February 16, 2024

There are none.
PAPERS AND OTHER
COMMUNICATIONS TO THE HOUSE The Speaker: There is one such paper this morning.
That is in the name of the Minister of Finance.
Premier.
2
023 NATIONAL ECONOMIC REPORT
OF BERMUDA
Hon. E. David Burt: Good morning, Mr. Speaker.
Mr. Speaker, I have the honour to attach and
submit for the information of the Honourable House of Assembly the 2023 National Economic Report of Ber-muda.

Well, it is your call.
BUDGET STATEMENT IN SUPPORT OF
THE ESTIMATES OF REVENUE
AND EXPENDITURE 2024/25
INVEST ING IN OUR PEOPLE AND OUR FUTURE
Introduction
Hon. E. David Burt: Mr. Speaker, we have entered the
25th year of the 21st century. A child born in the year
2000 is likely to have voted at least once, completed
secondary and potentially tertiary education, might
have children, may be married, and has very likely considered purchasing a home. This century is theirs. The nostalgia for 20
th century days, fuelled by 20th century
thinking and yielding 20th century arguments , does not
368 16 February 2024 Official Hansard Report

Bermuda House of Assembly resonate with them and drives them to question
whether those of us in our 40s, 50s or even 60s, recognise that yesterday is gone and is not coming back.
Mr. Speaker , we run the risk of being consumed by these 20th century arguments about the
height of buildings, whether the tech sector in all its
forms is real, whether ministers eat at McDonald’s or
Ocean Prime, drive Kias or Toyotas or how we market
the Island to non- traditional tourists. While we argue
about th ose things, adopting an approach that is more
self-interest wrapped in a thin veil of fake activism, we
are forced to work twice as hard as other jurisdictions
to maintain and grow investor confidence or to incentivise foreign direct investment. We now must add to
the telling of the Bermuda story a caveat that denies we
are slaves to the 20th century and that we are fully engaged in the 21st.
Mr. Speaker , I wish for the people to know that
theirs is a 21st century Government eager to put technology to work in support of delivering public services ,
determined to provide for those Bermudians whose years of strength and vigour were spent building the society we now enjoy , committed to fostering environment s in which our people can thrive economically and
socially , and keeping communities safe as we nurture
this generation of children through a reformed education system.
Mr. Speaker , this Progressive Labour Party
Government has always been mindful of the moment
when entrusted with governing Bermuda. On the cusp of the year 2000, then- Minister of Finance, the Honourable C. Eugene Cox , set out an ethos that is as relevant
today as it was then. He said in February 1999 , “It is
expected that in this Statement I should quote averages and aggregates, means and medians, populations and percentages, and in due course I shall do
that. But while delivering broad- brush statements it is
too easy to paint over life's cracks and crevices through
which the individual falls. In extolling the above- average achievements it is too easy to ignore those who
exist below the average, who do not reach the aboveaverage household incomes, who do not have enough
to pay the average rent and who cannot afford the
above- average increases in health care costs. It is the
job of this Government to implement economic policies
that will present opportunities for all to advance and to
benefit from the economi c success of Bermuda. ”
Mr. Speaker , Mr. Cox’s comments then apply
to today’s Statement because we will set out a picture
of economic growth and success realised in Bermuda. But we do so recognising that these are not laurels on
which to rest until that success is more fully felt by the
people we serve. A key difference between us and the
Opposition , as it is constituted today or as it existed in
Mr. Cox’s day, is that the balancing of the budget is not
achieved on the backs of the people but is delivered with the people at the c entre of the success. We take
the Government’s above- average performance and
use it to invest in our people— no victory lap until the race is made fair for all , and no end to serving the people until the people enjoy the success occasioned by
their manifested trust in this Government to deliver a
fairer and better Bermuda for all .
Mr. Speaker , in this Budget we invest in infrastructure, we invest in education, we preserve access
to health care while reforming the system, we
strengthen the social safety net, we make affordable
housing a priority, we make home ownership available
to more Bermudians, we make our Island safer, and we
invest in the young people of this century through scholarshi ps and education awards. Mr. Speaker , this is no
fluke. The ability to do these things and deliver a bal-anced budget for the people of Bermuda has been
achieved through fiscal prudence, sound debt management, preserving and growing investor confidence, and
delivering on our promise to reduce the tax burden on the working families of this Island.

Addressing the Rising Cost of Living

Hon. E. David Burt: Mr. Speaker , since the height of
the pandemic , we have reduced inflation rates, grown
our economy while reducing our deficits and moved our country toward a balanced budget. Our Government
can point to many statistics to highlight our successes. We can show in so many ways , backed up with facts,
that we are taking our country's finances into a better, stronger direction. We can also point to many initiatives
that have been put in place to reduce the burdens on
Bermudians , and we can point to greater protections for
our workers in the workplace.
Mr. Speaker , what I say next will be very important to the Bermudian people. Yes, by nearly every
measurement the economy is headed in the right direction, yet we know that too many Bermudians are not
feeling the impact of it in their lives. Too many continue
to struggle with high food prices while businesses boast
about their profits. Too many face growing rental costs
and shrinking housing options. From groceries to
health care to mortgage rates, the escalation of prices
in Bermuda is causing an escalati on of financial hardship and frustration.
Mr. Speaker , in this Government we know that
the best economic statistics in the world mean little
when our people are not feeling it in their daily lives. We
know that even if other islands around the world are
experiencing similar challenges with the cost of living and housing, it is little consolation to say that things are
better here compared to other places. We also know
that these frustrations are compounded by the condition of our road infrastructure and the impact it has on
our quality of life and the condition of our vehicles. All
of this serves as a humble reminder that though we
have made significant progress , and though Bermuda
has seen lower inflation than other jurisdictions, we have not gotten everything right, more must be done
and this Government remains determined to address
these issues and improve the lives of our people.


Bermuda House of Assembly Mr. Speaker , the increase in the cost of living
is, at its core, a product of our small size, our need to
import nearly all of our goods , and the fallout from wars,
supply chain disruptions, and rising interest rates overseas.
Mr. Speaker , the rate of inflation in Bermuda
has been steadily declining over the last year , and we
are encouraged to see that it is now at 2.4 per cent.
Government policies such as the elimination of duty on
staple goods, reduction of the sugar tax, the freezing of
fuel prices, the reduction of payroll taxes for all local businesses and 86 per cent of the workers in Bermuda,
the two- year freeze o n government health insurance
premiums , the reduction in vehicle licence fees—all of
these play a part in doing what we can to slow the rising
cost of living and reduce the impact of global inflation
here at home.

Economic Review

The Global Economy

Hon. E. David Burt: Mr. Speaker , in 2023 the global
economy faced higher interest rates, tighter financial
markets, increased debt pressures on both households and businesses, a slowing of global demand and continued geopolitical conflict. The International Monetary
Fund estimates that the global economy will grow by 3.1 per cent in 2024 and 3.2 per cent in 2025. Growth
in advanced economies is projected to decline slightly from 1.6 per cent in 2023 to 1.5 per cent in 2024 before
rising to 1.8 per cent in 2025. The United States’ growth
is expected to fall from 2.5 per cent in 2023 to 2.1 per
cent in 2024 and 1.7 per cent in 2025, driven by the
effects of tighter monetary policy and the eventual tightening of fiscal policy. On the other hand, growth in emerging markets and developing economies is ex-pected to moderately increase to 4.1 per cent in 2024
and further rise to 4.2 per cent in 2025. Global inflation
is expected to continue its downward trajectory, falling
to 5.8 per cent in 2024 from 6.8 per cent in 2023 and
further to 4.4 per cent in 2025.
Mr. Speaker , while the current tight monetary
environment has dampened global inflation, uncertainties remain regarding the speed, strength and unevenness of monetary policy and inflation persistence. Central banks holding policy rates higher for longer periods
can result in increased credit and financial stability
risks. Tighter credit conditions can hinder investment,
consumption, employment, housing markets and gen-eral economic activity. In addition, there is potential for
unfavourable supply shocks to recur in the global commodities markets. Markets remain tight , and there are
still risks for supply disruptions in the gas, coal and oil
markets. An escalation and spread of the ongoing conflict in the Middle East to neighbouring economies could impact energy prices. Favourable scenarios , of
course, include faster disinflation, an easing of monetary policy, and increased global demand and investment.

Bermuda’s Economy

Hon. E. David Burt: Mr. Speaker , I will now focus on
the Bermuda economy. Bermuda’s gross domestic
product [GDP ], the primary indicator for [ economic ]
growth, is estimated to have grown between 4.0 [per
cent] and 4.5 per cent in 2023. Mr. Speaker, this is following on an expansion of 6.4 per cent in 2022. T his is
as a result of the continued positive economic performance by new international business registrations, visitor spending, higher employment and employment income, and greater household consumption.
Mr. Speaker , Bermuda continues to see a
growth in international business. The year 2023 saw 569 new company incorporations for the first three
quarters and a 4.6 per cent increase in jobs, with 215
[new] jobs being filled for the full year. This sector now ,
Mr. Speaker, provides 4,909 jobs in Bermuda , the highest ever recorded, surpassing the previous peak of
4,761 jobs in 2008 before the Great Recession.
Mr. Speaker , the latest annual GDP estimates
for 2022 showed that the value added for the accommodation and food service sector grew by 40.5 per
cent, surpassing pre- pandemic levels of 2019. This
was driven by a $123.4 million value added for accom-modations, as visitors resumed regular travel. The tourism sector has seen continued recovery in both arrivals
and spend during 2023. Leisure air arrivals increased
by 21.9 per cent and cruise arrivals by 30.5 per cent
when compared to the prior year . Total air v isitor spend
reached $341 million, up 26.4 per cent from 2022, and
total cruise visitor spend totalled $151 million, up
46.8 per cent from the prior year , surpassing pre- pandemic levels. Further, the superyacht sector attracted
56 visits with an estimated economic impact of $2.9 million.
Revenue per available room increased by
22.6 per cent , driven by an increase in hotel occupancy
of 15.5 per cent and a 6.0 per cent increase in the average daily rate. This uptick in overall tourism activity
has also resulted in the second consecutive year of job
growth in the sector which added 339 jobs, bringing the total number of jobs to 3,636.
Mr. Speaker , the construction industry for the
first half of 2023 experienced a decline in the value of new projects started and estimated value of work put in place. The value of new projects started declined by
50.5 per cent and the estimated value of work put in
place by 7.7 per cent when compared to 2022. This reduction is primarily due to fewer hotel - and guest
house- related construction projects occurring in the
first half of last year. Despite the reduction in construction activity, employment in the sector remained con-stant when compared to 2022, totalling 2,054 jobs
filled. That , however , is expected to change in 2024
with the Fairmont Southampton renovation, the
370 16 February 2024 Official Hansard Report

