The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

A Cabinet minister has disputed assertions by the International Monetary Fund (IMF) that up to 13,500 "informal economy" workers may have been unable to obtain COVID unemployment benefits.

Brensil Rolle, minister for the public service with responsibility for national insurance, told Tribune Business he was unaware where the IMF was getting its numbers from for the recently-published Article IV report.

“I don’t know where they are getting their numbers from. That cannot be accurate," he responded. "Certainly, anyone who was entitled to their benefits from NIB got it that we’re aware of, and certainly that I’m aware of.

"Some persons got a reduction in benefit because they were getting a percentage of their benefits from their employers. But I don't know where they [the IMF] get that. I'd be interested in looking at the statement.”

The IMF, in its full Article IV report on The Bahamas, said several thousand self-employed and other persons may not have had access to government-funded benefits because they remain outside the formal economy and make no social security contributions.

"Only self-employed workers in tourism-related businesses are covered by the unemployment benefit extension. This means that self-employed informal workers for other industries (many indirectly linked to tourism) and informal employees are not included among the unemployment beneficiaries," the Washington D.C-based Fund said.

"There are approximately 13,500 informal workers in The Bahamas. However, limited information about inter-linkages of the economy would make effective targeting beyond the tourism sector difficult." The informal economy refers to commercial activities not regulated or protected by the state, with the majority of participants in this area likely self-employed or micro businesses.

Mr Rolle, though, said the Government and NIB went so far as to provide unemployment benefits to persons who had never made a contribution to NIB. He said: "The government’s assistance went to everyone. Anyone who applied got it.

“I don't know how more informal they [the IMF] could get because we gave funding assistance to jet ski operators and hotel singers, and once you work in the tourism industry or if you're a barber or hairdresser or something to that effect, you've gotten the Government assistance.”

Mr Rolle said there were many persons who did not register at NIB, and “if they did not register in one programme we could not continue to extend them in another programme".

Calling for improvements in the efficiency and targeting of social spending, the IMF said that of all the funds dedicated to business and individual COVID-19 assistance during the final quarter of the 2019-2020 fiscal year - a sum equivalent to 1.2 percent of economic output - just 0.8 percent of GDP was ultimately expended.

"Execution fell short given limited demand for some programmes and implementation delays," the IMF said, adding that the Government's spending on Hurricane Dorian relief, as well as tax breaks granted to facilitate construction, will impose a burden on the Public Treasury equal to about 6 percent of GDP - more than $600m - spread over four years.

The Fund also identified what it described as "a duplication of services" where 15 percent of National Health Insurance (NHI) scheme beneficiaries also have private health insurance.