The Teachers’ Resource Centre was the scene of a well-attended public forum, on Tuesday evening this week, on the dire financial and economic situation in Anguilla on Tuesday evening this week and on how to find a way out of the fiscal difficulties that have overtaken the island.

Ministers: Kenneth Harrigan, Victor Banks, CM Fleming and Evans Rogers. Dr. Aidan Harrigan speaking on financial situation. Ken Hodge in background

It was arranged by the Government with a number of technical personnel from the Ministry of Finance in attendance to deliver presentations similar to those they gave in the House of Assembly.

Those who crowded the Centre included representatives of the business community anxious to see a window of hope, opportunity and recovery for the island, and candidates contesting next year’s general election. The over 3-hour forum followed the passage of three motions in the House of Assembly to enable the Government to borrow large sums of money to meet various financial needs but which still have to be approved by the Secretary of State in London under the borrowing guidelines.

Chief Minister, Osbourne Fleming, told those at the forum that it was important for the Government to update them on the financial situation of Anguilla as was given at the House of Assembly on 4th and 7th September. “We felt that a number of business persons and persons from civil society might not have had the opportunity to hear the presentations made by the technicians in the Ministry of Finance [on Friday, 4th September],” he stated. He thanked Minister of Finance, Victor Banks, and his staff, for preparing the report on the financial situation of the island to enable us “to understand where we are and probably to put our heads together [on the matter], recognising the financial crisis all over the world including Anguilla.”

Mr. Banks said the purpose of the presentation was in response to a number of things being said in the community regarding the financial situation and the Government’s decision to borrow money. He stated that although the Government was continuing to meet its commitments, the time was fast coming when there would be difficulties in doing so. He pointed out that Anguilla has had a period of strong growth since 2004 but from 2008 there had been a decline as a result of a shortfall in revenue. Among the reasons he gave were the closure of the Flag Temenos project, a slowdown of the Viceroy project and the coming depletion this month end of the Government’s reserves which were being used to meet the shortfall in revenue.

Ministry of Finance personnel and various forum attendees

Mr. Banks referred to the need to borrow money and said that the situation facing the island required the united support of the people of Anguilla. “It is not a political issue, but an issue that will have social and economic consequences for Anguilla, and therefore it means that we have to put politics aside and respond to the issue,” he added.

The technical personnel selected to present the financial situation of the island in the House of Assembly on Friday, September 4 and again on Tuesday evening, September 8, at the Teachers’ Resource Centre, included Kalleesha Webster, Deputy Accountant General, Anthea Ipinson, Chief Projects Officer, Kathleen Rogers, Permanent Secretary, Finance, Perin Bradley, Trade and Investment Officer, along with Dr. Aidan Harrigan, Permanent Secretary Economic Development, Investment and Finance, who provided explanations on various matters and Carl Harrigan, Adviser to the Ministry of Finance, who spoke on guidelines for borrowing.

Deputy Accountant General, Kalleesha Webster, disclosed that expenditure had exceeded revenue and by the end of August only 76% of the revenue estimated for the year had been collected; and there was a growing deficit of 70 million dollars by year end. She stated that at the beginning of the year there were reserves of 35 million dollars which had now declined to 4.7 million as a result of being used to meet current expenses. She reported that personal emoluments for government workers were 10 million dollars a month. According to her, the overdraft facility of 20 million dollars from the National Bank of Anguilla was also being depleted.

Miss Webster, also reported that from September to December the Government would spend 21.7 million dollars on capital projects. Debt-servicing of 3.5 million for the same period was also a factor to consider.

Perin Bradley, Trade and Investment Officer, who spoke on the Government’s financial options on Friday, said the loan of 49 million dollars which was being sought, was intended to pay the Government’s overdraft of 20 million dollars, take care of some other debts, top up the reserve fund and pay outstanding loans owed to CCB and NBA to the tune of 7.4 million. He said a 20 million dollar loan from the Eastern Caribbean Financial Holdings would be used to finance the required safety end at the airport and the balance of 24 million, from the European Development Fund, would go towards the Government’s reserves.

Section of attendees at forum

Mr. Bradley also stated that a loan of 895,000 dollars from the Caribbean Development Bank would go towards the insurance premium for hurricane Omar relief, the Hospitality Institute and other expenses. He stated that 10 million dollars owed to the Government locally was being pursued and there was a proposed Customs surcharge increase of 20% which would provide between 1.5 and 2 million dollars in revenue.

Carl Harrigan devoted his presentation on Friday and again on Tuesday on the borrowing guidelines. He reported that up to 2007 the Government had met all the borrowing guidelines. At that time the reserves were at 40 million dollars. By 2008 the figure had fallen to 36 million and by year-end the remainder would be 8.4 million.

Anthea Impinson, Chief Projects Officer, gave a rundown of the expenditure on capital projects. She reported that 21.9 million dollars was all that was left to continue work for the remainder of the year.

Permanent Secretary, Dr. Aidan Harrigan, who filled in some of the details during the presentations in the House of Assembly, and at the forum, commented that the global depression was the worst since the Great Depression. He said everyone was suffering and it was therefore not surprising that a small territory like Anguilla with 15,000 people would also be suffering.

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