Bermuda House of Assembly Brookfield Building on Front Street and the Morgan’s
Point development advancing.
Mr. Speaker , Bermuda’s overall rate of inflation
remains relatively low when compared to advanced
economies, as reflected in the Consumer Price Index,
which indicates an annual inflation rate of [2.4] per cent
for September 2023. Bermuda’s balance of payments
continues to record relatively large current account sur-pluses, which are an important strength in the Bermudian economy. Bermuda’s total current account surplus
over the first two quarters of 2023 was recorded at $671 million .
Mr. Speaker , sustainable economic growth
cannot be achieved without an expansion of jobs within our economy and a reduction in unemployment levels.
This Government continues to deliver on increasing the
number of jobs in the Bermudian economy despite global headwinds . In 2023, the total number of jobs
filled in Bermuda increased by 935 posts , or [2.9] per
cent, growing from 31,914 in 2022 to 32,849. Employment levels have been driven by record levels in the international business sector , our recovering tourism
sector , and the professional, scientific, and technical
sector , which collectively represented 68.8 per cent of
the total new jobs filled in 2023.
Employment growth was observed in employment income across all sectors for the first two quarters of 2023. Overall, employment income was estimated to have increased by 6.0 per cent , or $121.4 million, when
compared with the same period in 2022. This increase was driven by the international business sector, which saw an increase of $51.3 million, or 6.0 per cent . The
hotels and restaurants sector saw the largest year -
over-year growth, increasing by 21.6 per cent versus
the prior year .
Mr. Speaker , total gross turnover in the retail
sector also experienced an increase. For the first eight months of 2023, total gross turnover stood at $809.4
million , [which is] 3.1 per cent , or $24.7 million , higher
than the same period in 2022.
Mr. Speaker , we are trending in the right direction, and many of our major economic indicators continue to signal moderately strong recovery from the
pandemic and recent geopolitical conflicts. Employ-ment and employment income continue to show robust
growth, inflation continues on its downward trend, and
tourist arrivals are nearing pre- pandemic levels while
average tourist spend is above pre- pandemic levels.
Though the current environment has led to a faster than
expected fall in inflation, we are facing some of its aftereffects. The people of Bermuda and local businesses have experienced the impact of higher global
interest rates, placing additional pressure on family
budgets with higher mortgage payments. While local
retail sales continue to grow, retail sales volumes are
down. On the upside, interest rates are expected to fall
in several advanced economies in the latter part of this
year, inclusive of the United States , which should lead
to lower mortgage rates in Bermuda. Mr. Speaker , Bermuda still faces several external risks: a prolonged high interest rate environment,
geopolitical tensions, slower global demand and , of
course, climate -related risks. It is for these reasons the
Government is committed to returning to a balanced budget and eventual budget surplus, creating the fiscal
space to dampen potential negative shocks to the Bermudian economy and to protect the welfare of Bermudians. We must execute our Economic Development
Strategy to ensure Bermuda stays on a sustainable
growth path, remains globally competitive and builds upon the country’s established A class rating among international bodies.

Credit Ratings & Independent Analysis

Hon. E. David Burt: Mr. Speaker , with some local media seemingly deeply invested in undermining the work
of our Government and damaging the reputation of Bermuda across the globe, it continues to be critically important for the G overnment and the people of Bermuda
to earn an independent, non- political evaluation of our
fiscal performance. Beyond refuting the narratives of
those who care more about undermining the Government than collectively working toward the success of
Bermuda, assessment s from world- leading, highly regarded agencies and committees also help retain and
attract new business to the I sland, ultimately benefitting
our people and our economy.
Mr. Speaker , in their May 8, 2023, ratings report for Bermuda, S&P reaffirmed Bermuda's A+ longterm sovereign credit and senior unsecured debt ratings, as well as its A -1 short -term rating and its AA+
transfer and convertibility assessment as stable. Within
their report, S&P highlighted t hat they “expect the local
economy to remain healthy, supporting government finances, limiting the need to increase gross debt, and supporting the territory’s external position (including
current account surpluses) .”
KBRA’s October 6, 2023, ratings report then
solidified the S&P assessment as they affirmed Bermuda’s long- term rating at A+ with a stable outlook,
while the short -term rating was affirmed at K1+. KBRA
stated within their report that Bermuda’s ratings reflected its commitment to fiscal restraint and consolidation, even if slightly delayed, the ongoing recovery of
tourism, and KBRA’s expectations for durability in its
status as a financial hub.
Moody’s, in their 2023 ratings report, affirmed
Bermuda’s A2 issuer and senior unsecured bond rat-ings, along with a stable outlook, indicating that Bermuda’s bonds are seen to be of good quality with a low
credit or default risk. The stable outlook reflects
Moody ’s expectations that fiscal consolidation efforts
will stabilise debt around current levels due to the rebound in tourism activity and strong growth in the international business sector.
Mr. Speaker , these ratings are an objective endorsement of the Government ’s fiscal and economic


Bermuda House of Assembly policies, which are aimed at strengthening the economy as the country rebounds from the COVID -19 pandemic. We must also acknowledge the independent assessment of the Fiscal Responsibility Panel tasked with
assessing Bermuda ’s fiscal strategy with a focus on
public spending, taxation, borrowing and debt reduction. In their December 2023 report, the panel stated ,
“Bermuda now has a significant primary surplus. It has
done well over the past few years to maintain a credible
path towards a balanced budget, despite a number of
adverse shocks, most obviously the pandemic. Spending has generally been kept under control, and steady
revenue growth has therefore largely fed through into
deficit reduction.”
Mr. Speaker , these independent endorsements of the Government ’s fiscal and economic policies do not naturally align with the narrative of the Combined Opposition. Consequently, the people of Bermuda must ask themselves, Should we trust the words of globally recognised, politically independent assessment agencies, or the negative narratives being pro-moted by other, arguably less qualified and less objective entities? Regardless, we will uphold these high
standards and ensure that our work goes beyond
global recognition and into real and positive impacts on
the lives of the most vulnerable Bermudians.

Six Years of Continued Progress

Hon. E. David Burt: Mr. Speaker , since being given
the humbling responsibility to serve our people back in
2017, our Government has fought to reduce the financial burden on the lives of those who work tirelessly but
still struggle to make ends meet. We have fought and will continue to f ight for greater economic inclusion,
greater economic parity and greater social mobility. While we cannot claim to have gotten everything right, we remain steadfast in the belief that executing on the
values, aims and objecti ves of our political forefathers
benefit s our people far better than slashing scholarships and social programmes through austerity and
only representing the viewpoint of the elite and the privileged.
Mr. Speaker , in keeping with the values and
beliefs of our labour foundation and history, over the
last six years we have committed to policies that increase social protections for our workers and ensure
higher income earners pay their fair share, while
providing relief for the average worker. The last fiscal
year marked this Progressive Labour Party Government ’s fourth reduction of payroll tax for the majority of
Bermudians. Our tax cuts have saved the average Bermudian worker over $5,000 since we have be en in office. Some, Mr. Speaker, have saved up to $9,000
since we have been in office. If we had kept Payroll Tax
rates at the level the One Bermuda Alliance had left
them, the average worker in this country would have
seen $5,000 more come out of their pay cheques , and
the impact of the global cost -of-living crisis would have had a far deeper impact on Bermudian families and
their ability to make ends meet.

Wow.

Hon. E. David Burt: It is important! Yes.
We also reduced payroll taxes for all local businesses, including the elimination of payroll taxes for self-employed fishermen, farmers and employees with
disabilities. This level of tax reduction has provided many local businesses with much- needed relief, helping them continue to operate, continue to hire more
workers and continue to grow. In further support of local
businesses and to encourage jobmakers, the Government also arranged for new businesses to receive a
one-year payroll tax holiday, which has r esulted in a
wider range of job opportunities in Bermuda. We also
doubled the guarantee capacity at the Bermuda Economic Development Corporation [BEDC] and increased funding to further support our hard- working entrepreneurs.
Mr. Speaker , one of the crowning achievements of this Government in 2023 was the implementation of a minimum wage for the first time in Bermuda’ s
history and setting it at a rate that makes it one of the
highest minimum wages in the world. Our G overnment
ensured that no worker in this country will be denied the
opportunity to earn a fair day ’s pay.
Mr. Speaker , this Progressive Labour Party
Government is rooted in its support for our workers . But
yes, we also revere our seniors. We understand the
challenges many of our seniors are facing, and while the Opposition told them, Money doesn’ t grow on trees,
we are committed to ensuring that our seniors ’ incomes
keep pace with inflation, thereby helping to protect their
standard of living, and have delivered pension increases at or above the rate of inflation since 2017. We
also eliminated land tax for nursing homes and
amended legislation to provide bett er standards in our
care homes , as we appreciate the valuable services
these facilities provide to our precious seniors. We expanded the personal home care benefit, introduced local radiation therapy coverage for FutureCare and HIP
and increased the Future Care prescription drug benefit
from $2,000 to $3,000 a year. We also introduced interest -free home improvement loans of up to $15,000
for families needing assistance to make their homes
more senior -friendly.
Mr. Speaker , along with our workers and seniors, this Government views the family unit as the nu-cleus of our society, which is why this Government continues to find ways to provide relief for Bermudian families as part of a people- centred economic recovery.
This Government recently enhanced the child daycare
allowance, increasing the amount of money available
to families while expanding e ligibility , allowing more
parents to gain access to quality childcare, which is essential for our I sland ’s future. To su pport our childcare
372 16 February 2024 Official Hansard Report

Bermuda House of Assembly providers, we also eliminated duty for childcare centres, helping to drive down their expenses.
Mr. Speaker , earlier today we announced the
highest level of employment in international business in
Bermuda ’s history!

[Desk thumping]

Hon. E. David Burt: This achievement is proof positive
that this Government ’s economic policies are working.
Six years ago in our first budget, we ensured that every Bermudian was able to attend Bermuda College regardless of their financial status. We doubled scholarships to invest in higher education for Bermudians, we
expanded t raining programmes to upgrade the skills of
Bermudians displaced from the workforce and we worked with our international business sector to signif-icantly expand internship opportunities for young Bermudians.
Six years later , Mr. Speaker , we see the results
of those actions. Not only are there more international
business jobs in Bermuda than ever before, but there
are more Bermudians employed in the international
business sector than ever before, with 506 more Bermudians working in international business than in 2017.

Yes! Yes!

[Desk thumping]
Hon. E. David Burt: These 506 Bermudians are earning good wages, moving up the corporate ladder and
setting an example for the next generation.
Mr. Speaker , this is not by accident . It is not a
fluke; it is the result of a Government that has for the
last six years invested in our people and invested in our
future.

[Desk thumping]

Hon. E. David Burt: Standing with our worker s. Standing with our seniors . Standing with our young peopl e.
Standing with families and our children. That is how we
maintain the values of those who came before us while
building a better future for all Bermudians.

Public Sector Employment

Hon. E. David Burt: Mr. Speaker , the Opposition quite
often has the same talking points when referring to Bermuda ’s public service. They love to rally their base by
claiming it is overstaffed and accuse the Government
of expanding its size, while consistently advocating for
privatisation. However, as many Bermudians learned
during their one term in Government, there is often a
huge difference between what they say and the facts.

Yes! Yes.
Hon. E. David Burt: In July 2017, the total number of
persons employed by the government was 4,661, while
as recently as December 2023 that number was 4,469,
which means there are 192 fewer people working for
the government than when we took office. Rather than
shoving honest hard workers out on the streets, the
way the Opposition and their online cheerleaders want,
we have prudently managed the modernisation and
streamlining of our g overnment. It should also not be
forgotten that this Progressive Labour Party Govern-ment has increased pay while keeping health insurance rates steady for our public officers since returning to office in 2017. We have treated them as human beings
rather than numbers in a ledger to be victimised, and
still ensured that the g overnment ’s total monthly payroll
cost is approximately $270,000 less than it was under the OBA, without demanding that they take furlough
days.

[Desk thumping]
Hon. E. David Burt: Mr. Speaker , the Opposition is
making it up as they go along, parroting baseless
claims spun by their political consultants in order to appeal to their voter base who are hostile to our public
officers . But the data clearly reflect that this Government has controlled the growth of the public service.

