we are making tough decisions and not shying actually away from, or shirking away from them, especially if it is going to be of a benefit to . . . whether it is a segment of the population or a m ajority of the population, those that we call Mr. and Mrs. Bermuda. Secondly, I have several small to medium business entrepreneurs in my constituency who talk to me all the time about help from the Government and they are certainly [praising] some of the things we have done. Of course, some of t hem are of more longterm and have sort of an effect now, but later on down the road they will see exactly the direction that we are going. So, certainly, as I said, these entrepreneurs have already been assisted by the BEDC and they speak very highly of t he help that they have been getting from them. So I certainly want to congratulate the management there. Let me say that the amendment that I certai nly have some interest in, if you don’t mind, Mr. Deputy [Speaker]. It is clause 3 —
Mr. Neville S. TyrrellMr. Deputy Speaker, most of these aspiring business entrepreneurs generally look like me, so I certainly encourage this. But I also encourage other entrepreneurs as well to direct their attention to the BEDC because they can certainly get the help. The playing field for a very, very long time has …
Mr. Deputy Speaker, most of these aspiring business entrepreneurs generally look like me, so I certainly encourage this. But I also encourage other entrepreneurs as well to direct their attention to the BEDC because they can certainly get the help. The playing field for a very, very long time has been not even, certainly not level. And so I see this as an opportunity for them to go and get assi stance. Finally, Mr. Deputy Speaker, as I said, I support this amendment because, as it was stated earlier, nothing should be left off the table, everything should be discussed, and I think this is going to be a help in general. Thank you, very much, Mr. Deputy Speaker.
The Deputy SpeakerDeputy SpeakerYou are welc ome. The Chair recognises the Honourable Member Christopher Thomas Famous.
Mr. Christopher FamousGood evening, Mr. Deputy Speaker. Good evening, colleagues. Good evening, Bermuda, and to everyone else who is listening. Mr. Deputy Speaker, I am going to speak, not to the clauses because you are going to tell me to sit down. [Laughter]
Mr. Christopher FamousBut I am going to speak to the spirit of the Bill. [Inaudible interjections]
Mr. Chris topher FamousYesterday, or two days ago, there was an announcement of one business being sold, or being bought by another business. In normal circumstances, no one would have batted an eyelash. But somehow, because somebody who, I don’t know, did not gro w up on Front Street, is buying this business, …
Yesterday, or two days ago, there was an announcement of one business being sold, or being bought by another business. In normal circumstances, no one would have batted an eyelash. But somehow, because somebody who, I don’t know, did not gro w up on Front Street, is buying this business, the question is asked, Where did he get that money? Where did he get that money?
The Deputy SpeakerDeputy SpeakerMm-hmm. Bermuda House of Assembly Mr. Christopher Famous: Well, let me tell you where he got that money. My family came here, well, some of my family came here from St. Kitts with nothing. My grandfather used to have to sell pigs and bananas. He passed that on to his …
Mm-hmm.
Bermuda House of Assembly Mr. Christopher Famous: Well, let me tell you where he got that money. My family came here, well, some of my family came here from St. Kitts with nothing. My grandfather used to have to sell pigs and bananas. He passed that on to his children and his grandchildren. This one particular grandchild took that family trait and carried on. He grew bananas and sold them. Then he started buying other businesses, cleaning pools. Not making any money, but building connections, building up business knowledge because there was no formal place to learn and teach you how to be a busines sperson, outside of certain things. Mr. Deputy Speaker, at age 14, I wrote a letter to the then Premier. I am not going to say who, but you can take guess who that was. I wrote a letter. There was no email, no WhatsApp, I wrote a physical letter and said, I would like to learn about business things. I got a call maybe two days, three days . . . well, sorry, two weeks later, because it was snail mail, that said, Go see this lady at this building called Me lbourne House. Melbourne House, for those who do not k now is on Victoria Street w here Weir Enterprises is , they got the blue building, anyway, there is a small, one - person operation called — [Inaudible interjections]
Mr. Christopher FamousYes, where Sound Stage used to be. There was a small, one- person operation with very [few] re sources to teach a person how to start a business or grow a business. [Inaudible interjections]
Mr. Christopher FamousMr. Deputy Speaker, I am proud to see the small business corporation now b ecome the Bermuda Economic Development Corpor ation. You know why, Mr. Deputy Speaker? We sit around this room, and for the last 21 years, give or take a little bump in the road between 2012 and …
Mr. Deputy Speaker, I am proud to see the small business corporation now b ecome the Bermuda Economic Development Corpor ation. You know why, Mr. Deputy Speaker? We sit around this room, and for the last 21 years, give or take a little bump in the road between 2012 and 2017, we have had political power in this country. But you know what? For 400 years we never have had ec onomic power.
[Inaudible interjections] Mr. Christopher Famous: And this Government has to transform this thing.
Mr. Christopher FamousMuttering. Mr. Deputy Speaker, through the BEDC and other organisations , this Government is going to help her people transform themselves from simply being employees to being business owners. Because, as we all know, Bermudians spend plenty of money educat-ing their children, hundreds of thousands of dollars. They come back …
Muttering. Mr. Deputy Speaker, through the BEDC and other organisations , this Government is going to help her people transform themselves from simply being employees to being business owners. Because, as we all know, Bermudians spend plenty of money educat-ing their children, hundreds of thousands of dollars. They come back here and either cannot get a job or cannot get a job in the field [in which] they studied. Or, if they do get a job, five years down the line, somehow or the other, they are being made redundant. So what do we need to do? We need to teach our people how to start their own businesses, how to sacrifice for those three, four, five, six, seven years to make those businesses successful. But it is more than a sacrifice, it is knowledge. It is having the knowledge. Not everybody can go back to school and learn and get an MBA [ Master of Business Administration] . So the BEDC provides courses. Let me make it a little bit more personal, Mr. Deputy Speaker. Eight years ago my wife started a business. She has been through numerous BEDC courses, left, right, and centre— accounting course, QuickBooks courses, StreetWise “MBA” —all these courses. Her business . . . because I do not get an ything out of it —
[Inaudible interjections and laughter]
Mr. Christopher FamousOkay, I get a free haircut. Her business has become— [Inaudible interjections and laughter ]
Mr. Christopher FamousHer business has been relatively successful in a short period of time. But it is only because . . . not only, but it is because of the help she has [received] from the BEDC, Mr. Ray Jones, in particular ; [Jamillah] at Mind Your Business; and before that, Ms. …
Her business has been relatively successful in a short period of time. But it is only because . . . not only, but it is because of the help she has [received] from the BEDC, Mr. Ray Jones, in particular ; [Jamillah] at Mind Your Business; and before that, Ms. Roxanne Christopher; Ms. Smith. I could go on . . . Ray Lambert. They have all helped her and 1918 21 June 2019 Official Han sard Report
Bermuda House of Assembly countless others, so I can speak to the success of BEDC and the dedication that they have. Again, Mr. Deputy Speaker, we have a r esponsibility to try and help those who are willing to transform themselves from simply being employees, highly paid, highly educated employ ees, to being employers, being business owners. But I say to them, the sacrifice has to start now. A business is not going to be successful overnight. Some people have had 400 years of, you know, perfecting their business. We do not have that. So if you ar e willing to do that, the BEDC is there for you. You have to take advantage of it. And I glory in the spirit of this Bill. I will not get into the details of it because, quite frankly, I am not that guy. But what I do know, Mr. Deputy Speaker, is that fiv e years from now we have to see more Berm udian business owners. We have to. As we heard earl ier, we are under threat. Bermuda’s landscape is not going to be the same five years from now [like] it was 10 years ago. What are those people who got mas-ter’s degrees going to do? What are they going to do? They are going to have to do something. So, I say to those, again, to those who are thinking about starting a business, Don’t just willy -nilly do things. The BEDC provides free advice, free edu-cation, free cours es. These are your tax dollars ; take advantage of it. Now, specific to this Bill, I am not going to go into just . . . I am glad to see that there is pu blic/private oversight. I am glad to see there is shared assets and shared spaces, and I am glad to see that the overarching (what is the word I want to use?) spirit of this Bill is to help transform our country, our cou ntrymen, countrywomen. Because, again, I go back to yesterday when I read this, when this person said, Where did he get this money? I was s o incensed b ecause that person is my brother. And what that person was saying is that black people are not supposed to have money. And we have to— we have to —break that mind -set, not of those who do not like us, but of ourselves!
