The Tribune

By NEIL HARTNELL

Tribune Business 
Editor

nhartnell@tribunemedia.net

High-ranking officials who are entitled to a new car every three years at taxpayer expense have been kicked on to a vehicle leasing programme as part of the Government’s drive to cut spending, it was revealed yesterday.

Michael Halkitis, minister of state for finance, made the disclosure to a Bahamas Association of Compliance Officers (BACO) conference to illustrate how the Christie administration was finding public sector cost savings.

Explaining that the Government had adopted the philosophy of ‘let’s justify every single thing’ in its bid to turnaround the precarious fiscal situation, Mr Halkitis said: “We’ve done some things internally to cut the rate of expenditure.”

He identified the move to lease vehicles, rather than purchase them outright, as one such cost-saving measure.

Emphasising that the beneficiaries of these vehicles were civil servants, and not politicians, Mr Halkitis disclosed: “Some officials, as part of their contract, get a new vehicle every three years.

“We felt if we did a leasing programme it would be less expensive, bringing the car back to the dealer every three years.”

Apart from the obvious cost savings, many Bahamian taxpayers are likely to wonder why their dollars are being spent on such seeming ‘perks’, especially at a time when the Bahamas is seeking to extricate itself from a fiscal hole.

Meanwhile, Mr Halkitis said the Government’s call last year for all agencies to cut spending by 10 per cent was “by and large successful”. He added that the cuts achieved were in the range of “8 per cent or so”.

Adding that the Government had also been able to save money via an audit of its communications systems and equipment, Mr Halkitis said the Christie administration had gone through every line item in the Budget “with a fine tooth comb to really get a handle on expenditure”.

When it came to the Government’s planned Value-Added Tax (VAT), Mr Halkitis acknowledged that both the Bahamian private sector and the Government would have some adjusting to do.

“Once we implement there will be a period of adjustment and tweaking; it won’t be perfect in the first go,” the Minister conceded, although he reiterated the July 1, 2014, deadline for its implementation.

“I can assure you the Government will take the necessary steps to ensure it will be implemented successfully,” Mr Halkitis said.

“It is the case that implementation has been unsuccessful in some countries, and they have had to start afresh, but we believe we have learned from those experiences... A lot of the groundwork and heavy lifting has been done.”

Promising that Excise Tax rates would be reduced from their “relatively high levels” currently with VAT’s arrival, Mr Halkitis said the Government had narrowed down to four the number of bidders seeking to supply the IT system and support for VAT.

And he added that the Government would “beef up” the existing 12-person strong VAT implementation unit as the target date grew nearer.