Economic Development Strategy

Hon. E. David Burt: Mr. Speaker , last year the Honourable Minister of Economy and Labour unveiled Ber-muda ’s Economic Development Strategy, which sets
out a roadmap to sustainable economic growth and development for Bermuda. The Economic Development
Strategy has five strategic priorities :
1. the expansion of local and international business ;
2. attracting new business and foreign invest-ment ;
3. the development of entrepreneurship and
small businesses ;
4. the continued execution of the Government ’s
Economic Recovery Plan ; and last but certainly
not least ,
5. investing in our people.
This Government firmly believes that a thriving
business environment is critical to the success of our economy, as it supports our quality of life and commu-nity. To that end, the Government is committed to the
execution of the strategic priorities and impr oving conditions for businesses to set up, grow and operate successfully.
Mr. Speaker , the Government is proud to see
a number of initiatives completed which have already
demonstrated positive results. These include the following:
• a legislative framework that established Bermuda ’s subsea communications sector , which


Bermuda House of Assembly has attracted Google to set up operations in
Bermuda;
• dozens of young Bermudians on the path to
home ownership because of the Government ’s
Mortgage Guarantee Programme;
• the Economic Investment Certificate initiative
injecting over $440 million into our economy ;
• the investment in affordable housing which has
delivered 67 new affordable housing units ; and
• the BEDC ’s COVID -19 Support Programme
which has successfully supported a range of
small and medium- sized businesses during
their darkest hour.
I must emphasise that this is our strategy to
grow and diversify our economy, this is our strategy to enhance Bermuda’ s value proposition and this is our
strategy toward a prosperous Bermuda. Any sugges-tion that the Government has no economic plan is simply not true. The Economic Development Strategy
is specific in detail, including action items, and I would
encourage everyone to read through the strategy to get
a better appreciation of the direction that this Government is heading.
Mr. Speaker , it should also not go unnoticed
that the Economic Development Strategy was debated in this Honourable House and passed without any objection. I would like to take the opportunity to thank the
Opposition for erring on the side of bipartisanship as I believe we can all agree that this strategy is the right
path forward to achieving our goal of a better and fairer Bermuda.

Well done. Well done. Well done.

[Inaudible interjections and laughter ]
Hon. E. David Burt: It is good that they are waking up
now, Mr. Speaker. You know, we have got a ways to go.
[Inaudible interjection and laughter]
Hon. Walter H. Roban: There is a lot of writing to do
before next week.

Mortgage Guarantee Programme

Hon. E. David Burt: Mr. Speaker , in the Government ’s
2020 election platform, we pledged to work with local
banks to provide security for mortgage loans to reduce
interest rates charged. In October 2022, the Government launched its Mortgage Guarantee Programme
where the Government provides a partial guarantee to
support local mortgages with the Bermuda Commercial
Bank. In return, the b ank is offering a reduced interest
rate starting at 5 per cent and also a reduced down payment requirement from the standard 20 per cent to
10 per cent . With this programme we are not only reducing a first -time homeowner ’s monthly repayments but also reducing the down payment requirement as
well, making it more affordable for Bermudians to own
their own home.
Mr. Speaker , we are currently in the second of
three phases where any first -time home buyer, no matter their age, is eligible. Also, as part of the second
phase, all public officers with existing mortgages at
other institutions are eligible to transfer them to the Bermuda Commercial Bank and participate in the programme. I am also pleased to announce that beginning
April 1, we are expanding phase 2 to include employees of g overnment quangos and part -time regiment
soldiers , who will now also be able to transfer their
mortgages into this programme. To date, over 49 appli-cants have been approved and are on the path to home
ownership or lower mortgage rates . That is , 49 Bermudians , and counting , [who] are able to own their “ piece
of the r ock” who may otherwise not have been able to
do so without the forward- thinking policies of this Progressive Labour Party Government.

Yes! Well done!

Making Mortgage Transfers Easier
Hon. E. David Burt: But, Mr. Speaker, it is important to
recognise that, you know, not everyone wants to buy a
new home. And there are some banks in this country
who have raised interest rates significantly over the
past few years. So we must make mortgage transfers
easier.
Mr. Speaker , last year the Government made
several amendments to the Stamp Dut ies Act, one of
which ensures that the refinancing or transferring of
mortgages $1 million or less [will] no longer incur any
stamp duty fees, while those in excess of $1 million
would only be subject to stamp duty on the excess amounts. With these changes, the Government seeks
to create a more competitive environment amongst our
local banks, which in turn will help to put the power bac k
into the hands of the consumer. Put simply, if someone
with a mortgage of $1 million or less is unhappy with
their mortgage rate and is offered a more favourable
rate at another bank, this Government has made it possible for them to transfer their mortgage without incur-ring any g overnment taxes.

[Desk thumping]

Major Construction Projects

Hon. E. David Burt: Mr. Speaker , one of the positive
aspects of the Government ’s work is the fact that Bermuda will see three major construction projects commence this year : (1) the Fairmont Southampton project ;
(2) the Brookfield building on Front Street ; and (3) the
Morgan’ s Point development.
Mr. Speaker , we have all heard the announcements from the developer regarding the work starting
374 16 February 2024 Official Hansard Report

Bermuda House of Assembly at the Fairmont Southampton Hotel, and I know that all
residents eagerly anticipate the site renovation works
and eventual re- opening of this hotel. The projections
are that this project will create 700 jobs during its con-struction phase which is scheduled to last for 15
months. Demolition works have also commenced on
Front Street for the new Brookfield building, and this
project is projected to add 200 jobs over the next 18
months. This will deliver a modern building, removing boarded- up windows and replac ing them with prime retail and office space. This investment by Brookfield is a
vote of confidence in Bermuda.
Mr. Speaker , last year in the Budget Statement
I outlined the Government ’s vision for Morgan’ s Point.
Over the last year we have been preparing the groundwork to commence the development phase of this project and immediately add high- end housing stock to the
country as support for the significant demand from our
growing international business sect or. The addition of
rental capacity by way of the completion of partially
constructed buildings is the best way to reclaim value at the site with the lowest execution risk. It also supports the work of design and development of a wider
spectrum of rental units on the site to address the
pressing housing needs at all levels. And yes, Mr.
Speaker, you must remember that there was a wide variety of housing that is planned there. So the first phase
is the buildings that are already there. But then there is a new building to be constructed.
The Government is working to finalise the Morgan’s Point Development Company Board, and discussions have already been held with local banks to finance the first phase of construction of the five buildings that have been partially completed, which will add
an additional 35 units to Bermuda ’s housing stock. Importantly, it is the view of the Government ’s advisors
that this initial phase of the project will not incur any additional expense to the Government, and once completed and rented the cash flows from this phase will
exceed the cost of repaying the incremental borrowing,
which is the approach intended at each following
phase.
Mr. Speaker , it is vital that we continue to stay
the course by adhering to our Economic Development Strategy, which builds on our Economic Recovery Plan
that has yielded positive economic growth, a recovery
of jobs since the pandemic, unemployment falling to
lower t han pre- pandemic levels, and record international business growth and jobs in Bermuda. Mr.
Speaker , our economic policies are working. T hey are
delivering balanced economic growth, and that growth
is translating to stronger -than- expected tax revenues
leading to solid fiscal performance.

2022/23 Fiscal Performance

Hon. E. David Burt: Mr. Speaker , the annual financial
statements for fiscal year 2022/23 are still being audited and will be tabled in this Honourable House when they are complete. Notwithstanding, I will share the fiscal performance highlights for the last fiscal year with
Honourable Members and the country today.
For the fiscal year ending in March 2023, total
revenue for the government was $1.127 billion, which
was $49.3 million ( or 4.6 per cent ) above the original
estimate of $1.078 billion and $[ 41.5] million above the
previous year’s revenue of $[1.086] billion. It should be
noted that in spite of not receiving $30.1 million of budgeted revenue due to the impact of the Russia/Ukraine
war on the aircraft register, forgone customs duty from the freezing of fuel prices and forgone customs duty as
a result of elimi nating duty on essential goods, the government exceeded the original revenue targets.
Mr. Speaker , current account expenditure is
anticipated to be $[ 947.1] million, just $2 million above
the 2022/23 original estimate of $ [945.1] million, and
only $2 million higher than the fiscal year 2021/22 figure of $945 million. It is worth noting that this $947.1
million includes unplanned expenses as follows: $15
million for the COVID -19 pandemic; a $15 million special grant to support the hospital; additional funds for firefighters at the airport; and the Government ’s economic relief measures such as the payroll tax rebate, relief funds to parents of public school students and the
increase in food benefits for those on Financial Assistance. Despite all of these additional and unplanned ex-penses that arose during the year, which were necessary as the Government provided relief and assistance
in the face of 40- year-high global inflation, this Government ’s fiscal discipline was able to keep current expenditure largely in line with the original budget, exceeding it by only 0.2 per cent.
Mr. Speaker , interest/guarantee management
costs are expected to be $140.6 million, $10.9 million
more than originally budgeted, with most of this increase related to one- time costs for the debt refinancing which occurred in the s ummer of 2022 and continued expenses for Morgan’ s Point. Capital account expenditures are projected to be $67.4 million, $5.6 million less than originally budgeted, primarily as a result
of delays with the refurbishment of Tynes Bay Wasteto-Energy facility due to supply chain constraints.
Mr. Speaker , based on these figures, the
2022/23 budget deficit is expected to be $28 million, which is $42 million [60 per cent] below the original estimate of $70.0 million and a $38.2 million reduction
when compared to the previous fiscal year. It is also
important to note, Mr. Speaker, that when I delivered
last year ’s Budget [Statement] , the expectation was
that the deficit would be $77 million. As such, this $49
million improvement will allow this Government more
fiscal space in next year ’s Budget to deploy additional
resources to shield Bermudians from increased price
pressures.
Mr. Speaker, t his outstanding fiscal performance demonstrates that despite the socio- economic
challenges and significant relief provided during that
fiscal year, we have yet again exceeded expectations


Bermuda House of Assembly while remaining on track to reducing our budget deficit
toward achieving the balanced budget that was promised in the Government ’s 2020 election platform.

2023/24 Fiscal Year Performance

Hon. E. David Burt: Mr. Speaker , before I share the
estimates of revenue and expenditure for next fiscal
year, I would like to provide an update on the Government ’s financial performance for fiscal year 2023/24 ,
which is coming to a close next month. The latest revised forecast projects that the Government will earn
$1.159 billion in revenue in 2023/24. This is $3.3 million more than the $1.156 billion in the original estimates.
This is primarily due to payroll tax, land tax and interest
on deposits performing better than expected, which
were somewhat offset by lower -than- expected collection of stamp duty fees, passenger tax and hotel occupancy tax.
Mr. Speaker , this revenue performance is on
the back of a significant reduction in the tax burden for
workers and local businesses, which is estimated at
$20 million. All local businesses paid less in payroll tax
last year than the year before, and all workers earning
under $132,000 a year also paid less in payroll tax than they did in the previous year. Mr. Speaker , the same
changes that the Opposition branded as irresponsible
saw the tax burden fall for every local business and 86 per cent of workers of this country while still delivering record payroll tax revenue.
[Desk thumping]
Hon. E. David Burt: Mr. Speaker , the projected
2023/24 operating expenses of the Government, excluding debt service and guarantee management, are $987.2 million, or $14.6 million [ 1.5 per cent] more than
the $972.6 million originally budgeted. Significant contributors to the increase are the additional $16.3 million
grant to the Bermuda Hospitals Board to meet their
funding shortfall, negotiated salary increases for civil
servants, but unbudgeted expenses related to the establishment of the corporate income tax framework and
costs associated with the recent cyber attack. Despite these unbudgeted costs which totalled $46.5 million,
Ministers have been able to identify savings in their departments that have minimised the overall increase in
current account spending.
Debt service and guarantee management
costs are estimated to be $131.4 million for this fiscal
year, $1.0 million [0.8 per cent] above the original estimate of $130.4 million. As a result of the limited availability of construction resources and continued supply
chain challenges, capital expenditure for fiscal year
2023/24 is expected to be $84.1 million, which is $11.9
million ( or 12.4 per cent ) below the original estimate of
$96 million. Despite this shortfall, Mr. Speaker, yearover-year capital expendit ure has increased by $15.9
million. Mr. Speaker , given the figures above, the revised estimate for the overall deficit for 2023/24 is $43.9
million, or $438 ,000 (or 0.9 per cent ) more than the
$43.5 million deficit originally projected. This result has
been achieved despite the aforementioned circum-stances and is a testament to the dedicated efforts of
the elected G overnment and the public service in exercising financial control to ensure that we can meet our
budget targets. As of the 31
st of March 2024, net debt
is projected to stand at $3. 17 billion. During this fiscal
year, Mr. Speaker, it is important to note that the Government paid $9.7 million out of the sinking fund to repay the Bermuda Gaming Commission’ s outstanding
credit facility to a local bank , which the Government had
guaranteed.