Mr. Christopher FamousWe have put in our own minds, We are going to be business owners! Because, guess what, Mr. Deputy Speaker? People have for years talked bad about the Caribbean. You go to any Caribbean island, you walk around their capitals, those buildings are owned by black people. You walk around …
We have put in our own minds, We are going to be business owners! Because, guess what, Mr. Deputy Speaker? People have for years talked bad about the Caribbean. You go to any Caribbean island, you walk around their capitals, those buildings are owned by black people. You walk around our capital, who are these buildings owned by? Not us! Who are the major businesses owned by? Not us! [Inaudible interjections]
Mr. Christopher FamousSo, again, the mind- set has to change wit h us. And I am glad that the BEDC has transformed from that one- person operation to what they are now. And I say to the Premier, Thank you, Mr. Premier. To the staff at the BEDC, Thank you, very much. …
The Deputy SpeakerDeputy SpeakerThank you, Honourable Member. Any further speakers? Mr. Premier, take . . . you have it. Hon. E. David Burt: Mr. Deputy Speaker, I want to thank the Members for their contributions to this particular debate. I would like to echo the comments from the Honourable Members from constituency 26, …
Thank you, Honourable Member. Any further speakers? Mr. Premier, take . . . you have it.
Hon. E. David Burt: Mr. Deputy Speaker, I want to thank the Members for their contributions to this particular debate. I would like to echo the comments from the Honourable Members from constituency 26, Warwick South Central, and constituency 11, MP Christopher Famous, who spoke about the excellent work that is being done by the members of the Bermuda Economic Development Corporation, the staff, and their em-ployees that are there. I had the pleasure of having that department underneath my ministerial remit. B efore me, it was Minister Jamahl Simmons. And both of us have had an extremely pleasurable experience with both the board and also the team which is there. And I w ould like to, of course, recognise Ms. Erica Smith, who is here joining us today, Mr. Speaker.
[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]
The SpeakerThe SpeakerMm-hmm. Hon. E. David Burt: I would like to say that I am pleased with the support of the Members for this particular piece of legislation. I am grateful that certain Members understand what a game changer that this can actually represent, and the additional flexibility which is a necessary …
Mm-hmm. Hon. E. David Burt: I would like to say that I am pleased with the support of the Members for this particular piece of legislation. I am grateful that certain Members understand what a game changer that this can actually represent, and the additional flexibility which is a necessary requirement. And oftentimes, Mr. Speaker, people will he ar me talk about the fact that we have institutions which were built under structures that cannot necessarily deliver and are not nimble and flexible enough to deliver for the future. And so, what we are doing here is allowing an organisation that has a reputation that can assist entrepreneurs, and [this will] provide them additional ways in which to assist entrepreneurs. There were a few questions that were asked. There was a question from the Honourable Member for constituency 23 about the volume of support of which Bermuda Economic Development Corporation gave. There are currently 18 existing guarantees for a total of $1.3 million. But what is more remarkable is that what is very popular, of course, is the direct lending programme from the Bermuda Economic Deve lopment Corporation, and that is the microloan pr ogramme. There are currently 43 direct microloans. The total balance outstanding on those microloans is
Bermuda House of Assembly $463,342. Of note, Mr. Speaker, there are no losses yet, and only one loan has been called and the [dollar] amount that was remaining on the [loan] that was called was $1,202.
[Inaudible interjections]
Hon. E. David Burt: So, now, Mr. Speaker, I know that there were a lot of questions which were asked about valuations and different things. And w hat I am saying is that the Bermuda Economic Development Corporation is not intending on reinventing the wheel. There are many types of organisations that exist in venture capital funding, seed funding. Those types of assistance and those types of structur es are relatively common, and the Bermuda Economic Development Corporation feels relatively confident and sees that it could take advantage of those things. But what it can also do, Mr. Speaker, is assist companies that may be cooperatives in setting up their corporate arrangements and actually playing a part in that. So when we are talking about shared assets and some of the examples which I have given, and I will give at this point in time, Mr. Speaker, is that, for instance, people, you know, want to engage in a certain activity. And let’s say that certain activity is screen printing for shirts and other types of things. And say, for instance, there are five individuals who come to the BEDC looking for money for this activity. And as opposed to the BEDC g iving out five separate micr oloans, or five separate grants, or to five different people $10,000, maybe they buy a really big machine, a very powerful one for $25,000 and it is shared amongst the persons who are a part of this. Because one of the things t hat we have and one of the challenges for entrepreneurs in the Berm uda economy, Mr. Speaker, is that the Bermuda econ-omy is very small. So it is difficult to scale. And if you make a very large upfront investment, it is more diff icult to recoup from that i nvestment. But we also have assets which are not fully utilised. So if you have shared assets that can be more fully utilised, then that means that you have a lower start -up cost and you can get a better return while also providing more competitive pricing. And what you would have seen, as we have stated inside of our election platform, speaking about cooperative economics, what you would have seen with the BEDC insofar as pushing cooperative ec onomics, it is those types of things which we are look-ing to promote. And the flexibility which is allowed underneath this particular amendment which we are do-ing today, will allow those types of structures that can be set up with the assistance of the BEDC to assist in those particular areas. And that is what it is that we are looking to do, Mr. Speaker, to provide different ways to make sure that we can assist entrepreneurs and other persons in getting started and looking at new ways of doing things in 2019, as opposed to the original construct of the Act in 1980. Now, Mr. Speaker, there was a lot of questions and I note that the Honourable Member from constituency 8 declared his interest, that his wife is the director [sic] of the Institute of Directors and —
[Inaudible interjectio n]
Hon. E. David Burt: —the Chai rman, and she is a lways writing these wonderful pieces in the paper, promoting her organisation very well. What I will say to that Honourable Member is that any item which is necessary to facilitate the proper establishment of arrangements to be done, whet her that is insurance, directors, qualifications, et cetera, will be taken on by the BEDC. The BEDC does have a very good board. That board, I have found, is incredibly attuned to risk and making sure that those things are handled. And I am certain that these things will be taken into account. And I thank the Honourable Member for his question on that. There was a question that asked, What crit eria may the BEDC look at? I think that there is not necessarily a criterion in where the BEDC will look to be inv olved. I think it will be if a company, whatever structure and in looking at how these things are going to be arranged, may want to have participation from the Bermuda Economic Development Corporation. It may be that microloans right now are limited to $20,000. The BEDC is looking at upping that limit to a little bit more. It may be that a combination of tradi-tional collateral on convertible debt from different structures, and equity base in convertible debt, there are lots of different things that could be there, but this is to allow flexibility away from just the traditional modes of financing and/or business support which we have [when] the BEDC issues a loan guarantee, or more recently gives a (how would I say?) direct micr oloan. And as I indicated when the Honourable Member from constituency 8 was grateful to yield for a point of clarification, there are joint ventures. But there may also be subsidiary companies. And so this type of arrangement allows for multiple different types of set-ups. So, for exam ple, there may be a wholly owned subsidiary, Mr. Speaker, where the BEDC may set up a vehicle or a subsidiary to finance the purchase and bring on investors for the upgrade of a property in one of the Economic Empowerment Zones, for instance, and allow it to raise capital for that and to have per-sons be a part of that capital structure so that there can be improvements that are done in any of the Ec onomic Empowerment Zones. It can also be a joint venture. An example that I will give is maybe a joint venture with a local credit union to provide banking services to those persons and businesses who are unable to get banking services in other places. There is an issue with being un1920 21 June 2019 Official Han sard Report
Bermuda House of Assembly banked, and this might be something that assists growing entrepreneurs [to gain] access to banking services which they may not have currently. Or, from an equity participant, as I have indicated earlier, it may be someone with a microloan who is looking to do convertible debt, or looking at some other type of support structure for their business, Mr. Speaker. So those are the options that are available. This is very broad. We are making it broad for a spe-cific purpose, to allow the Bermuda Economic Deve lopment Corporation flexibility. But also there is a measure of accountability to this Honourable House insofar as the Minister responsible will be the only person who can authorise these arrangements in the end. And those persons will have to be held account-able as we typically do under the ambit of collective responsibility. So with that , Mr. Speaker, and I hope that I have answered the questions of Members. If not, I am certain that there will be more questions when we get into Committee. I move that the Bill be read a second time and committed.
