The Tribune

By LEANDRA ROLLE

Tribune Chief Reporter

lrolle@tribunemedia.net

THE government is seeking to borrow $300m for national development objectives, including infrastructure projects, according to Prime Minister Philip Davis.

He tabled several borrowing resolutions after delivering his mid-year budget communication in the House of Assembly.

One resolution would approve the repayment of all loans borrowed by the University of The Bahamas (UB).

UB is seeking to borrow $25m from the Bank of The Bahamas to support its accreditation process. A precondition of the loan is that the government will repay any portion of the $25m that UB cannot repay.

Additionally, Mr Davis gave notice of a resolution approving the government’s guarantee of a $75m loan for the Public Hospitals Authority (PHA) from a banking consortium led by CIBC.

Another resolution seeks approval for the government to guarantee a $10m loan from the Bank of The Bahamas for the Bahamas Technical and Vocational Institute (BTVI) to support its accreditation efforts.

Mr Davis also gave notice of a resolution approving the government’s guarantee of all outstanding loan repayments under an agreement between a special purpose vehicle (SPV) and Scotiabank.

According to the resolution, the government plans to incorporate an SPV — either fully state-owned or under the Water and Sewerage Corporation — to secure a $50m loan for acquiring, upgrading, and expanding Family Island water production operations.

Mr Davis said the country’s fiscal situation has shown signs of sustainability.

He said tax revenue collections had increased, reaching $1.3 billion in the first six months of the fiscal year, the highest tax revenue collection ever recorded for this period.

On the expenditure front, he said preliminary total expenditure for the first half of the fiscal year was $1.8b, an increase of $278.3 million over the previous year.

He said the government’s total expenditure has accounted for 50.9 percent of the annual budget target, which is in line with budget estimates.

He said recurrent expenditure for the period made up 49.5 percent of the budget target, totalling $1.6b. Recurrent spending increased by $192.3 million year-over-year.

He attributed the increase in expenditure to several factors, including higher subventions to public non-financial corporations and a $16.9m rise in compensation for employees, bringing the total to $434.6 million.

He also noted a $94.8m increase in spending on goods and services, which reached $346.6m, or 50.4 percent of the annual budget target. He said payments for rent, utilities, the acquisition of services, and special financial transactions drove this increase.

Public debt interest payments were also higher, increasing by $34.3m to total $335.5m, representing 51.1 percent of the budget target.