2024/25 Budget Estimates
Hon. E. David Burt: Mr. Speaker , I will now turn my
attention to the budget for the next fiscal year , fiscal
year 2024/25, which are the estimates that I am presenting today. P rojected revenue for fiscal year
2024/25 is expected to reach $1.23 billion, which is
6.6 per cent, or $76.8 million, above the original estimates for this current fiscal year. Current account expenditure is forecasted at $992.0 million, an increase of
$19.4 million, or 2 .0 per cent, above the original estimates for this current year. The current account balance before debt service is expected to be $240.3 million, which is $57.4 million above the original estimates
for the current fiscal year.
Mr. Speaker , it is critical that I not only provide
the public with the numbers, but also provide some con-text as to what these numbers mean. Therefore, as a reminder, the current account balance excluding finance costs and capital expenditure reflects whether
the Government ’s expected r evenues will be sufficient
to support its day -to-day operations .
Mr. Speaker , with the current account balance,
we then focus on covering the costs associated with
servicing our debt and guarantee management, which
is projected to be $127.7 million, or $2.6 million (or
2.0 per cent) less than the original budget for this fiscal
year. This reduction in interest expense is mostly at-tributed to the repayment of $50 million of long- term
debt last year.
Mr. Speaker , after interest expense, the sole
remaining expenditure category is capital expenditure.
Capital expenditure for fiscal year 2024/25 is forecast
to be $112.3 million, which is $16.3 million, or 17 per
cent, more than the current year ’s original estimate.
This level of capital expenditure is the largest budgeted
investment in capital since 2010.
Mr. Speaker , when the aforementioned estimates for revenue and expenditure are compiled, it is
my privilege to state to this Honourable House and the people of Bermuda that this Progressive Labour Party
Government has successfully balanced Bermuda ’s
budget —
376 16 February 2024 Official Hansard Report

Bermuda House of Assembly [Desk thumping]

Yes!
Hon. E. David Burt: —with a projected surplus of
$210,000. That number has a significant meaning, Mr.
Speaker, which I am sure we will get to over the next
few weeks. This budget surplus is only the second
budgeted surplus in 35 years! Mr. Speaker , the last
time Bermuda achieved a balanced budget was in fis-cal year 2002/03. But today, 21 years after that was last
achieved, through the turmoil of a great recession and
after being battered by a once- in-a-century pandemic,
we will return this country back to a balanced budget.

[Desk thumping]

Revenue
Hon. E. David Burt: Mr. Speaker , our Government recognises how global inflation has challenged so many in
our community. Conscious of that fact, th is Government will not be increasing taxes or introducing any
new taxes for any individual or business. Instead, we have focused on growing revenues through economic growth and diversification. Payroll tax receipts are
budgeted to see a $58 million improvement as a result of the continued growth amongst the Island ’s working
population, in particular within the international business and construction industries and the revision of the
new hire relief that is scheduled to expire at the end of
March 2024.
Mr. Speaker , the new hire relief was instituted
for exempted companies and large employers in 2018 as an economic stimulus measure to promote the hiring
of persons in Bermuda. Companies who added to their payroll from April 2018 did not pay employer payroll taxes for their additional employees. During last year ’s
budget presentation I stated the following: “ Mr.
Speaker, though it is unlikely that this successful relief
which has boosted employment numbers will come to
an abrupt end, it must be modified, as it cannot be fair
for exempted companies that started in 2018 to not pay
any employer taxes after 2024 while our long- standing
exempted companies continue to pay taxes on employees hired before 2018. ”
Mr. Speaker , in this year ’s pre- budget report
the Government put out to consultation the options un-der consideration for the extension of this exemption to
solicit feedback from affected employers. After consid-eration of the overall budget requirements and the need
to increase capi tal account expenditure to tackle Bermuda ’s infrastructure, the Government will extend the
new hire relief for a further two years, to expire in March 2026. However, we will adjust the baseline [year] for
the new hire relief from 2018 to 2022. This extension
and adjustment to the new hire relief is expected to yield an additional $30 million in payroll tax revenue.
Tax Collection

Hon. E. David Burt: Mr. Speaker , last year the Government set a target to collect $7.5 million in back taxes , and I am pleased to report to this Honourable
House that we have exceeded that target by collecting
over $15.7 million, which is more than double the target. This year the Government will continue to advance its efforts toward tax collection through enhanced enforcement and simplified policies and processes. And,
Mr. Speaker, we have also set a target to collect $10
million for this current year.
Mr. Speaker , much of this can be attributed to
the investment in a new debt management system, and
I would like to commend the team at the Office of the
Tax Commissioner for their hard work. This year the
Government will implement additional measures to in-crease tax compliance by proposing legislative amendments to ensure specific government servic es are suspended for delinquent taxpayers and implementing
measures to simplify the tax collection process. The
Government is also increasing coordination with t he
Department of Public Prosecutions to advance collection actions against those persons who have been
deemed to have the means to pay but refuse to communicate and/or work with the Tax Commissioner.

Current Account Expenditure

Hon. E. David Burt: Mr. Speaker , last year in the
Budget Statement I said the following: “The Cabinet is
aware that the current expenditure level this year will
carry over to next year and that any new programmes will need to be offset by revisions to existing ones,
which in essence makes this a two- year budget. Current expenditure is expected t o increase by 1 per cent
over the next two fiscal years, which has been inserted solely to take into account possible negotiated salary
increases for public officers .”
Mr. Speaker , negotiated settlements with our
union partners amounted to a $20.0 million increase to
payroll, benefits and overhead expenses. That in-crease is incorporated into the current expenditure estimates , which project an increase of $19.4 million dollars to $992.0 million compared to last year ’s figure of
$972.6 million. Though this increase was more than
was expected last year, we are proud of the agreement
reached with our union partners , which provided pay
increases for public officers after year s of sacrifice following the pandemic. Later in today ’s presentation I will
detail the highlights of expenditure from various ministries; however , Mr. Speaker , the people can rest assured that this budget funds the priorities laid out in our Throne Speech to execute our people- focused agenda.

Interest on Debt & Guarantee Management Fees
Hon. E. David Burt: Mr. Speaker , in December 2023
the Government honoured its commitment to repay $50


Bermuda House of Assembly million of gross debt by making a $50 .0 million bond
repayment. This repayment reduced annual interest
costs by $2.4 million for the upcoming fiscal year to
$127.5 million. Given the number of guarantees that
have been made by the Government, an additional $250 ,000 has been set aside to ensure that there is adequate risk management of the guarantee portfolio.
The Government does not expect to incur additional
guarantee expenses in fiscal 2024/25 related to Fairmont Southampton or for Morgan ’s Point.

Capital Expenditure
Hon. E. David Burt: Mr. Speaker , I must talk on an important topic to many, which is capital expenditure . Mr.
Speaker, capital expenditure is funds used to purchase, upgrade or maintain government assets or an
investment deemed necessary by the Government for
the long- term benefit of the country. This includes the
purchasing of new buses and ferries, repaving our
roads, upgrading the government ’s technology, stabilising our waste management system, repairing
bridges, upgrading our school campuses, improving facilities at our hospitals and further investments in affordable housing. The need to reduce the budget deficit
has resulted in continued underinvestment to meet
budget targets.
Mr. Speaker , it is important to note that international standards state that capital expenditure for developed economies should be between 2 [per cent] and
4 per cent of a country ’s GDP. The [ accompanying]
chart shows how significantly Bermuda has been investing under this amount.
Mr. Speaker , despite this year ’s 15-year high
capital account expenditure totalling $113.2 million,
that amount only equates to 1.3 per cent of our GDP. If
we were to budget to the amount of capital investment
that is recommended by the World Bank, our capital expenditures budget should be $156 .0 million. As our
economy continues to strengthen, the investment strategy of the Government must be to budget a minimum
of 2.0 per cent of GDP on capital expenditure to ensure
that we maintain our infrastructure and do not find our-selves in a similar state in 15 years.
Mr. Speaker , it is going to take us a while to
catch up, as the infrastructure needs are great whether
they be the replacement of our bridges, the replace-ment of the Tynes Bay W aste- to-Energy Facility, the
repaving of our roads, the construction of new health
care facilities for our seniors or the building of new
schools. Our future financial policies must ensure we
are investing the necessary capital expenditure so that
our infrastructure does not again get to the state it is
today.

Ministry Highlights

Hon. E. David Burt: Mr. Speaker , this b udget fulfils its
pledge to invest in our people and our Island ’s future. I will now cover the highlights from various ministries that
are funded in this budget. It is vital that budgets match
the pledges made in our Throne Speech, and this budget delivers on those priorities.

Cabinet Office
Hon. E. David Burt: The Cabinet Office has been allocated $46.4 million , an increase of $1.7 million when
considering the transfer of departments; the majority of
this increase is due to salary uplifts. The Department of Information and Digital Technologies has received a
capital funding increase of $2.4 million, or 68 per cent,
for upgrades to network infrastructure, cybersecurity ,
and server upgrades. Additional funding has also been
allocated to staff the Digital Transformation Team
(which I will cover later, Mr. Speaker) . The Department
of Planning has received additional f unding for additional staff to speed onsite approvals at construction
sites. The department will advance policies to further
streamline planning approvals and develop an online
platform showcasing development opportunities at currently unused sites that have development potential.
To promote the use of agricultural zoned land,
the department has created the “ Grow Bermuda” initiative for landowners to connect with others who are looking for land suitable for farming. The Department of Em-ployee and Organi zational Development has received
funding to complete the salary review of specialist roles
in the public service to ensure that the Government can
attract and retain experienced talent in key areas such
as legal, engineering, compliance, information technology and finance. Additional funds have been awarded
to expand bursaries and training programmes to ensure adequate succession planning within government.

Legal Affairs

Hon. E. David Burt: The Ministry of Legal Affairs has
been allocated a budget of $33.2 million, which is a decrease of $11,000. The Attorney General ’s Chambers
will improve the resources and workforce levels neces-sary to draft effective legislation and provide comprehensive legal advice and representation on behalf of
government ministries and departments. The Judicial
Department has been awarded capital funding to implement a new electronic case management system to
improve efficiency and connectivity within the system.
Through the Ministry of Public Works, capital funding has been allocated to complete the renovation of the
court facilities in the Dame Lois Browne- Evans building, which will see all Supreme Court matters vacate
Sessions House. (Are you are going to tap for that one,
Mr. Speaker?)

