The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government was yesterday urged to exempt all businesses impacted by the New Providence Road Improvement Project from their 5.9 per cent share of National Insurance Board (NIB) contributions for a year, with some describing the proposed micro loan and BEC concessions as “meaningless”.

Small business consultant Mark Turnquest, whose Robinson Road business was itself impacted by the project’s road closures, suggested that the Government make NIB contribution relief and the proposed micro loans of up to $10,000 a “mandatory” part of its relief programme.

He added that components such as a 10 per cent reduction on Bahamas Electricity Corporation (BEC) bills for 18 months, and 60-day Customs Duty deferments for six months, should be granted on a “case-by-case” basis depending on the nature of the business.

Others, though, were less optimistic. Ethric Bowe, spokesman for the Coconut Grove Business League (CGBL), described some parts of the Government’s offer as “meaningless”, and added: “That cannot be defined as compensation.”

He said the CGBL and others were crafting a counter-proposal that “won’t cause any damage to the Treasury”.

Central to this is a suggestion that the Government issue Customs credits to all impacted businesses - those closed and operating. These could then be traded and sold between the various firms, enabling those still closed to gain cash that might help them re-open.

However, Mr Turnquest said: “Based on the position of the country with reference to the debt and lack of money, that’s the best they can do.

“All we can do is follow the procedure, get what is due to us and move on. What happened in the past, we can’t correct. Just take the money and do our best to establish some kind of business effort. We can only get what we can get.”

Again calling for the Government to consult with the private sector and conduct impact assessments before undertaking such major infrastructure projects again, Mr Turnquest said the situation had reached the point of “Monday morning quarterbacking”.

“I like what they’re giving small businesses, but that’s basically after the fact,” he added. “It’s too late for those businesses already closed. The best thing they can do is compensate them for what they owe in payables.”

When it came to the maximum $10,000 micro loan per business that the Government is proposing, Mr Turnquest said this should be “automatic” for firms still in business. As for entrepreneurs looking to re-open, he suggested the loan should be applied to sums they still owed.

He also argued that the Government should exempt impacted businesses from the employer’s 5.9 per cent share of NIB contributions for a year - something that is expressly not included in the relief plan.

“Mandatory should be the soft loan and 5.9 per cent NIB exemption for a year, and then consider the concessions from BEC and consider the Customs duty exemption,” Mr Turnquest told Tribune Business.

Stipulating that the relief programme would start on December 10, with applications received until January 18, the Ministry of Finance said that to participate companies much show they were in business along corridors affected by the road project when works were taking place.

Promising a quick turnaround time, the Ministry of Finance said businesses would receive a Certificate of Enrollment within 10 days to show what, and how much, assistance they would receive.

This holds out the prospect of obtaining some recompense before Christmas, as many businesses had asked for.

The assistance options include a deferred BEC payment plan, where disconnected businesses keep current with existing payments and pay-off the arrears balance over 24 months.

Customers in good standing, with arrears less than 30 days, will receive a 10 per cent rebate for 18 months, while the Government would pay 50 per cent of a closed business’s outstanding bill if this was matched by the company.

There is also a sliding scale of discounted advertising, ranging from 50 per cent to 10 per cent depending on the amount purchased, with ZNS, and 50 per cent Business Licence and real property tax rebates covering sums due over the last three years.

The micro loan facility, through the Bahamas Development Bank, is capped at $3 million. The per firm maximum is at $10,000, with the interest rate set at Bahamian Prime and lasting three years. Interest would only be paid in the first year.

And the Customs duty concession is a 60-day deferment for six months. This will be limited to $1,000 for businesses without a Customs bond or letter of credit, and up to the amount of the bond for firms possessing one.

Mr Bowe, though, told Tribune Business of the package: “That cannot be defined as compensation. I don’t know what is the true term for that, but if you look at the dictionary definition, it doesn’t fit the bill.

“Any of those things, what do they hold for Wing Zone, and companies like Wing Zone that went out of business?”

Mr Bowe said the CGBL’s counter-proposal would give the Government the means to provide the compensation it was seeking “without causing any damage to the Treasury.

“We’re not saying ‘pay us, pay us’. We’re going to provide them with the practical means to work ourselves out of this,” he added.

Central to the CGBL’s plans were for the Government to issue Customs credits, Mr Bowe explaining: “Those businesses that have no need for them can sell them to businesses that use them all the time, and that way get some of those businesses that are dead or in dire straits to come back, and stimulate the economy.”

He added, though, that the main issue for the CGBL remained converting Blue Hill Road and Market Street back to two-lane thoroughfares, as without this happening “the damage would continue”.

“Currently, it’s a matter of how you die: Painfully, in tortuous fashion by drip-drip, or kick the bucket suddenly,” Mr Bowe told Tribune Business.

He described the micro loan proposal as “meaningless”, adding that the 10 per cent BEC bill reduction “doesn’t help a business survive”.

To illustrate, Mr Bowe said a company’s whose energy bill was $1100 a month would effectively get a $110 rebate for that period.