The SpeakerThe SpeakerAre there any objections to that? No objections. The matter will now move to Committee. Deputy. House in Committee at 6:58 pm [Hon. Derrick V. Burgess, Sr. , Chairman] COMMITTEE ON BILL BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019
The ChairmanChairmanHonourable Members, we are now in Committee of the whole [House] for further consider ation of the Bill entitled Bermuda Economic Development Corporation Amendment Act 2019 . Prem ier, you have the floor. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move clauses 1 through 7.
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, very much, Mr. Chairman. Mr. Chairman, this Bill seeks to amend the Bermuda Economi c Development Corporation Act 1980 (the principal Act) to provide for the Corporation to enter into formal corporate arrangements, in ass ociation with other persons, for the purpose of …
Continue.
Hon. E. David Burt: Thank you, very much, Mr. Chairman. Mr. Chairman, this Bill seeks to amend the Bermuda Economi c Development Corporation Act 1980 (the principal Act) to provide for the Corporation to enter into formal corporate arrangements, in ass ociation with other persons, for the purpose of providing assistance to those persons in the development of a new busin ess or a new undertaking. The Bill also enables the Bermuda Economic Development Corporation to form public/private par tnerships, creating companies or LLCs, or commercial venture projects to assist entrepreneurs. Clause 1 is self -explanatory. This is the cit ation of the Bill. Clause 2 amends section 2 (Interpretation) by inserting definitions for local company, local LLC and undertaking. The definition of “local company” is taken from the Companies Act 1981; the definition of “local LLC” is taken from the Limited Liability Company Act 2016, and the definition of an “undertaking” is taken from the Economic Development Act 1968. Clause 3 amends section 4 (Functions of the Corporation) by amending the list of functions to i nclude assisting persons in the de velopment of a new business or a new undertaking by entering into formal corporate arrangements in association with those persons. This expands the remit of the BEDC providing the scope of the Corporation to assist in developing new local enterprises or pr ojects through formal corporate arrangements. Clause 4 amends section 5 (Powers of the Corporation) by amending the list of powers to include the power to enter into formal corporate arrangements in association with other persons. This provides the Autho rity for the BEDC to enter into public/private partnerships in creating companies or commercial venture projects approved by the Government. Clause 5 inserts section 13A (Power with r espect to companies and LLCs) which sets out the manner in which the Cor poration is to exercise its powers when entering into formal corporate arrange-ments in association with other persons , and for bringing its involvement in those arrangements to an end. This allows the BEDC on its terms with the Minister’s written approval to purchase shares and be appointed a director or chief executive of a local company, to be a member and be appointed a manager of the local LLC, to incorporate a local company or to form a local LLC. This also allows the BEDC with the Minister’s written a pproval to divest itself of all shares of the l ocal company or resign its membership in a local LLC where its purposes have been fulfilled, or for any reason. Clause 6 amends section 22 (Offences) to provide for it to be an offence for a person to enter into a formal corporate arrangement with the Corpor ation fraudulently or dishonestly. This expands the offences to include any fraud or dishonesty in the crea-tion of a local company, local LLCs, or commercial venture project with the BEDC. Clause 7 provides for this Act to come into operation by notice published in the Gazette , which will be done by the Minister responsible. Thank you, Mr. Chairman.
The ChairmanChairmanThe Chair recognises the Honourable Member, Pat Gordon- Pamplin. Bermuda House of Assembly Hon. Patricia J. Gordon -Pamp lin: Thank you, Mr. Chairman. I would like to refer to clause 5, which inserts section 13A into the principal Act. During the debate of the whole [House, ] we actually had …
The Chair recognises the Honourable Member, Pat Gordon- Pamplin.
Bermuda House of Assembly Hon. Patricia J. Gordon -Pamp lin: Thank you, Mr. Chairman. I would like to refer to clause 5, which inserts section 13A into the principal Act. During the debate of the whole [House, ] we actually had the Premier, by way of explanation, indicate that the Corporation could conceivable form wholly owned subsidiaries and it is under that guise that they would be appointed as director and the chief executive officer of the company. Now, what I would like to do is go to clause 5, [new section 13A] subsection (3), where it says, “Where the Corporation —(a) purchases shares in a local company under subsection (2)(a) or incorporates a company under [subsection] 2(c), it shall . . . be appointed a director and the chief executive of the company.” Now, under [new section 13A] (2)(a) it effectively says that if the Corporation purchases shares in a local company that is registered under the Companies Act . . . so, those purchases of shares registered under the Companies Act does not suggest necessar ily that the Corporation will be purchasing all th e shares. So, it will not be able to say that this will be a wholly owned subsidiary. So the question begs, as I asked during the regular debate, at what point in time . . . why is it appropriate that the Corporation should become the CEO, the chief execut ive, of the company under [new section 13A] (3)(a) if the Corporation does not own all of the shares of the company? It would seem to me that the entrepreneur being the one driving the type of business in which he might be interested would be the more appropriate person to be the CEO, as opposed to having the Corporation take on that role. So, I am just wondering, because the premise of having a wholly owned subsidiary , as the Premier alluded to, would be that the Corporation owns all the shares. So, whet her they are majority or minority shareholder there is still, if they owned more shares than somebody else, like over 51, 50 per cent plus 1 of the shares, they would be a majority shareholder. And as a majority shareholder maybe they might be in a situati on in which they could take on the chief executive of the company. But if there is a minority shar eholding, or if there is any other shareholding, if the Corporation has not purchased a majority of the shares, I am not sure that it is appropriate for the C orporation to become the chief executive of a company. So, I hope I have clarified my question. The other issue that I did question is , again , in clause 5, [new section 13A] (4), where it speaks about the divestiture by the Corporation of shares in a local company , or if it should resign its membership in a local LLC . The question is, What is the basis for the evaluation of the value at which the Corporation will exit that company? Will it divest based on the amount of money that it put in in the first inst ance? Or will it look for some kind of a growth for that public fund to say, I lent you 100, you have had it for three or four years, you’ve made 1,000 . . . is my divestiture going to have a part of that appreciation of the value? Bas ically, you look at book value or at some level of equity. Will that be determined at a cost, or will it be on a market value? In other words, is it going to be an equity value of the company? And the other question I have is when the Corporation is becoming a director, are there any fees to be paid to the director for providing that service? And would there be D&O [ directors and officers liabi lity] insurance that would be provided by the Corpor ation for the entity to ensure that any challenges that might come under claims and personal liability with respect to D&O, that they are taken care of. The Premier also mentioned, and this is under clause 3 with the power to purchase, to incorporate a local company. This is . . . I am sorry, clause 5, [ new section] 13A (2)(c) “to incorp orate a local company under the Companies Act . . . .” We did hear that if an entrepreneur approached the Corporation, then that entrepreneur will have the ability to have that discus-sion with the Corporation to say, I need “X” amount of money to do this p articular project. That is understood. But under what premise will the Corporation decide that they are going to incorporate a local company, which then would foot the criteria of having a wholly owned subsidiary? But under what criteria would they make that determination? Will they say that there is a need in this particular area? Or would they make the determination that they have had interest being expressed, and as a result of that interest, and for shared resources, it might then be expedient to incorporate a local company? So, I am just wondering if the Premier can answer those questions. I would be appreciative. Thank you.
The ChairmanChairmanAny further questions on [ clause] 5? Hon. E. David Burt: Mr. Chairman, if I may? On clause 5 —
The ChairmanChairmanJust one second, Premier. Any further questions on clause 5? Let us complete that first. Hon. E. David Burt: Mr. Chairman, if I may, it is an important point on clause 5.