[Desk thumping]
[Laughter]

378 16 February 2024 Official Hansard Report

Bermuda House of Assembly An Hon. Member: Yes, yes!

Hon. E. David Burt: And the staff here, I am sure.
The Department of National Drug Control has
been allotted $4 million to address substance misuse and abuse, supporting administration, treatment, residential treatment and prevention programmes.

Finance

Hon. E. David Burt: The Ministry of Finance has been
allocated $240.5 million, an increase of $4.1 million primarily due to salary uplifts, increased employee overheads due to union pay agreements and new funding
for corporate income tax implementation. Key priorities
for the Ministry include advancing pension and tax reform while progressing critical international tax and regulatory reviews. Ministry Headquarters will advance the
implementation of an agency to administer the new corporate income tax and has received current and capital
funds to progress this vital initiative. The Accountant General has received capital funding to implement an
online payment portal for easier government payments ,
and the Department of Social Insurance has received
capital funding to upgrade the pension administration system, enabling online applications and search functions.
The Office of the Tax Commissioner has received additional capital funding to modernise systems
to enhance compliance and collections, and to improve
the user experience for online tax payments. The Registrar of Companies has received additional current and
capital funding to finalise the beneficial ownership register in line with the European Union’ s sixth Anti -Money
Laundering Directive. The Ministry of Finance will provide a grant of $800,00 0 to supplement the revenue
from the operations of the Bermuda Gaming Commission.

Education
Hon. E. David Burt: The Ministry of Education has
been allocated $142.6 million, an increase of $2.7 million due to salary uplifts. Mr. Speaker, there have been $2 million in Scholarships and Awards allocated for
post-secondary education. Important to note, Mr.
Speaker, is that this Government increased scholarships, while the former Government cut scholarships —
investing in our future, a point that we should never for-get.

Yes! Well done! Well done.

[Desk thumping]

Hon. E. David Burt: And, Mr. Speaker, I cannot help
but note in the Gallery the Honourable Minister from St. Kitts and Nevis, who is here joining us. So, yes, absolutely!
To increase the level of male teachers in the
Bermuda public school system where they can make a
significant impact as role models for our children, this year the Ministry will provide awards to assist males in
funding teaching practicums.

Yes! Yes!
[Desk thumping]

Hon. E. David Burt: The Bermuda National Library will
digitise library resources and hire a youth assistant to
aid in improving youth services and complete repairs to
shelving in the Youth Library to ensure the environment
is safer for our young readers.
Capital funding has been increased by 40 per
cent to $6.4 million to support education reform projects, completing developments at Francis Patton and
Purvis Primary, commencing the transformation of Elliot Primary School and Harrington Sound Primary
School into Parish Primary Schools, and Sandys Secondar y Middle School into a Signature School for September 2025. Necessary infrastructure repairs are
planned for CedarBridge Academy, the Bermuda College and other schools. The M inistry has been awarded
funding to continue providing tablets and Chromebooks
to public school students.

Health
Hon. E. David Burt: The Ministry of Health has been
allocated $200.4 million, an increase of $1.2 million.
This modest increase is primarily to cover the cost of
the negotiated salary increases. The majority of the Health Ministry’s budget is allocated to the Bermuda
Hospitals Board [BHB] . The M inistry will provide the
Mid Atlantic Wellness Institute [MWI] with its continual
operating grant which they are using to implement the
MWI directorate plan, including the adult acute mental
health pathway, improving access to mental health services, and addressing the stigma associated with mental health and intellectual disability.
The Health Ministry budget includes $112.5
million in BHB patient subsidies for the youth, indigent and the aged. The BHB will continue to drive quality
improvements through its electronic medical records
system. Th is year the Ministry will coordinate the
STEPS population health survey. Translating data from


Bermuda House of Assembly the STEPS survey and the continuing HEARTS risk
management programme will assist in defining the core
benefits package for universal health care, which is targeted for launch in July 2025.
Funded in part by the Ministry of Health, the
Bermuda Health Council will coordinate the implementation of the First 1, 000 Days C are Pathway, while the
Department of Health will reboot the Well Bermuda initiative, focused on preventative health at every level.
Additionally, the Environmental Health section will implement the iDocs data system to automate data col-lection.
Capital funding to the M inistry has been increased by 46 per cent to $8.9 million to assist with
capital works for the Bermuda Hospitals Board and to
complete the renovations for the Mangrove Bay Clinic
in Somerset .

[Desk thumping]

Transport

Hon. E. David Burt: The Ministry of Transport has
been allocated $68.2 million , a decrease of $4.1 million;
this decrease is due to the cessation of minimum revenue guarantees to Skyport, offset by increased salary
costs due to union agreements.
Capital funding has been awarded for the purchase of two new ferries. These new vessels will replace existing ferries, modernising the fleet and meeting the increas ed demand for efficient, reliable and sustainable transportation options. Work will continue on
the replacement of floating docks for ferry landings and
the Marine and Ports workshop. Additionally, digital fare media will be implemented for buses and ferries ,
marking a milestone in public transportation by intro-ducing a more efficient and conveni ent payment system.

Public Works
Hon. E. David Burt: The Ministry of Public Works has
been allocated $77.3 million , an increase of $2.1 million
primarily for salary uplifts. The M inistry ’s capital budget
has been increased by $8.4 million to $56.5 million.
Mr. Speaker , the Government acknowledges
the community ’s concern and frustration with the poor
state of roads and is committed to restoring them to an
acceptable standard. To address the widespread issues of public road conditions across the Island, the
road paving budget has been more than doubled to $5
million and additional capital funds have been allocated
to procure a new asphalt plant and related equipment,
as well as training and development for highways personnel to ensure more frequent , efficient and cost -effective roadworks.
Capital funding has been awarded to combat
the issue of affordable housing by increasing the grant
to the Bermuda Housing Corporation. Investment will continue in the ageing Tynes Bay facility infrastructure
to ensure its operational efficiency while plans for a full
refurbishment are underway. Additional capital investment is allocated for stabilising major walls and rockfaces along highways, developing rooftop solar across
government buildings to reduce energy costs, expanding electric vehicle charging in frastructure and commencing the replacement of Swing Bridge. [This replacement] is scheduled to start, Mr. Speaker, in April
of 2025, but the preliminary money is being put now so
we can get mobilised and get ready to start.
Furthermore, work will commence on a new
Parks Department maintenance facility for the staff responsible for preserving the I sland ’s natural beauty.

Tourism, Culture & Sport
Hon. E. David Burt: The Ministry of Tourism, Culture
and Sport has been allocated $29.6 million, a decrease
of $741,000 when considering the transfer of departments. Mr. Speaker, t he grant to the Bermuda Tourism
Authority has been reduced, and funding has been redirected towards increased funding in other priority areas. With these funds, the Ministry has increased funding for grants for cultural and entertainment events to
enhance interaction between visitors and locals , has increased funding for elite athletes through grants , has
increased access to the National Sports Centre, will increase funding to expand the availability and accessibility of affordable summer camp program mes (and the
Minister tells me that the objective is to eliminate the
waitlist) and has increased funding for sports development in line with the National Sports Policy.
As promised in the Throne Speech, capital account funding has been awarded for the establishment
of “maker spaces ” to create collaborative workspaces
for artists and creatives , and operational funding has
also been allocated to support this initiative.

National Security

Hon. E. David Burt: The Ministry of National Security
has been allocated $137.8 million , an increase of $6.4
million. The majority of this increase is due to negotiated salary uplifts, with some funding for new pro-grammes. New programmes include the implementation of a uniformed services training program me to improve Bermudian readiness for the uniformed services,
recruitment of cybersecurity posts and a Disaster Co-ordinator for the Disaster Risk Reduction and Mitigation
Team in the Ministry headquarters . Funding has been
allocated to fill vacant posts in the Bermuda Police Service, Cu stoms Department, the Department of Corrections and the Bermuda Fire and Rescue Service.
Capital funding has been increased by 19 per
cent to $6.5 million for refurbishing the police headquarters, purchasing new vehicles and computers , and
upgrading network servers . Additionally, those funds
will be used for the construction of a new Coast Guard
380 16 February 2024 Official Hansard Report

Bermuda House of Assembly shed; security upgrades at the Westgate Correctional
Facility , including a full body scanner ; and also, Mr.
Speaker, these funds will be used to purchase four specially designed trucks for the L. F. Wade International
Airport for the Bermuda Fire and Rescue Service.

Home Affairs

Hon. E. David Burt: Mr. Speaker, t he Ministry of Home
Affairs has been allocated $15.5 million, an increase of
$747 ,000 primarily for salary uplifts. The funds will support various initiatives aimed at improving customer
service and advancing key Government program mes.
Specifically, new funding will be used to recruit an additional Land Title & Registry Officer to expedite property adjudication.
Capital funding has been awarded to commence the long- awaited redevelopment of the Agriculture Marketing Centre, a critical element of the Inte-grated Agriculture Strategy and a necessary facility to
support increased domestic food production.
Digital projects will also be advanced within the
Ministry, such as the revaluation of all properties for
land tax purposes which will feature a digital question-naire. Applications for vital records under the Registry General [birth, death, marriage] will move online, along
with forms for dog licensing and relicensing.

Economy & Labour
Hon. E. David Burt: The Ministry of Economy and Labour has been allocated $23.9 million, an increase of
$843 ,000 primarily allocated for salary uplifts and economic development strategy initiatives. The Ministry ’s
focus includes leading policy and legislative initiatives
on immigration and workers ’ rights, a new family office
framework and monitoring the Economic Recovery Plan.
The Department of Statistics will complete the
2024 Household Income Expenditure Survey, while
capital funding has been awarded to the Department of
Immigration for digitisation to improve service delivery.
The Department of Workforce Development will expand the post -secondary Summer Employment Programme and continue supporting job seekers. The
Economic Development Department will advance
FinTech development and support grants to the Bermuda Business Development Agency [BDA] and the
Bermuda Economic Development Corporation [BEDC ].
Finally, t he Department of Labour will continue to enforce the statutory minimum wage and new tips and
gratuities legislation, promoting labour standards and
fundamental rights at work.

Youth, Social Development & Seniors

Hon. E. David Burt: The Ministry of Youth, Social Development and Seniors has been allocated $85.3 million, an increase of $1.45 million when considering the transfer of departments. This increase is primarily for
salary uplifts and new programme s to support vulnerable populations represented by this Ministry. Initiatives
include the introduction of a disability register app, continuation of the Dementia Care Services Pilot Pro-gramme, development of a five- year Domestic Abuse
Strategy, and increased grants to residential homes
and third- sector organisations serving seniors and disabled populations.
The Office of Youth Affairs will focus on National Youth Policy initiatives, emphasising child safeguarding policies for youth organisations. Ageing and
Disability Services will develop a case management
system with a focus on strengths and needs assessment. Funding has been awarded to start a new Child
Safeguarding Programme under the Department of
Child and Family Services, and additional funding has been granted to enhance the delivery of the Independent Living Programme.
Mr. Speaker , as I stated earlier, this b udget
funds our major priorities in line with the theme of investing in our people and our future.

Balancing a Budget with No New Taxes
Hon. E. David Burt: Mr. Speaker, I will now move on
to the next section, Balancing a Budget with No New
Taxes.

Yes, yes!

