Government presenting the letters, from left: Curtis Richardson, Cora Richardson-Hodge, Chief Minister Victor Banks, Evans McNiel Rogers and Cardigan Connor.
ANGUILLA–At a press meeting this week Chief Minister Victor Banks said he had received a letter from Lord Tariq Ahmad, the UK Minister of State and Overseas Territories, stipulating requirements before the sixty-million-pound-sterling grant is released. Banks called it “fiscal engineering” and said it should not be required as the grant is a humanitarian one for rebuilding after Hurricane Irma. He read the letter and his reply.
Lord Ahmad, in his March 13, 2018, letter to Banks, stated that he wanted to disburse the 60 million pounds of recovery funds as soon as possible, and was willing to disburse some funds for high priority recovery projects based on two conditions: the preparation of a revised 2018 budget to address noted concerns no later than March 31, 2018; and a commitment to prepare a revised medium-term economic and fiscal plan.
His terms and conditions included proposals to increase revenue streams through increased Customs duty collection, stabilisation levy, increased service-related taxes and tourism levies. He expressed concern about import concessions granted to local and international investors and required confirmation that all expenditure estimates had been reassessed and revised if necessary to include implementing plans to cut recurrent expenditures, providing a more realistic view of debt to include a clear statement of all monies owed by the government, and a proposal to reduce the debt going forward.
Ahmad’s letter ends with notification and says, “Given the risks of default, one of the measures being considered is the appointment of a Chief Financial Officer (CFO) and I have asked officials to begin work on preparing an order in council that would provide for a CFO who would have considerable responsibilities over the public finances of Anguilla. This is not a step I wish to take, however, I am asking officials to begin this work now so that this legislation can be enacted if needed following the submission of the revised medium-term economic financial plan if it does not meet the conditions I have specified. This step will only be taken to ensure the good governance and sustainability of Anguilla’s public finances. Therefore I strongly encourage the Government to work with the financial specialist to achieve these requirements.”
Banks read his response to Lord Ahmad which noted that mass unemployment caused by Hurricane Irma remained challenging, main access hubs into Anguilla remained in serious disrepair and Anguilla’s main economic driver, the tourism industry, still had a distance to go before normality was restored. Based on these facts, he is seeking approval of Anguilla’s 2018 budget and the release of the 60 million pounds of recovery funds committed to by Prime Minister Theresa May. Banks noted, “Once reconstruction commences Anguilla’s economy will be stimulated by employment in the construction sector and related services. The truth of this assessment is manifesting itself as we speak. In short, the remittance of the aid will, of itself, be a critical stimulant to economic growth in the territory. Furthermore, that aid has been committed in response to a humanitarian crisis, and as such its delivery should not be withheld for the purpose of fiscal engineering, particularly as these measures were not sought prior to the hurricane,” Banks said in his letter.
He elaborated that the island’s depressed revenue performance, focused principally on accommodation receipt revenue for the first two months of 2018, should not be a surprise given the impact of Irma on the tourism industry in Anguilla, and its limited recovery progress due to the lack of reconstruction aid. “The UK Government should fulfil its obligations to the British citizens of Anguilla by swiftly disbursing the humanitarian aid publically announced last year … to protect the welfare of its British citizens from the consequences of last year’s catastrophe and the increasing potential risks of the forthcoming hurricane season. Humanitarian aid should not be withheld for the purpose of fiscal engineering. Increased proposed taxes at this time are morally wrong and should not be a prerequisite for the receipt of humanitarian aid already promised,” he said.
The Chief Minister strongly noted numerous examples of the UK’s total lack of monetary support to Anguilla, a British Overseas Territory, and its apparent lack of knowledge of the country and its culture. Additionally, he strongly rejected the concept of a CFO assigned to Anguilla, stating that Anguilla “reserves the right to refer the matter to the appropriate institutions for objective scrutiny to ensure the protection of the welfare of the people of Anguilla, should the need arise.”
Banks’ written response was copied to the Prime Minister, the Foreign Secretary and the Secretary of State for International Development. He ended the press conference by stating that officials in the Ministry of Finance were engaged in responding to and ensuring that the raised concerns were addressed and negotiations moved forward to positively increase and disburse available funding for Anguilla.
Source: The Daily Herald https://www.thedailyherald.sx/islands/74954-government-given-conditions-to-meet-before-release-of-60m-grant
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