The ChairmanChairmanYou want . . . Okay. Go ahead. Hon. E. David Burt: Thank you very much. Mr. Chairman, the Honourable Member has pointed out something that is incorrect in the Bill, and I appreciate her attention to that. I have no idea how that got past our scope. But an …
You want . . . Okay. Go ahead. Hon. E. David Burt: Thank you very much. Mr. Chairman, the Honourable Member has pointed out something that is incorrect in the Bill, and I appreciate her attention to that. I have no idea how that got past our scope. But an amendment is being prepared, Mr. Chairman, on clause 5. And the claus e 5, under [proposed section 13A (3)(a)] and under 13A (3)(b), the [word] 1922 21 June 2019 Official Han sard Report
Bermuda House of Assembly “shall” will be changed to “may.” And that amendment is currently being prepared by the representative from the Attorney General’s Chambers. So, I just want to make that clear before there was any further comment. And I am happy to answer any further questions on clause 5.
The ChairmanChairmanOkay. Hon. Patricia J. Gordon -Pamplin: Thank you.
Mr. N. H. Cole SimonsClause 5, item [ new section 13A] (4), the divestiture of the shares in a local company. Can the Minister confirm the process whereby the divestiture will be authorised? Will there be a corporate resolution to support it at the BEDC level or at the corporate level? Will it be …
Clause 5, item [ new section 13A] (4), the divestiture of the shares in a local company. Can the Minister confirm the process whereby the divestiture will be authorised? Will there be a corporate resolution to support it at the BEDC level or at the corporate level? Will it be limited? Wi ll the divest iture be approved by the board members? And will you have to have the approval of the Registrar of Compa-nies to divest the BEDC shareholding? That is my question on clause 5. So, basically, I am asking—
The ChairmanChairmanClause 5, [new section 13A] (4).
Mr. N. H. Cole SimonsClause 5, [new section 13A] (4). So, basically, I am questioning the process of approvals before a divestiture takes place in the resol ution. The other question is on [clause 3, new section 4(1)] “(aa) to assist persons in the development of a new business or a new undertaking by …
Clause 5, [new section 13A] (4). So, basically, I am questioning the process of approvals before a divestiture takes place in the resol ution. The other question is on [clause 3, new section 4(1)] “(aa) to assist persons in the development of a new business or a new undertaking by means of formal corporate arrangements . . . .” My question is this: Who actually provides the instrument for the corporate arrangement? Will a legal firm be required to draw up the corporate instr ument to support the corporate arrangement? And who will pay for it? Will the BEDC pay for it? Will the entrepreneur pay for it? Or will it be split between the two? This instrument is very, very important because the instrument, I suspect, will have to b e filed with the Registrar of Companies. And if there were any banking issues, the banking would like to see an official instrument that will confirm the structure and operations of the corporate arrangement. So, if you could provide some more details on w ho will craft the instrument, who will agree on the instrument and who will pay for the instrument so that it forms a part of the corporate documents for that particular company.
The ChairmanChairmanMember Gordon- Pamplin. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, the Premier’s interjection just now with respect to the wording which needs to be amended . . . and I accept that, and I appreciate that, but if we are going to change the “purchase shares …
Member Gordon- Pamplin.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. Mr. Chairman, the Premier’s interjection just now with respect to the wording which needs to be amended . . . and I accept that, and I appreciate that, but if we are going to change the “purchase shares in a local company” (and this is under clause 5, [new section 13A] subsection (3)) —
The ChairmanChairmanOkay. Hon. Patricia J. Gordon -Pamplin: —where he said that they may be appointed a director and the chief executive officer . . . it would seem to me that it would be more appropriate for t hat to be “and/or,” or just “or the chief . . . .” …
Okay.
Hon. Patricia J. Gordon -Pamplin: —where he said that they may be appointed a director and the chief executive officer . . . it would seem to me that it would be more appropriate for t hat to be “and/or,” or just “or the chief . . . .” You know, “and/or.” So, in other words, if the Corporation does not own 100 per cent of the company, of the shares of the company, then it may not be appropriate for them to be appointed as a director or c hief executive officer. I believe it should not be . . . because the way it reads now, it says, it may be appointed a director and the chief executive of the company . But I believe it should be “and/or.” So, it would be one or the other, or both. So, that gives that flexibility. And I wonder if the Premier could have a look at that amendment and make the determination if that is appropriate. The other question that he did not answer as yet was with respect to the value at the point of dives titure. Was it g oing to be a book value, market value, cost? How are they going to determine what the Corporation will get back at the point at which they divest themselves of any shares in the company?
The ChairmanChairmanAny further speakers? Mr. Premier. I am sorry. Mr. P earman . . . Okay. Hon. E. David Burt: Thank you, Mr. Chairman. I will try to answer the questions while the drafter is preparing the amendment on clause 5. There is a question from the Honourable Member from constituency …
Any further speakers? Mr. Premier. I am sorry. Mr. P earman . . . Okay.
Hon. E. David Burt: Thank you, Mr. Chairman. I will try to answer the questions while the drafter is preparing the amendment on clause 5. There is a question from the Honourable Member from constituency 23 how does the Gover nment or t he Corporation determine whether or not there is a wholly owned subsidiary that is necessary and needed? And what are the different things? One example you gave with the shared resources may be a possibility if that is determined as the best way to go. The BEDC will have flexibility. But I think also, in my closing comments in the general debate, I also stated, for instance, there may be a property that is seeking renovation that the BEDC may find it wants to do it, and to find it as a method to set up a s eparate structure in order to raise capital for participation into that type of particular thing. So, those are the options that we are talking about. It just allows the BEDC flexibility in doing things. Right now, the BEDC cannot technically own a propert y and other things, but it may want to find itself, in doing business in the Economic Empowerment Zones, may want to form a subsidiary company for vendor markets in order to have a separate structure for there that it can actually have its own separate thing.
Bermuda House of Assembly So, those were the types of options allowing the BEDC to have that level of flexibility inside of its affairs. There was a question as to how will the value be assessed? It has been a while since I have done finance, so I do not want to get myself in to talking about the capital asset pricing model and other certain things. But it would be in the standard form of which these things are assessed normally. So, it might be book value. It depends on the circumstances that pr esent themselves. And, of course, the entrepreneur or the business and the board will have a view of those particular things. There was a question from the Honourable Member from constituency 28 [sic] regarding the —
An Hon. Member An Hon. MemberEight. Hon. E. David Burt: Constituency 8. Sorry. Sor ry, Dennis. Question from [the Honourable Member from] constituency 8 questioning the processes that would be followed, whether they be a board resolution or others. And what I would say is the proper processes, which are necessary under the Companies Act …
Eight. Hon. E. David Burt: Constituency 8. Sorry. Sor ry, Dennis. Question from [the Honourable Member from] constituency 8 questioning the processes that would be followed, whether they be a board resolution or others. And what I would say is the proper processes, which are necessary under the Companies Act , in order to make sure that anything is completed, whether it be resolutions, by vote of the BEDC we have to r emember that decisions which are made by the BEDC are made by the Board of Directors of the BEDC. So, the board will make those types of decision, and those particular items will be reflected in the minutes. And they would be filed with the Registrar of Companies if they are necessary to do so, as you understand that this will fall under all and any and all requirements underneath the Companies Act or the LLC Act. There was a question regarding legal services that would be provided. In this particular instance, the legal services may be provided internally or they may be provided externally. I know in the instance of where the Bermuda Housing Corporation formed a subsidiary corporation and joint venture for the Bermudiana Beach project, those services were provided internally by, I believe, the Attorney General’s Chambers. So, it all depends on whether or not it is done internally and/or externally and whether the items are shared. It is not specific, and we are not spelling that out. But if there is a need for those services, which particularly there will have to be in order to formalise them, they may be provided internally at expense to the Gover nment, or they may be provided externally if that is needed. And I guess, the actions may be handled by the entrepreneur in its entirety or handled by the com-pany, and it will be handled by the split of what exists.
Ms. Gordon- Pamplin.