Hon. Walter H. Roban: Tell us how we are going to do
it.
Hon. E. David Burt: Mr. Speaker , after years of deficits, austerity, and underinvestment in our people and
our infrastructure, Bermuda was on an unsustainable
path that placed a heavy and unfair burden on Bermudians today and an even heavier burden on future generations. These issues were then exacerbated by a
once- in-a-lifetime pandemic that further increased our
debt, devastated a key economic pillar and disrupted
the very order of our society.
Mr. Speaker , in response to the hand we were
dealt, this Government accepted the responsibility of
restoring economic stability and exercising fiscal prudence during these unprecedented times. As a result,
we have positioned ourselves to deliver a budget surplus whic h not only would be the first g overnment surplus in over 20 years , but we have also reached this
milestone before the collection of any corporate income tax.

Yes! Well done!
[Desk thumping]
Hon. E. David Burt: Mr. Speaker , achieving a balanced budget in this economic climate was incredibly


Bermuda House of Assembly difficult. As the world continues to grapple with the aftershocks of the pandemic, foreign wars, rising interest
rates and continued supply chain challenges, we took
on the unenviable task of formulating a budget in an
inflationary environment amongst comp eting priorities
and limited resources. This balanced budget was
achieved with careful planning and without raising or
introducing any new taxes. In fact, we reached this balanced budget after reducing taxes for 86 per cent of the
workers and all local bus inesses in Bermuda.
That, Mr. Speaker , is how you build a better
and fairer Bermuda. Despite the picture the Opposition
tries to paint, this could only be possible through economic growth, job creation, an improving tourism industry and increased foreign investment. By implementing
policies t hat focus on economic growth instead of austerity , we have successfully reached our [ immediate]
objective and will capitalise on this achievement to ensure, as a country, that we continue to reduce the burden on working families. Think bac k to what we have
overcome. Remember how the COVID -19 pandemic
took our health, took our loved ones, took our jobs, shut down our airport, left our hotels sitting empty and had
our hospital on its highest disaster alert level. Our GDP
was declining, and the Government was borrowing
funds to provide much needed financial support to Bermudian families and businesses.
Mr. Speaker , there was no blueprint on how to
deal with a pandemic and certainly no blueprint on how
to recover from one. However, within three years we
have already begun the path of reducing our debt and
established fundamental tax reform legislation. And
with this balanced budget , Mr. Speaker, we are on the
verge of a new era.

Yes! Yes!

Sharing the Benefit of Collective Sacrifice
Hon. E. David Burt: Mr. Speaker , in 2020 at the height
of the pandemic, the Government borrowed funds to ensure Bermudian families in need could keep their
lights on and have food on their tables. At that time we
expected to accumulate $408 million in deficits prior to
reaching a balanced budget. However, due to our
sound financial management, combined with significant
economic growth, we only accumulated $322 million of
defic its over the past four years, leaving us with $89
million more in the bank than we expected just a few
years ago. Mr. Speaker , compared to just one year ago,
we are $49 million ahead of where we thought we
would be due to this Government’s prudent management of the economy and public finances.
Mr. Speaker , the funds that we borrowed in
2020 are sitting in an account earning interest, and the
law requires that they can only be invested or used to fund future deficits. However, with the advent of a balanced budget and future projected surpluses, there is
no expectation that there will be significant deficits to fund in the future. Now, Mr. Speaker, w e can look at
those figures and pat ourselves on the back, but there
remain real needs that the Government must address.
Some may say it is more impor tant to keep that extra
$89 million in the bank, allowing health care costs to go
up and allowing Bermudian cries for more affordable
housing to go unanswered. However, in this Government we have a different philosophy , and our values
built up over our 60 years of history tell us that the cries of our people must be answered.

Yes. Yes, yes. They will be.

Hon. E. David Burt: Mr. Speaker , keeping significant
contingency funds was fine for a time where a balanced budget was not a near -term prospect, for a time when
there was no global minimum tax on the horizon; but
today is different. Today we must do all that we can to
assist Bermudians who are feeling the pinch today and
who do not want a Government that will just pass on
costs to them, especially so when the Government has
the fiscal space to provide relief. Therefore, the Government intends to bring legis lation to amend the Government Loans Act to enable the transfer of funds from the excess borrowing account if those funds would not
be required to meet deficit spending.
Mr. Speaker , it is this Government’s intention
to use $40 million of the funds in the excess borrowing fund to do the following:

Freeze on Government Health Insurance Premiums
for the Third Year in a Row

Hon. E. David Burt: The first, Mr. Speaker, is a freeze
on government health insurance premiums for the third
year in a row.

[Desk thumping]
Hon. E. David Burt: Mr. Speaker , the Government’s
actuaries have advised the Ministry of Health that in or-der to keep up with health insurance claims, which continue to escalate due to our ageing population, the Government will have to increase its health insurance rates
by $45 a month. This Government cannot and will not
allow that to happen. Therefore, we intend to transfer
$30 million from the excess borrowing fund to the mutual reinsurance fund to ensure that our health funds
are able to pay claims without aski ng every resident in
Bermuda who has a health insurance policy to pay
$540 extra a year.

Yes, yes. Bravo!

[Desk thumping]
Hon. E. David Burt: What does this mean? It means ,
as I stated, that for the third year in a row this Government will freeze the standard premium rate that all
382 16 February 2024 Official Hansard Report

Bermuda House of Assembly persons in Bermuda with health insurance must pay.
This will shield residents and employers from a g overnment -mandated premium increase this year.

Additional Boost to Affordable Housing

Hon. E. David Burt: Mr. Speaker , Bermuda's economic growth is increasing affordable housing pressures throughout the I sland , and we see the pain that it
is inflicting on working Bermudians. If we were to do nothing, that problem would only get worse and could negatively impact economic growth, which will hurt the
very Bermudians challenged to find affordable housing
today. Again , we are not prepared to let that happen.
Two years ago the Government committed to investing $15 million in affordable housing. However, it is our
view that we need to go further to ensure that we pro-vide more affordable options. Therefore, the Government will invest an additional $10 million into the Bermuda Housing Corporation to accelerate the provision
of affordable housing and enable a significant expan-sion of the private sector rental programme . This will
bring more rental units online faster so that we can relieve the housing pressure for Bermudians . And, Mr.
Speaker, this is an investment in growth.
Mr. Speaker , this Government’s values demand that the people of Bermuda deserve to benefit
from their sacrifices in recent years, and with our hold-ing the line on health insurance costs and creating
more housing for our people, we will ensure that they
do. For many y ears Bermudians have been used to the
term “shared sacrifice. ” Today this Government is ensuring that there is shared benefit for all due to the many years of sacrifice required to return our country’s books to balance.

Let’s Debate Policies, Not People

Hon. E. David Burt: Mr. Speaker , over the next month,
Honourable Members will dissect the budget proposals
the Government is delivering today. Next week there
will be a R eply from the Opposition, and if the last few
years are anything to go by, they will denigrate the real
and tangible evidence that Bermuda is heading in the right direction. They will try to paint our long- standing
belief in caring for our people and prioritising workers
as an election budget . History has shown us that the
presentation we w ill hear next week will likely be laced
with personal attacks, racial innuendo, unsubstantiated
accusations of corruption, and cynical and hypocritical
accusations of friends and family schemes, all devoid
of any alternative plan for the future. That is what history shows us, Mr. Speaker.

[Inaudible interjections and laughter]

Hon. E. David Burt: We will see them wrapping themselves in the cloak of social conscience like a wolf in
sheep’s clothing, all while presenting themselves as the champion of working Bermudians when their actions in
Government revealed what they truly represent. Let us
not forget , Mr. Speaker , last year the Opposition rolled
back the main pledges in their Budget Reply before the weekend was even over.

That is right. That is right.

Hon. E. David Burt: Let us not forget that His Majesty’s
Loyal Opposition called for a new tax on health care, a tax that would have driven up the cost of health care
and inflicted pains on Bermudian families. And next
week they will try to present themselves as having
some sort of new -found social conscience. The Opposition called for the reintroduction of the travel authori-sation fee to further drive up the cost of travelling to
Bermuda and inflict further pain on our tourism industry and on Bermudian families. They rolled that back too,
Mr. Speaker. And t he Opposition spoke against the
payroll tax changes that we made which reduced the burden of payroll taxes for 86 per cent of the workers in
this country and every local business in Bermuda. They called them, Mr. Speaker, irresponsible. Imagine that!
Cutting taxes for 86 per cent of the people in the country and every business they brand as irresponsible.
We understand why they took the side of some
business groups in opposition to our giving relief to
hard- working families, as in 2016 they raised payroll
taxes on workers to the highest level in Bermuda’s history, inflicting hardship on many in Bermuda. And yes,
Mr. Speaker, w e have heard the MAGA rhetoric from
the OBA .

[Laughter]

Hon. E. David Burt: And hearing it with a Bermudian
accent does not make it any more appealing or less repugnant. Accusing political enemies of everything under the sun with zero evidence, dog- whistle narratives
and claims about saving Bermuda. The truth is that beyond opening the immigration floodgates, raising taxes
on workers and reducing investment in public services,
they have no plan.

No plan!

Hon. Walter H. Roban: No, plan, Mr. Speaker! None!

Hon. E. David Burt: They will try to downplay the
achievement of a balanced budget, even though they
could not do it and know full well the positive impact it
will have for our people and our country. They will try to
downplay the fact that international business employment has hit the highest level in Bermuda’s history.
And, Mr. Speaker, this is a new one. They will say that
we need to make Bermuda a place of yes and not a
place of no , and yet at every turn when the Government
advances a matter, they will say no. No to vertical farming, no to tax reform, no to the Fairmont SDO [special


Bermuda House of Assembly development order] , no to taller buildings in Hamilton.
They will even say no to a food truck in Flatts !
Mr. Speaker , they are the party of no, more interested in protecting the status quo and in the preservation of the elite and privileged than in supporting ac-tion that will benefit hard- working Bermudians. They
are more interested in opposing than in providing an
alternative. They talk out of both sides of their mouth,
all the time thinking that our Bermudian people will for-get about their record, their behaviour and their approach during their disastrous single term in office.
Mr. Speaker , when I say “talk out of both sides
of their mouth, ” let us take the example of the Former
Premier and Shadow Minister of Public Works (my
good friend, by the way, Mr. Speaker), —
[Laughter]

