The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government will likely find it “quite necessary” to produce a revised 2021-2022 Budget that reflects its policy priorities and campaign pledges, a well-known accountant is predicting.

Craig A. ‘Tony’ Gomez, the Baker Tilly Gomez managing partner, told Tribune Business that passing a supplementary Budget would have to be done quickly given that the fiscal year is almost three months’ old.

Suggesting that modifications will be made as the newly-elected Davis administration gets to grips with the public finances and state of the Public Treasury, he added that a supplementary Budget could also be facilitated by bringing the mid-year Budget statement - typically given in February - forward by several months.

“I think it’s going to be quite necessary for them to at least amend and produce a supplementary Budget,” Mr Gomez told this newspaper. “The Budget reflects their ideas and way of taking the country forward. It would be a reflection that they are thinking the same as the previous government’s thinking if they were to entirely keep the previous Budget.

“By way of example, in a household, while the family has one direction to achieving their goals, it’s not always that the mother’s way of handling the budget is the same as the father’s way of handling the budget. The end game is to get the Budget in a better position, and The Bahamas in a better position and back on its feet.”

Many observers believe the fiscal realities, with a $10.4bn national debt now greater than the size of the economy, and a $953m deficit for the 2021-2022 fiscal year that will add to $2.2bn worth of borrowing during the previous two fiscal years, will prevent the Davis administration from being able to deliver on much of their pre-election promises.

Tribune Business columnist, Hubert Edwards, previously argued that a supplementary Budget was unlikely given the Government’s limited fiscal headroom. He suggested that while money could be repurposed and reallocated within the existing fiscal framework approved by Parliament, there was little to no scope for further borrowing beyond previously agreed limits.

Mr Gomez, though, argued that a revised Budget would serve notice of the Davis administration’s intent and seek to distinguish itself from its predecessor. Dr Michael Darville, minister of health and wellness, yesterday said extra funding must be found for the public healthcare system to enable it to cope with COVID-19.

He added: “This government is going to have its own interpretation of how to achieve its aims and make The Bahamas a better place. If the system allows, I think we’ll find that as the Government sits down and has a closer view of what’s in the Treasury, and timelines for getting The Bahamas back into full business, we’ll see modifications to the Budget and a supplementary Budget.

“It has to be done quickly. The Budget is already three months old, but a modification is not unusual. It’s likely we’ll simply see it earlier, and they may bring the mid-year Budget forward. There has been a significant change, and that significant change is a change in government and perhaps a complete rethinking of the financial model used by the previous government.”