Hon. Patricia J. Gordon -PamplinYes. I appreciate that the Premier says it has been a while since he has done the accounting side of things, but I have to declare my interest in that that is my world. And that is the area— [Inaudible i nterjection] Hon. Patricia J. Gordon -Pamplin: Finance. That is …
Yes. I appreciate that the Premier says it has been a while since he has done the accounting side of things, but I have to declare my interest in that that is my world. And that is the area—
[Inaudible i nterjection]
Hon. Patricia J. Gordon -Pamplin: Finance. That is the area in which I am really most comfortable. So, my question is, Is it the intention of the Corporation to, hopefully, grow such that the Corpor ation can get some profits out of the environment so that there is money to be able to put back into the sy stem? How they value it, I can understand that that will be determined at the time. But what would be the pr ocess if this new venture does not succeed? So, in other words, there is likely to be some kind of . . . there would have to be authority to write off any ba lances or any value where there has been a diminution in value. So, there would have to be some kind of authority. And I am just wondering how that would be handled, how the Corporati on will handle such [things] in terms of the authority to write off any irrecoverable balances.
Hon. E. David Burt: Thank you, Mr. Chairman. That authority exists currently right now to do that from the [Bermuda] Economic Development Corporation. They do take losses. I mean, and that is the business which they are in. So, there are some times that guarantees will come due. They will then, under the guarantee arrangements, have to go after possible assets. The assets may not be there; they have to take those losses. I mean, that is what happens. But this is the whole purpose of organisations like this. And entrepreneurs . . . not everyone is going to win. But you want to have more winners than you have losers to ensure that those businesses can survive. Bu t whether it is the BEDC here, whether it is the Small Business Administration in the United States, whether it is the organisation in other countries, the provision is recognised that there will be some losses in this particular instance. I think the BED C has an excellent track record of managing those particular items, as has been seen with the microloan programme. Out of 43, only 1 has been called. They are very good at making sure they assess the risk in advance. But, you know, there are economic condi tions. There are many different things that may happen. But to answer the original question of whether or not the intent is for these items to be profitable, a bsolutely the intent is for the items to be profitable. And if, say, for instance, we are going with a shared services venture, talking about a screen printing and having, you know . . . because one of the things that the BEDC has spoken about would be, you know, the entrepreneur’s house where they have these things. For instance, they have them in Miami, where they have 1924 21 June 2019 Official Han sard Report
Bermuda House of Assembly these spaces where there are various entrepreneurs, who are there using shared services. They are sharing in the purchasing of particular assets and all the rest. If you have a screen printing operation and you are doing this and all the rest, and you are char ging for the use of that machine for the time that it is [being used], and then those items are done. And maybe someone wants to buy out the BEDC’s portion to take a bigger piece of that or buy it outright. Those things can be valued in the regular way in which co mpanies are valued. And I think this entrepreneur would understand and accept that. And it is part of growing financial literacy in Bermuda. It is not just debt financing, but equity financing and how you value equity financing when things are set to grow and when things are delivering standard returns over a period of time.
The ChairmanChairmanThe Honourable Member Pearman.
Mr. Scott PearmanI tried to sit down. Thank you, Mr. Chairman. My question is also on this same subs ection that we have been looking at, which is clause 5 of the Bill at page 2, which inserts section 13A. And I am looking at 13A (3)(a), which is the subsection, I …
I tried to sit down. Thank you, Mr. Chairman. My question is also on this same subs ection that we have been looking at, which is clause 5 of the Bill at page 2, which inserts section 13A. And I am looking at 13A (3)(a), which is the subsection, I think, that the Honourable Premier indicated, Mr. Chairman, was being in consideration for an amendment in a moment. May I just add this. I know we had a bit of a kerfuffle today on amending Bills. But this is offered in the right spirit.
[Inaudible interjection]
Mr. Scott PearmanIf “shall” is to be amended to “may,” may I also just point ou t that 13A (3)(a) says this: “Where the Corporation” (which is the BEDC) “(a) purchases shares . . .” et cetera, incorporates, et cetera, “it shall” (or now “may”) . . . “It”, of course, is …
If “shall” is to be amended to “may,” may I also just point ou t that 13A (3)(a) says this: “Where the Corporation” (which is the BEDC) “(a) purchases shares . . .” et cetera, incorporates, et cetera, “it shall” (or now “may”) . . . “It”, of course, is the BEDC, which is a corporation. I have looked at the definition of the Corporation in the main Act. A corporation cannot serve as a director or, indeed, as a chief executive officer. A person has to. So, presumably, that should be not “it,” but “a member of the board of the BEDC,” or similar or something of that nature, b ecause it cannot be the Corporation itself; it would be impermissible.
The ChairmanChairmanAny further speakers? The Honourable Member Hadley Cole S imons.
Mr. N. H. Cole SimonsYes. Clause 5, [new section 13A (3)], Where the Corporation (a) purchases shar es . . .” Can the Premier help me with this? Are we going to invest —
The ChairmanChairmanPut your microphone on, Cole. Mr. N. H. Cole Simons: Are we going to invest an equity position in a company because we want to help that entrepreneur succeed and provide t hem with seed capital to succeed? Or are we investing in the company because we see a real …
Put your microphone on, Cole. Mr. N. H. Cole Simons: Are we going to invest an equity position in a company because we want to help that entrepreneur succeed and provide t hem with seed capital to succeed? Or are we investing in the company because we see a real investment oppor-tunity from a speculative point of view? So, my question is twofold. Will the BEDC look for investment opportunities? Or is there a man-date to provi de equity capital for entrepreneurs to make their business succeed and not necessarily looking for investment opportunities from an inves tment point of view?
The ChairmanChairmanMs. Gordon- Pamplin. Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. While the Premier is getting the answer to the other, my final question is that I did ask about D&O insurance. And I did not get a reply to that yet. So, I wonder if the Premier could …
Ms. Gordon- Pamplin.
Hon. Patricia J. Gordon -Pamplin: Thank you, Mr. Chairman. While the Premier is getting the answer to the other, my final question is that I did ask about D&O insurance. And I did not get a reply to that yet. So, I wonder if the Premier could let me know. Is there going to be directors and officers liability insuranc e?
[Inaudible interjection]
Hon. Patricia J. Gordon -Pamplin: Oh, I am sorry. I did not hear the response to that. Okay. Sorry. I did not hear that.
Mr. Premier.
Hon. E. David BurtpremierFor clarity for the Honourable Member . . . for clarity, I did say that any arrang ements which are necessary and proper, whether they be directors and officers insurance or other things, to make sure that the interests of the BEDC are protec ted will be in place. And …
For clarity for the Honourable Member . . . for clarity, I did say that any arrang ements which are necessary and proper, whether they be directors and officers insurance or other things, to make sure that the interests of the BEDC are protec ted will be in place. And I did . . . but I will be very sp ecific and answer the question there. In regard to the question from the Honourable Member, the BEDC is not going out to seek . . . just to be clear.
[Inaudible interjection]
Hon. E. David Burt: Yes. Yes. The BEDC is not going out to seek. This is not all of a sudden the BEDC is going to look for companies to start buying up and running. And it is not the purpose of this in any way, shape or form. I think that we have a market that is relatively robust. And there are lots of different things. However , there may be entrepreneurs who are looking to get started up. There may be persons through different things. There may be, as I said, from a shared services model, a cooperative model or other types of particular instances.
The ChairmanChairmanAny further speakers? Bermuda House of Assembly The Chair recognises the Honourable Member Ms. Atherden. Hon. Jeanne J. Atherden: Sorry, Mr. Chairman. I did not think that the Premier had answered the question with respect to the corporate element in terms of whether the Corporation could be a director and …
Any further speakers?
Bermuda House of Assembly The Chair recognises the Honourable Member Ms. Atherden.
Hon. Jeanne J. Atherden: Sorry, Mr. Chairman. I did not think that the Premier had answered the question with respect to the corporate element in terms of whether the Corporation could be a director and a chief executive officer, whether a corporation could be that. If he could do that for me, please.