Hon. E. David Burt: —who recently declared that the
Bermudiana Beach should be a housing development
and not a hotel. Mr. Speaker , this Government inherited
that property with a change in plan to convert it to a
hotel that the former Premier himself came up with! The
plan that he created in 2015 was to turn the site into a
hotel, and when we came into office, that is how we found it.
Now, Mr. Speaker , could we have changed it
to public housing in 2018? Absolutely, and with the ben-efit of hindsight, especially given the housing conditions
in the country today, it is arguable that we could have
chosen a different course. However, it is important to remember that the housing market in 2018 was completely different where there were many vacant apartments to rent. So I am not going to deny that this project
has cost more money than we wanted it to have done;
however, let there be no doubt t hat we will deliver a
successful hotel that will create jobs and will boost our
tourism economy.
Now, let me go on, Mr. Speaker , because I
want to speak to another issue that the C ombined Opposition likes to peddle, and that is accusations of corruption. Over the last six years we have achieved high
international rankings due to our work, diligence and
focus on making sure that Bermuda is a premier anti -
money laundering jurisdiction. We are globally recognised to have strong rules, low corruption and the operational independence of our police, judiciary, prosecution services and financial regulator. Therefore, Mr.
Speaker , it is galling that the Opposition, who did not
invest the needed attention to these assessments and had multiple scandals involving government ministers,
would attempt to cast a veneer of corruption when there
has never been a single shred of evidence at any point
in time in any way , shape or form of impropriety from
members of this Government.
Mr. Speaker , enough is enough! If we are to
have a real policy debate and build our country for the
future, we must stop with the silly and false innuendoes
of corruption. We have an independent police service that is empowered to investigate such crimes , and it is
not under the control of the PLP Government, but under
the control of the United Kingdom. If the OBA believes
for one second that the UK Government would ignore
any impropriety by any member of this PLP Govern-ment, they are fooling themselves . Or maybe they are
simply attempting to mislead Bermudians.
So here is what I am saying, Mr. Speaker. The
Opposition talks a good game, but in reality they seem
to have little or no concern for the country ’s future. It
will denigrate the reputation of the country by peddling
WhatsApp rumour and innuendo, and we all know the
reasons why —to gain power so they can change the
rules to ensure that persons of their choosing are
granted status, to ensure that taxes on working people
are raised again, and to ensure that there is a reduction
of investment in public services which will impact the
vulnerable and the middle class. Mr. Speaker, it is their
people who are saying, Reduce government expenditure, not me.
Mr. Speaker , we challenge the Opposition next
week to come to this House and say exactly how many
jobs they will slash in the public service to fulfil their
promise of —and I quote —“reduce Government expenditure . . .”. We challenge them to tell Bermudians
what social programmes or grants they will purge. They
may choose not to tell us, but their history speaks
louder than whatever they are claiming today or will
claim next week.
Mr. Speaker , our people deserve more than
just platitudes from the Opposition, consultant -driven
slogans and vague words like back to basics. If they
want to govern this country, then they should tell the
voters exactly what they will do and not try to scurry
away from their own words and deeds the weekend after they announced them when they found out how unpopular they are. Mr. Speaker, our Progressive Labour
Party Government may not always get it right . I am the
first to admit that. We get that. Human be ings make
mistakes. B ut our hearts are in the right place with our
Bermudian people.

Yes! That’s right.
[Desk thumping]

Hon. E. David Burt: Where we have gotten it wrong,
we humbly apologise and commit to learning, growing,
listening and serving the people even better.
Mr. Speaker , with our balanced budget setting
the stage for a prosperous future, we can look ahead with optimism and the people of Bermuda can have
confidence that when it comes time to make budgeting
decisions, this Progressive Labour Party Government
will always pu t the needs of Bermuda’s workers first.
[Desk thumping]

Looking to the Future

384 16 February 2024 Official Hansard Report

Bermuda House of Assembly Hon. E. David Burt: Mr. Speaker , this is a budget for
the future. This is a budget that invests in our people so
they can achieve success. It is a budget that begins to
restore our roads to their proper state. It is a budget that
meets the Fiscal Responsibility Panel’s target of deliv-ering a $50 million surplus by fiscal year 2026/27. It is
critical to note that th is Government has projected this
outcome without the benefit of the new global minimum tax.

Corporate Income Tax

Hon. E. David Burt: With that being said, Mr. Speaker ,
and as this presentation today is the beginning of our
general economic debate, and as budget presentations
include projections for the next three years, it would be
remiss of me if I did not share the initial projections from the Ministry of Finance based upon what the country
can expect in the future following the implementation of
the corporate income tax [ CIT] developed to address
the Global Minimum Tax requirements.
Now, Mr. Speaker , I do not want us to get carried away , because there could be a delay in the implementation of the Global Minimum Tax . There may not
be significant tax revenues that accrue initially, and it
remains to be seen what the final recommendations
from the Tax Reform Commission will be. However, it
is undeniable that there is expected to be an additional source of revenue that wil l accrue to the Government
of Bermuda, and as we are debating how our country
should go forward, I am happy on behalf o f this Government to present our initial views for the next two fiscal years.
Let me say at the outset that I know that there
are those who will criticise the Government for looking
forward. But in my opinion, that is mere politics. I say
that, Mr. Speaker, because i f we are to be open with
the people who send us to this Honourable House, then
we must present a picture of how we view the future.
Those Bermudians who have made sacrifices under a
tax system that many consider unfair and are challenged to make ends meet need realistic hope and confidence that things can and will get better . And they
need to not just hear words, but to see how we will get
to that place of relief. As I have said in this Honourable House on numerous occasions, Mr. Speaker, there will
be no meaningful reduction in the cost of living in Bermuda without significant tax reform. Any politician who
says otherwise is not being truthful.
Mr. Speaker , that time has now come, and the
corporate income tax is the start of significant tax re-form. The Tax Reform Commission, chaired by Mr . Darren Johnston, will be presenting a set of recommendations on how best to distribute the benefits of the additional revenue and the guardrails that must be put in
place given that revenues from the corporate income
tax may be variable. The c ommission will also be making recommendations on what should happen with any
funds that are in excess of what is estimat ed to be collected in any given year and how funds received can
be used to reduce Bermuda’s long- term debt.
Mr. Speaker , that brings me to my next point.
Last year, in my opinion, the Opposition tried to seize
headlines and divert attention from the corporate income tax debate to discuss what should be done with
the excess revenues. This was done under the guise
that if nothing is done, any government has free access
to spending excess revenues. Here is the problem with
that formulation, Mr. Speaker. No funds that have been
collected by the g overnment can be spent unless they
have been appropriated by this Honourable House.
That is right, Mr. Speaker. T he amendment meant
nothing because if there were excess revenues over
and above what may accrue in any given year, those
revenues could not be spent without an Act of Parliament or a resolution of this House. So, Mr. Speaker ,
given that fallacy has now been laid to rest, let us look
to the future.

Corporate Income Tax Projections

Hon. E. David Burt: Mr. Speaker , the estimates of CIT
revenue that have come to the Ministry of Finance and that have been shared with the Tax Reform Commission are that the Government should expect to receive
on average at least $750 million in additional revenue each year and that ini tial tax payments on account from
the CIT could commence by July 2025.
Mr. Speaker , earlier I presented the mediumterm expenditure framework for the next three years for
the consolidated fund. And as I said, t his demonstrated
that the Government would achieve the $50 million surplus recommended by the Fiscal Responsibility Panel.
However, with the advent of the Global Minimum Tax ,
there is the expectation that the Government will receive additional revenue.
Even if the G overnment were only to receive
half of the estimated cash inflows that our advisors have stated could come to Bermuda in the next two fiscal years (that would equate to $187.5 million in fiscal
2025/26 and $375.0 million in fiscal year 2026/27),
there will be significant additional funds. It is important that we adopt a conservative mind- set toward additional revenues , as there are many uncertainties, especially with the package of qualified refundable tax credits that will be recommended by th e Tax Reform Commission and the Government’s stated view that companies in scope of the Global Minimum Tax will not be
liable for employer payroll taxes.
Notwithstanding, Mr. Speaker , there are urgent
needs in our community: the need for tax relief for workers and businesses ; the need for investment in our infrastructure; the need for relief from high electricity and
food prices ; and most importantly, Mr. Speaker, the
cost of health care. Given the Tax Reform Commission
is doing its work, it would not be fair in light of the countless hours of work they are dedicating for me to provide
specific numbers , as we genuinely await their


Bermuda House of Assembly recommendations . But I want to make sure that I provide an indication of what the future is likely to hold for
our residents and our businesses.

Fiscal Year 2025/26

Hon. E. David Burt: First, the fiscal year 2025/26,
which is the next fiscal year. Mr. Speaker , if the $187.5
million of CIT revenue is available in fiscal year
2025/26, it is this Government’s view that we must take
care of the most pressing issue that affects the most people, and that is the cost of living. The Government
is committed to implementing universal health care ,
and it will be important to seed a new health insurance
fund with an injection of capital. This will benefit all residents and busines ses in Bermuda, as reduced health
insurance costs make Bermuda’s economy more competitive. Additionally, there is the immediate need to reduce the burden of taxation, which directly feeds into
higher prices.
There will be the opportunity to reduce or eliminate customs duty on fuel imports, which could save the average household up to $300 a year. Food and
other necessities are expensive, and though the Government has eliminated duty on 33 staple goods and
food categories, there are hundreds of other essential
items where duty can be eliminated that will result in lower prices. Another important consi deration for customs duty , Mr. Speaker, is the cost of construction,
which is driving increases in home insurance policies.
Mr. Speaker , earlier I spoke about the need to
boost capital expenditure up to 2 per cent of GDP, and
it will be vital that additional funds go to infrastructure to progress projects that have been delayed due to our pursuit of a balanced budget.

Fiscal Year 2026/27

Hon. E. David Burt: With expectations of at least $375
million of additional revenue [in fiscal year 2026/27],
there will be the ability to provide even more relief. With
this increased revenue, there would be the ability to fur-ther support health care, which will further reduce the
burden on families and businesses, and invest even
more funds in capital upgrades, which may see Bermuda reach the 2 per cent capital investment target ,
while providing even more relief to tackle the cost of
living and the cost of doing business. Our goal is to deliver relief to those struggling to keep up, and we will
deliver on that commitment.
One of the challenges in operating a business
in Bermuda is employer payroll tax, which is a tax on
employment. By fiscal year 2026/27 there will be the
capacity to lower employer payroll taxes to reduce this
burden on employers, which can only assist in bringing
down the cost of doing business while boosting eco-nomic growth. The revenue expectations for fiscal year
2026/27 should allow for even wider reductions in customs duty. These further reductions will assist not only consumers but also our local reta ilers, as they will be
paying less money upfront for the importation of the highest volume of goods, which means that they can
be more competitive.
Another critical need that must be considered
is Bermuda ’s social insurance system. State pensions
around the world are challenged as populations age and people live longer, but there is an opportunity for
these revenues to support the topping- up of the contributory pension fund to minimise the increases re-quired on businesses and residents to make the fund whole.

Ensuring Fiscal Responsibility

Hon. E. David Burt: Now, Mr. Speaker , these are the
possibilities based on conservative estimates of revenue from the global minimum tax. However, the Tax
Reform Commission will be making recommendations
on how to ensure that we can smooth tax collections
and the best manner to invest and deploy funds received. As we have only estimated 50 per cent of what
government advisors said we could expect to receive,
should the collections meet or exceed the estimates,
there will be excess revenues above what is budgeted
for in a single year. Therefore, Mr. Speaker, it is important that the Government will continue its prudent
and considered approach to debt management, reco gnising the significant impact of interest expense on our
budget.
Although the next tranche of debt does not mature until 2027, the Government will collaborate with its
advisors to as appropriate, and subject to the recommendations of the Tax Reform Commission, channel
excess cash flows to the early repayment of debt. It is
the intention of this G overnment to bring legislation to
this Honourable House in next year ’s budget session to
enshrine the recommendations of the Tax Reform Commission. This will ensure the excess funds received from the global minimum tax are invest ed and
preserved for future years with the necessary protec-tions so that they can benefit all Bermudians.
Mr. Speaker , I have set out the Government ’s
position so that stakeholders in this country understand
the direction of travel. It is one of fiscal responsibility and appropriate collaboration married with the need to
ensure that we reduce the cost of living and reduce the
tax burden on the hard- working men and women of this
country. Our position will also ensure that we increase
investments in infrastructure and provide affordable
health care to all Bermudians, and that our social insur-ance system exists f or future generations.

