Deputy Prime Minister and Minister of Finance, the Hon. Peter Turnquest gives the FY2020/21 Budget Communication, May 27, 2020 in the House of Assembly. (BIS Photo/Patrick Hanna)
Nassau, The Bahamas - Deputy Prime Minister and Minister of Finance the Hon. K. Peter Turnquest explained that it will be no surprise that the 2020/21 Budget is largely defined by the economic emergency that has been thrust on The Bahamas by the Coronavirus (COVID-19) Pandemic, and the still rippling economic impact of the monstrous and catastrophic Hurricane Dorian.
“Together, these events have delivered the fastest, deepest economic shock to The Bahamas since the onset of the Second World War. Needless to say, these events have forced us to shift to a new course of action,” DPM added as he presented the 2020/21 Budget Communication.
He said COVID-19 has increased pressure on Government revenues, and on public expenditure. “It has suppressed our export sector; temporarily shut down our domestic economy; and dramatically slowed our short-term prospects for economic growth. This comes on the heels of an economy that was already just slowly recovering from a catastrophic hurricane.”
Because of current realities, the DPM noted that the landscape the nation has operated in has completely changed.
He said it demands a different approach and a different set of solutions from the Government. Even though its ultimate objective has not changed — to achieve sustainable growth for both the medium and long-term, in The Bahamas — the Government’s short-term strategy and overall thinking about the future has had to shift.
“Today, I will do my best to clearly detail our immediate plan for restoration, including our vision, our strategy, and the solutions we propose, so that the Bahamian people can fully understand the significance of the 2020/21 Budget.”
DPM Turnquest stated that while many countries are now on the precipice of economic desperation, fortunately, The Bahamas has been held up as a model in the region for its effective management of the crisis, particularly for the compassionate care of people, and structured re-opening plan.
He added that the unpredictable impulses of this highly contagious and deadly virus have tested and shaken the foundation of even the largest and most well-resourced nations of the world. But here in The Bahamas, the response, although not without stumbles, has been remarkably comprehensive, targeted, compassionate and effective.
DPM Turnquest said, “I am proud to say on this Budget morning that this Government did not waver in responding to the needs of the Bahamian people from the onset of this pandemic. For the three months to June, we allocated over $140 million in our policy response to COVID-19. As many would be aware, this response included:
- Providing direct social assistance through the food and unemployment assistance programs,
- Supporting employee retention with tax credits and deferrals directly to support the non-executive payroll expense of impacted medium and large businesses,
- Extending business continuity grants and loan support for small businesses,
- Increasing funding allocations to the public health sector to ensure its readiness for the detection, treatment and mitigation of the virus, and
- Expanding subventions to the utility companies to support the bill payment waivers offered to impacted persons.”
He said to illustrate the extent of the Government’s initiatives, as of mid-May, the National Insurance Board (NIB) paid out some $6.2 million for the Government funded unemployment assistance program.
The DPM explained that the Government created this program to assist self-employed individuals, who would not normally be eligible for an unemployment benefit from NIB. Under the standard Unemployment Benefit Scheme, NIB also paid out $28.8 million in benefit claims to those laid off as a result of the virus. This has covered just over 26,000 people since the end of March.
He noted that for the business community, 284 small businesses were approved for loan financing – representing a collective $19.4 million in funding. Similarly, the Government advanced a business tax credit and deferral initiative to minimize further private sector job losses. The Department of Inland Revenue approved 44 companies, who collectively benefitted from some $5.7 million in tax credits and deferrals. These Government loans, grants and deferrals have protected roughly 5,400 vulnerable jobs.
DPM Turnquest said with respect to the health situation, the Government has expended $3.1 million to construct a new COVID-19 support unit at the Princess Margaret Hospital, at the Rand Hospital, as well as additional beds at the Grand Bahama Cancer Association to accept overflow patients depending on the need.
Please view link to the FY2020/21 Budget Communication, presented today in the House of Assembly by Deputy Prime Minister and Minister of Finance, the Hon. Peter Turnquest.