The ChairmanChairmanPremier. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, the drafter and those items, I do believe that it satisfies the law. I am happy for the Honourable Member who is no longer in his seat —
The ChairmanChairmanHe is right here. Hon. E. David Burt: —to signify any particular place and area where that is contrary to the Companies Act. I know there are persons here, but I just want to make sure it is specific. Because the information which we have is that it should be …
Mr. Scott Pearman—the point came up again. The point is this, is that obviously the concept of a c hief executive officer or the concept of the director is someone who owes duties to a company. And that task is performed by an individual . The idea that you would have a …
—the point came up again. The point is this, is that obviously the concept of a c hief executive officer or the concept of the director is someone who owes duties to a company. And that task is performed by an individual . The idea that you would have a corporation as a chief executive officer of a company is a bit nonsensical. I mean, if that is what Government wants to achieve by this Bill, fine. But —
[Inaudible interjection]
Mr. Scott PearmanNo, respectfully, it does not. But again, it was offered in the spirit of i mproving the legislation —legislation which we support and commend. The Chairman: Thank you, Mr. Pearman. Any further speakers?
Mr. Premier.
Hon. E. David BurtpremierThank you very much, Mr. Chairman. I thank the Honourable Member from constituency 22. I will note that the Clerk was in receipt of a written amendment that is being copied for circulation on that particular basis. And I am happy to entertain any questions or any comments on any …
The ChairmanChairmanAny further speakers? Okay. I guess we are waiting for the amendment. It is being copied presently. Just give us two minutes. [Pause]
The ChairmanChairmanPremier, do you want to move the amendment? AMENDMENT TO CLAUSE 5 Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move that clause 5 of the Bermuda Economic Development Corporation Amendment A ct be amended as follows: In clause 5, [new] section 13A (3)(a), delete “shall” and …
Premier, do you want to move the amendment?
AMENDMENT TO CLAUSE 5
Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move that clause 5 of the Bermuda Economic Development Corporation Amendment A ct be amended as follows: In clause 5, [new] section 13A (3)(a), delete “shall” and substitute “may,” and delete “and” and substitute “or.” And in [new] section 13A (3)(b), delete “shall” and substitute “may.”
The ChairmanChairmanDo the second one again, 13? Hon. E. David Burt: [New section] 13A (3)(b), delete “shall” and substitute “may.” The Clerk: Just 13? Is it 13? Oh.
The ChairmanChairman[New section] 13A (3)(a). Hon. E. David Burt: We are in clause 5. And it is the places where it says . . . [Inaudible int erjections ] Hon. E. David Burt: Yes. So, we have 13A (3)(a) and 13A (3)(b).
The ChairmanChairmanMs. Gordon- Pamplin. Hon. Patricia J. Gordon -Pamplin: Yes. I would just like to speak to the amendment, that we are deleting the . . . this is in clause 5, [new] section 13A (3)(a), where the last part of that in which we are deleting “and” and substituting “or.” …
Ms. Gordon- Pamplin. Hon. Patricia J. Gordon -Pamplin: Yes. I would just like to speak to the amendment, that we are deleting the . . . this is in clause 5, [new] section 13A (3)(a), where the last part of that in which we are deleting “and” and substituting “or.” It still does not quite get us 1926 21 June 2019 Official Han sard Report
Bermuda House of Assembly to where we want to be, because this is saying that the Corporation may be— may be—appointed a director “or” the chief executive officer. But could they not be both?
The ChairmanChairmanAnd/or. Hon. Patricia J. Gordon -Pamplin: Could it not — should it not be “and/or”? I am just curious. Hon. E. David Burt: I am certain that the drafter spoke, and I am not going t o take extra . . . those are drafters who know far better than …
And/or.
Hon. Patricia J. Gordon -Pamplin: Could it not — should it not be “and/or”? I am just curious.
Hon. E. David Burt: I am certain that the drafter spoke, and I am not going t o take extra . . . those are drafters who know far better than me on the implic ations.
Hon. Patricia J. Gordon -Pamplin: Yes. No, I am just wondering. Hon. E. David Burt: And so, from the “or,” I am assuming that they have the power to be both. Hon. Patr icia J. Gordon -Pamplin: Okay. All right. Okay. Thank you.
Mr. Premier.
Hon. E. David BurtpremierThank you, Mr. Chairman. I appreciate the contributions of Members on this, and I move that the clause 5 be amended as submitt ed. I move the amendment.
The ChairmanChairmanIt has been moved that clause 5 be approved as amended. Are there any objections to that? There appear to be none. Approved. [Motion carried: Clause 5 passed with amendment.] Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I will then move that clauses 1, 2, 3, 4, …
It has been moved that clause 5 be approved as amended. Are there any objections to that? There appear to be none. Approved.
[Motion carried: Clause 5 passed with amendment.]
Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I will then move that clauses 1, 2, 3, 4, 6 and 7 be approved and stand part of the Bill.
The ChairmanChairmanIt has been moved that clauses 1, 3, 4, 6 and 7 be approved. Hon. E. David Burt: Mr. Speaker, just for clarity, clauses, 1, 2, 3, 4, 6 and 7.
The ChairmanChairmanYes. It has been moved that clauses 1, 2, 3, 4, 6 and 7 be approved. Are there any objections to that? No objections. Approved. [Motion carried: Clauses 1, 2, 3, 4, 6 and 7 passed.] Hon. E. David Burt: Thank you very much, Mr. Chairman. Mr. Chairman, I move …
The ChairmanChairmanIt has been moved that the preamble be approved. Any objection to that? There appear to be none. Approved. Hon. E. David Burt: Thank you, Mr. Chairman. I move that t he Bill be reported to the House as amended.
The ChairmanChairmanIt has been moved that the Bill be reported to the House as amended. Any objections to that? There appear to be none. Approved. The Bill will be reported to the House as amended. [Motion carr ied: The Bermuda Economic Development Corporation Amendment Act 2019 was considered by a Committee …
It has been moved that the Bill be reported to the House as amended. Any objections to that? There appear to be none. Approved. The Bill will be reported to the House as amended.
[Motion carr ied: The Bermuda Economic Development Corporation Amendment Act 2019 was considered by a Committee of the whole House and passed as amended.]
House resumed at 7:30 pm
[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]
REPORT OF COMMITTEE
BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019
The SpeakerThe SpeakerGood evening, Members. Is there any objection to the Bill, the Bermuda Economic Development Corporation Amendment Act 2019, being reported to the House with the amendment, as amended? No objections. It has been done.
The SpeakerThe SpeakerThat now brings us to the third readings today. Minister of Finance. SUSPENSION OF STANDING ORDER 21 Hon. Curtis L. Dickinson: Mr. Speaker, I move that Standing Order 21 be suspended to enable me to move that the Bill entitled Government Loans Amendment Act 2019 be now read the third …
The SpeakerThe SpeakerAny objections? None. Continue. B ermuda House of Assembly [Motion carried: Standing Order 21 suspended.] BILL THIRD READING GOVERNMENT LOANS AMENDMENT ACT 2019 Hon. Curtis L. Dickinson: I move that the Bill be now read a third time by its title only and passed.
The SpeakerThe SpeakerIt has been done. [ Motion carried: The Government Loans Amendment Act 2019 was read a third time and passed.]
The SpeakerThe SpeakerThe second one. Do your second [third] reading. SUSPENSION OF STANDING ORDER 21 Hon. Curtis L. Dickinson: Mr. Speaker, I move that Standing Order 21 be suspended to enable me to move that the Bill entitled the Economic Substance Amendment Act 2019 be now read the third time by its …
The SpeakerThe SpeakerAny objections? There are none. Continue. [ Motion carried: Standing Order 21 suspended.] BILL THIRD READING ECONOMIC SUBSTANCE AMENDMENT ACT 2019 Hon. Curtis L. Dickinson: I move that the Bill now be read time a third time by its title only and passed.
The SpeakerThe SpeakerYes. [ Motion carried: The Economic Substance Amen dment Act 2019 was read a third time and passed.]
The SpeakerThe SpeakerDeputy Premier, would you like to move yours, do your third reading? SUSPENSION OF STANDIN G ORDER 21 Hon. Walter H. Roban: Yes. Thank you, Mr. Speaker. I move that Standing Order 21 be suspended to enable me to move that the Bill entitled the Elec-tricity Amendment Act 2019 be …
The SpeakerThe SpeakerAny object ions? No. Please do so. [ Motion carried: Standing Order 21 suspended.] BILL THIRD READING ELECTRICITY AMENDMENT ACT Hon. Walter H. Roban: I move that the Bill be now read a third time by its title only and passed.