Pension Fund Reform
Hon. E. David Burt: Mr. Speaker , as we think about
future generations, we must recognise that as a result of persons living longer and the [number] of benefits
paid not matching the level of contributions, there are
386 16 February 2024 Official Hansard Report

Bermuda House of Assembly significant actuarial funding gaps in the Government ’s
Public Service Superannuation Fund [ PSSF ]. Mr.
Speaker , these gaps have been highlighted on several
occasions by the Government and its advisers as a key
issue that threatens the very solvency of these funds. The urgency of this matter is amplified as it becomes
increasingly difficult to reach a solution as t ime goes on
and the gap increases.
Mr. Speaker , over the last few years, the Government has been working with the Public Funds Investment Committee to reform our pension system. I am pleased to announce that following consultation
with our public sector unions, the Cabinet has now approved the recommendations for revisions to the PSSF,
to which the unions have given broad support to ensure
this fund is sustainable into the future while reducing
the contingent liability on the consolidated fund.

[Desk thumping]

Hon. E. David Burt: Mr. Speaker , whilst we are
pleased to advance the sustainability of the PSSF, the
Government continues to advance its consultation regarding the necessary amendments that will also make
the contributory pension fund (commonly known as so-cial insurance) sustainable. Similar to the PSSF, the
recommendations will include some variation of an in-crease in retirement age and increases in contributions. The funding gap for the contributory pension fund is a
larger and more difficult issue to resolve given the rapidly ageing population and persons living longer, mean-ing they draw more benefits over time. However, we are
confident that we can achieve a solution that will ensure
social insurance benefits are there for future generations.
Earlier , Mr. Speaker , I indicated that the topping-up of this fund could be a prime candidate for revenues that may accrue to the Government from the corporate income tax. This is not my idea, Mr. Speaker,
but a suggestion that has come to the Government as
part of the ongoing consultation with our local and international business representatives. The rationale is a
good one —that social insurance is for all persons in
Bermuda and is a critical need for long- term stability.

Improving Government Services

Hon. E. David Burt: Mr. Speaker , the theme of this
year’s Throne Speech was Service to the People, and
in order to better serve the people we must improve the
delivery of g overnment services.

Investing in Information Technology

Hon. E. David Burt: Mr. Speaker , Honourable Members are well aware that the Government was the target
of a malicious and deliberate cyberattack in September which severely crippled government systems. Before I go further, I would like to pay tribute to
the dedication of the public servants who worked diligently not only to repair the damage but also to deliver
public services under extremely trying conditions with-out the computer systems that would normally be used to deliver those services.
Over the past few years the Government has
significantly ramped up capital spending to invest in its IT infrastructure. The [accompanying] chart shows that
since coming to office we have significantly boosted IT
capital investment. However, this level of increase was not enough , and we must redouble our efforts to ensure
that the Government can be better protected in the future as cyber threats continue to increase. While we are
rebuilding our systems to be more resilient, we must
also make sure that we are investing in new technologies that can enable us to deliver government services
more effectively.

Artificial Intelligence

Hon. E. David Burt: Mr. Speaker , recent years have
represented significant advances in artificial intelligence [AI]. It is incumbent upon the Government to harness this technology and to invest in education and training for public officers so they can utilise artificial intelligence to deliver public services more efficiently. Mr.
Speaker , during the Throne Speech the Government
committed to improving public services, including the
customer service experience that those who interact
with the government have. There is no doubt that artificial intelligence can assist us in delivering that goal, and this b udget funds a digital transformation team that
will work to roll out artificial intelligence- powered improvements to government services.
The Government has targeted the first department that will benefit from AI -powered services to be
the Department of Immigration. Working with a local company that has implemented successful artificial intelligence- powered processing for local insurance companies, we will utilise similar technology to aid in the vetting of applications to ensure that frontline workers
can be reassigned to other more complex tasks that will
increase the efficiency of the department.
I would like to thank the Association of Bermuda International Companies [ ABIC ] for answering
the call to assist the Government of Bermuda by iden-tifying a partner to advance this Government ’s ambitions and ensure that we deliver public services more
efficiently. Former Premier Alex Scott said, “Bermuda
works best when we work together ,” and there can be
no better example of working together than using the
local expertise that powers our global insurance industry to improve the efficiency of public service delivery.
Mr. Speaker , it is important to note that artificial
intelligence is not a method to replace workers, but a
tool to enhance the productivity of our dedicated public servants so that they can serve the people of Bermuda
better. Continued deployment of artificial intelligence in


Bermuda House of Assembly government departments will not only enable us to
serve the people of Bermuda more efficiently, but as our economy continues to expand it will reduce the pressures of hiring additional persons to complete the various tasks of government.

Increased Use of Cloud Computing
Hon. E. David Burt: One of the lessons from the
cyberattack was that our on- premises systems cannot
always reliably be maintained, especially when there is
a lack of continuous infrastructure investment. This
budget also funds the moving of the g overnment ’s email systems to the cloud with modern applications to
ensure that in the event of any future attack, the government ’s core email system will still function and we
will be able to communicate. Artificial intelligence sys-tems require that data be in the cloud , and the increase
in funding to IDT [Department of Information & Digital Technologies] will commence that process this year.

Reducing Regulations to Boost Economic Growth

Hon. E. David Burt: Mr. Speaker , in alignment with the
strategic initiative from the Economic Development
Strategy , Ensuring Bermuda Is Business Friendly , and
its associated action item , Reduce outdated regulation
that may hamper business expansion, it is vital that we reduce red tape to speed the delivery and approvals of
government services. The aforementioned AI initiative
will assist, but AI can only go as far as the regulations allow. In that regard, the Government has on numerous occasions reached out to private sector organisations
to ask them to submit suggestions regarding regula-tions that could be streamlined or reduced to boost economic activity.
Unfortunately, Mr. Speaker, the response has
been limited, a nd therefore , the Government is going
directly to the public. In March we will launch a consultation on forum.gov.bm
encouraging citizens to share
their experiences with what they would consider unnec-essary red tape, as this Government is committed to making government work better.

Reform of the Public Service

Hon. E. David Burt: And finally, Mr. Speaker, reform
of the public service. Mr. Speaker, to ensure we deliver
better public services we must accelerate reforms to the public service. I would like to thank the longtime Head of the Public Service, Dr. Derrick Binns, who re-tired last year, for commencing the initiative of public
service reform. Our new head of the public service, Ms.
Cherie-L ynn Whitter, has hit the ground running and is
advancing a number of the reform initiatives which are
necessary to ensure that government can perform bet-ter.
One such initiative being completed is the upgrading and modernis ation of the Public Service Commission Regulations. This is necessary to ensure that line managers in departments and ministries can better manage their staff. There are many processes that currently take too long in government, whether that be hiring or disciplinary. These changes will streamline these processes while adhering to Bermuda’ s existing
Constitution Order to ensure that the Go vernment ’s
mantra of service to the people can be deliv ered.

Acknowledgments
Hon. E. David Burt: Mr. Speaker , before I conclude my
presentation today, I must thank the persons who made this balanced budget possible. I stand here as a repre-sentative of this Government and, though I deliver the
speech, many others have done the work. I wish to pay homage to the ministers and the public service execu-tive, the heads of department s and the ministry controllers who have laboured to ensure that we complete the Estimates of Revenue and Expenditure in good time. I
would like to thank Hono urable Members of the Government backbenches who have held the Govern-ment ’s feet to the fire, ensuring that the priorities of the
Government match the feedback from the doorsteps. I
would like to extend a special thank you to the Members of the Budget Office, led by the Budget Director ,
Ms. Tina Tucker (who is with us today), who work with
ministries to ensure budget control.
I certainly thank also, the Junior Minister of Finance, Senator Arianna Hodgson, and MP Jache Ad-ams who have worked tirelessly to assist me in produc-ing this year’s Budget Book. And also I must thank the Communications Team, who ensure that the docu-ments are printed and delivered on time.
Mr. Speaker, I would also like to thank our u nion partners who have made sacrifices over the years to ensure that we can achieve this balanced budget to-day. It has not been easy, as for many years public of-ficers have worked in departments that have been un-derstaffed, under -resourced, and have often work ed
with old and outdated technology. They have borne the brunt of the discipline which has been necessary to re-turn our budget to a balanced one, and I thank them for their collaboration as we have navigated the last six
and a half years together.
Finally , Mr. Speaker , I want to give special
recognition to someone who has provided invaluable support to myself, certainly to the former Minister of Fi-nance, to this Government and to this country. For the
last three years, Ms . Cheryl -Ann Lister, OBE, has
served this country as Acting Financial Secretary, step-ping into the role due to untimely circumstances , but as
she has done time and time again in her career, she
answered the call to service. During this time she has mentored the team and reorganised t he ministry so that
it is fit to face future threats to this country , and has
done it all with her firm but loving demeanour. Ms . Lister
will be stepping down from the role at the end of March,
388 16 February 2024 Official Hansard Report

Bermuda House of Assembly but during her three years she has left an indelible mark
within the Ministry of Finance.
So, Ms. Lister, on behalf of this Government
and Honourable Members all here, I want to thank you
for your hard work, guidance, selflessness, expertise and commitment to our country. You are a gem to us
all, and I look forward to your continued advice as you
support and mentor your successor.

[Desk thumping]

Hon. E. David Burt: And yes, that was not in the draft.

Conclusion

Hon. E. David Burt: Mr. Speaker , so often in political
service we must devise words to inspire the people we
are elected or appointed to serve, but words are cold
comfort to those who are confronted with the realities
of life in a challenging economy. In this b udget, Mr.
Speaker , the Government demonstrates that beyond
words there are endeavour and commitment. We have
delivered results to the benefit of Bermuda and its people, and those facts speak for themselves. The promises we made have been delivered, and where not delivered are well in train. Mr. Speaker , those results have
now positioned us to go from strength to strength.
Mr. Speaker , there have been late nights working and poring over figures and consistent canvassing
to hear directly from the people. And we have listened.
We have applied fiscal discipline guided by a focus on equity and fairness and a determination to put Bermudians first. It is a humbling experience to see vision become reality . And through the investments we make in
this budget , that reality will become one of broader success among more and more Bermudians. This work is
not for the sprinter ; it is a mar athon, demanding discipline and focus.
Mr. Speaker , we have invested in building our
economy . We have sacrificed to balance our budget .
Now we must expand our investment in Bermuda’ s
greatest asset, our people, to build that bright future.
So, Mr. Speaker, it is my honour and privilege o n behalf
of this Progressive Labour Party Government and on behalf of all of the members and supporters who have
continued to keep the faith with us during this difficult
task of returning our country to the path of stability and
prosperity, I proudly comm end the Estimates of R evenue and Expenditure for Fiscal Year 2024/25 to this
Honourable House.

[Desk thumping]

Thank you, Mr. Premier.
Mr. Premier, I believe that it is customary that
all other business for the day is carried over. So with that, it is the opportunity to move us to a close for today.
How is that?
ADJOURNMENT
Hon. E. David Burt: Thank you, Mr. Speaker.
Mr. Speaker, I move that this Honourable
House do now adjourn until the date of Friday, February 23.

Members, before I close the House this
morning, I would just like to acknowledge some in our
Gallery this morning. We have with us visiting from one
of our sister islands, the [Diaspora] Ambassador Dr.
Christine Walwyn. We also have the Senate President
with us this morning, Ms. Joan Dillas -Wright, and the
other Senators who are present with us here today.
Welcome.

[Adjournment, continuing]

And we look forward to a very robust debate as we proceed along with the presentation that
was presented today, next week. For those in this
Chamber and those listening, next week we will have
the Reply from the Opposition Leader, and we will start the open discussion around the particular matters for
debate for the forthcoming budget.
Members, enjoy your week. And look forward
to being prepared for next week.
Thank you.

[Gavel]

[At 12:19 pm, the House stood adjourned until
10:00 am, Friday, 23 February 2024.]