The SpeakerThe SpeakerIt has been moved and passed. [ Motion carried: The Electricity Amendment Act 2019 was read a third time and passed.]
The SpeakerThe SpeakerPremier. SUSPENSION OF STANDING ORDER 21 Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I move that Standing Order 21 be suspended to enable me to move that the Bill ent itled the Bermuda Economic Development Corporation Amendment Act 2019 be now read the third time by its …
The SpeakerThe SpeakerAny objections? No objections. Continue on. [ Motion carried: Standing Order 21 suspended. ] BILL THIRD READING BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019 Hon. E. David Burt: Thank you very much, Mr. Speaker. Mr. Speaker, I move that the Bill entitled the Bermuda Economic Development Corporation Amendment Act 2019 …
Any objections? No objections. Continue on. [ Motion carried: Standing Order 21 suspended. ] BILL THIRD READING BERMUDA ECONOMIC DEVELOPMENT CORPORATION AMENDMENT ACT 2019 Hon. E. David Burt: Thank you very much, Mr. Speaker. Mr. Speaker, I move that the Bill entitled the Bermuda Economic Development Corporation Amendment Act 2019 be now read a third time by its title only and passed.
The SpeakerThe SpeakerIt has. And now it is passed. [ Motion carried; The Bermuda Economic Development Corporation Amendment Act 2019 was read a third time and passed.]
The SpeakerThe SpeakerPremier, stay on your feet. That br ings us to the end of this day. 1928 21 June 2019 Official Han sard Report Bermuda House of Assembly ADJOURNMENT Hon. E. David Burt: Thank you very much, Mr. Speaker. Mr. Speaker, I move that this Honourable House do now adjourn until …
An Hon. Member An Hon. MemberJuly 5th? Hon. E. David Burt: July 5 th.
The SpeakerThe SpeakerThank you, Mr. Premier. Does any Member . . . Whip, are you standing for a particular reason?
The SpeakerThe SpeakerWould anyone like to speak to that m otion? [Laughter] FACEBOOK LIBRA CRYPTOCURRENCY AND BERMUDA
Mr. W. Lawrence ScottI was hoping to be able to speak to the motion to adjourn, Mr. Speaker. Yes, Mr. Speaker. In 1775 —
The SpeakerThe SpeakerYou remember that? [Inaudible interjections]
Mr. W. Lawrence ScottYes, very clearly. In 1775, Mr. S peaker, the United States Marine Corps performed their first amphibious assault, which was in The Bahamas. And this was to be able to help supply them for gunpowder and weapons for their Revolutionary, or their War of Independence. They were successful wit h …
Yes, very clearly. In 1775, Mr. S peaker, the United States Marine Corps performed their first amphibious assault, which was in The Bahamas. And this was to be able to help supply them for gunpowder and weapons for their Revolutionary, or their War of Independence. They were successful wit h their raid in Nassau, B ahamas. And so, what they then did was then go out and look for another British Overseas Territory that would be not too far from the United States mainland and could possibly have gunpowder for them to use for their ships. They f ound such a place. And that place was 750 miles off of the Carolinas, namely, being Berm uda. They came and then were successful with another amphibious assault. And thus, after they were successful, we then ended up talking to them and saying, Hey, you know what? We don’t really like the British that much anyway. All you had to do was ask, and we would help you out in the long run. Now, I bring that up because one of the Marine Corps’ mottos is, Improvise, adapt and overcome. And that ties into what I am t alking about, because where we are with our economy, meaning that financial services, insurance, we cannot continue to be r e-active. We have to be proactive. And one thing that you will notice is that . . . and the reason that this is coming up now, is that if you would notice that this week, a popular website, a popular service that all of us use in some way, shape or form in this House, this Chamber, this Island, Facebook, is planning on launching a cryptocurrency named Libra. And I hear Members asking, W hat is crypt ocurrency? Cryptocurrency is actually a form of FinTech, or financial technology. And so, therefore, when you talk about Facebook going into cryptocur-rencies, I know that the Bermuda people have been hearing about cryptocurrencies, and it has b een dri ven by basically the same party for the last, I would say, four to five years. If you want to go back in history four or five years to 2014, I think the first time that it was officially mentioned as part of the PLP platform was under former Opposit ion Leader Marc Bean in the Reply to the 2014 Throne Speech. And so, now that we have had these visionaries who . . . now, the current leader, the current Premier has been utilising and taking advantage of the par-ty’s current platform, or current medium, which has been the Government, to be able to push FinTech, to be able to push the vision that we need to be a major player in the FinTech, in the cryptocurrency, in the blockchain spectrum. Now, although this has come with huge pushback from the then Government in 2014, who did not do anything to advance the cryptocurrency/blockchain/FinTech industry here in Bermuda, to the now current Opposition, who (I will say, to put it politely) provides even more pushback, even more (I will say) animosity towards cry ptocurrencies and blockchains. But yet . . . and they have called it the bogeyman. They —
Hon. L. Craig Cannonier: Point of order, Mr. Speaker.
The SpeakerThe SpeakerWe will take your point of order. POINT OF ORDER Hon. L. Craig Cannonier: Yes. The Honourable Member has a tendency to generalise. We have been supportive and have said over and over in this House that we support the industry. There have been hiccups within the industry that we …
We will take your point of order.
POINT OF ORDER
Hon. L. Craig Cannonier: Yes. The Honourable Member has a tendency to generalise. We have been supportive and have said over and over in this House that we support the industry. There have been hiccups within the industry that we have spoken to that are of concern to the people of Bermuda. But we have said categorically that we support FinTech! He needs to get it sorted!
Mr. W. Lawrence ScottYes. And, Mr. Speaker, this is coming from the same party who said that they supported legislation Bermuda House of Assembly earlier today, but then had Members speak against it. So— Hon. Patricia J. Gordon -Pamplin: A point of order, Mr. Speaker. [Inaudible interjections ]
The SpeakerThe SpeakerAh! Ah! Ah! POINT OF ORDER Hon. Patricia J. Gordon -Pamplin: Point of order, Mr. Speaker. I just believe that that statement cannot go unchallenged. [Inaudible interjections ]
The SpeakerThe SpeakerYou jumped too quick. You jumped too quick. Hon. Patricia J. Gordon -Pamplin: Thank you, sir.
The SpeakerThe Speaker[Member], just stay on track with where you need to go and do not get caught with t hese little side turns because they take you to the wrong spot. [Laughter]
The SpeakerThe SpeakerJust stay where you are going and you will be okay. Do not be sidetracked.
Mr. W. Lawrence ScottOkay, Mr. Speaker. I will be guided by you, Mr. Speaker. But going back to the Facebook Libra and how it is being released today. Now, the thing is that if Facebook has been working on this for the last year and the PLP Government has been talking about this …
Okay, Mr. Speaker. I will be guided by you, Mr. Speaker. But going back to the Facebook Libra and how it is being released today. Now, the thing is that if Facebook has been working on this for the last year and the PLP Government has been talking about this for two years, this puts us ahead of the curve not just for Fac ebook, but ahead of the curve, I will say, internationally in the sense that what is happening with Facebook right now, Facebook has the banking op-portunities, the banking abilities. But they are having trouble with the regulatory side of things. And now, what we have been doing for the last two years has been putting a regulatory framework together. So, now the vision of the two former . . . the vision of the former Leader and current Leader of the PLP has now put this country in a position to possibly take advantage of something of a budding industry, a budding niche in the financial services, where there could be an exchange of information, there could be an exchange of services given. So, Mr. Speaker, what I want people to understand is that we continue, while others are out there and they are more guided by the traditional model of the country, Quo Fata Ferunt , (where the fates may carry us,) which puts you in a reactive position almost every time. Maybe the fact that we can use this current administ ration, we can use this current situation, where Facebook . . . and the United States Congress has gone to Facebook and said, Can you delay the launch of your cryptocurrency? Because we need to figure out how to regulate it. Where here in Bermuda, we have already got the regulation taken care of. We already have a framework for them to move where an industry, a niche, a financial service product like that could move forward.
Mr. W. Lawrence ScottAnd as the Member Co mmissiong says, “pioneering,” this could be a significant revenue generator for the country. I am not saying that this is what is going to happen. I hope it does. I hope it does. But I want to be very cautious. I want to be cautiously …
And as the Member Co mmissiong says, “pioneering,” this could be a significant revenue generator for the country. I am not saying that this is what is going to happen. I hope it does. I hope it does. But I want to be very cautious. I want to be cautiously optimistic in where I go and to set reali stic expectations for the Bermuda people. And the thing is that the Opposition Leader —
The SpeakerThe SpeakerYou are getting a little off there.
Mr. W. Lawrence ScottThe Opposition Leader just got up and mentioned that they support FinTech, but yet, they do their constitutional duty. [Inaudible interjections]
Mr. W. Lawrence ScottNo, no. I am working with you. I am working with you, Opposition Leader. They do their constitutional duty as the loyal Opposition to highlight perceived challen ges, perceived shortcomings and concerns. And I know that it has been said time and time again in this Honourable House that there …
No, no. I am working with you. I am working with you, Opposition Leader. They do their constitutional duty as the loyal Opposition to highlight perceived challen ges, perceived shortcomings and concerns. And I know that it has been said time and time again in this Honourable House that there are certain areas in which we have to work together. The economic substance is a prime example, where all parties can win, al l parties meaning both, not just the Government and Opposition, but the average person in Bermuda. So, what I want the average person listening to my voice right now to understand is that you are now starting to see the green shoots of the seeds that have been sown by this party, not just over the last two years, but since 2014. Even though the times got hard and we were chastised about different things, concerns were raised on different aspects, the thing is that I want people to see that not just on the football field are we punching above our weight. And it is also being translated into one of our major pillars, or our major pillar, of this economy. And when you hear the PLP talk about a d iversification of our economy, that does not mean to sacrifice an y current or existing aspects of our economy. That means to build on top of that. It means to be able to add to that. And so, therefore, when we start pushing FinTech . . . and could you imagine, Mr. Speaker, if what I say does come to fruition, where 1930 21 June 2019 Official Han sard Report
Bermuda House of Assembly Facebook does come to the Bermuda Government, to the PLP, and says, Hey. We need your help. Hey. We want to base part of our operation here in Bermuda for some reason or some shape or form. Or even say that . . . and this could be where a deal could be struck where we say, You know what? Take some our youth. Take some of our young coders, or have an internship of some sort. We just announced earlier today the scholarship with the—
An Hon. Member An Hon. MemberThat is age discrimination, man.
Mr. W. Lawrence ScottThe Honourable Member said that talking about the youth and coding is sort of age discriminatory. But I understand. But the thing is that we just mentioned about a partnership and scholarships with the Univ ersity of the West Indies. So, I want Members in this House to understand that …
The Honourable Member said that talking about the youth and coding is sort of age discriminatory. But I understand. But the thing is that we just mentioned about a partnership and scholarships with the Univ ersity of the West Indies. So, I want Members in this House to understand that there is a strategy to what we are doing. I want the public to understand that there are things that have been done, there are decisions that we have made that might not make s ense right now, that might not have made sense back in July 2017. But I can understand, and I want you to understand. I want you to really capture the fact that we are here. We are not making transactional decisions. We are making dec isions that will be tr ansformational, that will level the playing field in every aspect of Bermudian life. And what that means . . . and when you are talking about transformational, that means that there are going to some people who do not like to see their piece of the pie, t heir piece of the rock, their piece of the industry, their profit margins getting smaller. And they are going to cry out. And there are Members in this House who will represent those voices. But I want you to understand and remember that, as we level the playing field, those members whose profit margins, those members of our society whose piece of the pie, whose piece of the rock is getting smaller, understand, believe and know that this means that somebody deserving, another aspect of the community who has not had, another aspect of the community who has always been marginalised, another aspect of the community who has almost always struggled is now getting not just a handout, but a hand up. And that these members of society who have struggled all this ti me can now start to fulfil their beliefs, their dreams and their purpose. They can be-come successful and positively contributing members of this society. And as they become successful, their success is our success. And I do not say “our success” as in just the PLP. I say “our success” as ever yone, all 36 Members of this Chamber. Because, r e-member. When we fail up here, the country and the people fail out there. But when we succeed in here, when we level the playing field, when we remove roadblocks and obstacles that did not need to be there in the first place, this makes it easier for others to e nter into industry. This makes it easier for other me mbers of this community to create industry. Because, Mr. Speaker, although I am one of the younger Members . . . actually right now I am the youngest Member in this Chamber, right?
[Inaudible interjections ]
An Hon. Member An Hon. MemberYou mean right at this moment.
Mr. W. Lawrence ScottRight this moment, just this moment, just this moment. [Inaudible interjections ]
Mr. W. Lawrence ScottI am living in the moment. I am living in the moment. That is why I did not say “this House,” because I know the Members in the House. But . . . right? But the thing is that, although I am (and I will be more accurate) one of …
I am living in the moment. I am living in the moment. That is why I did not say “this House,” because I know the Members in the House. But . . . right? But the thing is that, although I am (and I will be more accurate) one of the youngest Members in this House, history is not lost on me, Mr. Speaker. I understand that there was a time when the decisions and political decisions of this country were made down at the yacht club and ratified up here in this House. There were times that there were decisions made by Members who were in this House who had glaring conflicts of interest. But those times are no more. Although the ramifications and the effects of those decisions, the effects of those actions are still being felt today, that is wha t we are here to correct. And while we are correcting that, just understand— and I am stressing this point . . . and I stress this point, I repeat it because it is so true. In this country, with the transformational governance and politics that we are prov iding, Mr. Speaker, the haves will continue to have. But the have- nots need to have more. And in doing that, that does not mean that we have to rob Peter to pay Paul. And, yes, Members are saying that I have said that before. And, yes, I purposely say it again. And, Mr. Speaker, once again for those in the back of the room who cannot hear me. The haves can continue to have, but the have- nots need to have more. And that means not just more money; that means more access to opportunity, access to r esources, access to capital, access to be able to have the quality of life that they deserve. No longer should a select few in this community control the majority. And when I say “control,” I mean economic control. I mean, why is it so hard to start a business here in Bermuda, Mr. Speaker? Why is it that we have to do so many of the things we have to do—jump through so many of the hoops? Because somebody
Bermuda House of Assembly gets paid from it. And this is what I am talking about when I say “somebody.” Remember, the majority of the laws that we are living by today and guided by today were passed, were ratified, back in a time when there were Two Bermudas, when basically those who were successful were white and those who were unsuccessful or had barriers of entry were black, Mr. Speaker. And as you can see, this society has changed significantly since then. The society has changed si gnificantly since then. The infrastructure in which soci ety is based on has not. So, therefore, there is indirec tly an institutionalised racism, Mr. Speaker, w hich means that this is where the transformational part of politics comes in. This is where Facebook Libra cry ptocurrency comes in, Mr. Speaker. Because it is for cing us to change the way we have always done bus iness. It is forcing us to make sure that there are ind ividuals who can participate in an economy, an industry that was almost off limits to them before. And the thing is, I want Members to—
The SpeakerThe SpeakerOh. [Inaudible interjections ]
The SpeakerThe SpeakerMember, I believe that time is for you. That clock is for you. I do note that no one else has risen, though. [Inaudible interjections ]
The SpeakerThe SpeakerNo one else rose, right? No one else rose. [Inaudible interjections] The S peaker: We are going home early tonight. We are going home early tonight. [Gavel] [Inaudible interjections ]
The SpeakerThe SpeakerGood evening. We will see everyone on the 5 th of July. Yes. [Inaudible interjections]
The SpeakerThe SpeakerSergeant? Sergeant is not here. [Inaudible interjections]
The SpeakerThe SpeakerNo. [At 7:54 pm, the House stood adjourned until 10:00 am, Friday, 5 July 2019.] 1932 21 June 2019 Official Han sard Report Bermuda House of Assembly [This page intentionally left blank.]