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Economy 'Still Struggling From 2008 Crisis'

By AVA TURNQUEST

Tribune Chief Reporter

aturnquest@tribunemedia.net

THE country's sluggish economy is still struggling to make a turnaround from the Financial Crisis of 2008, according to officials at a recent public forum.

Tonya Adderley, Project Manager of the PFM/PMR explained that growth has been sluggish and unemployment continues to be high, and within this context, the country has seen its borrowing to sustain its deficit spending increase significantly.

The Public Financial Management and Performance Monitoring Reform (PFM/PMR) Project Unit within the Ministry of Finance is mandated to improve the government's capacity to manage and allocate resources and as such will have a tangible effect not just on the public service but also on the lives of every Bahamian.

To better explain the impact of the project, the PFM/PMR Project Unit hosted a Public Forum at The University of The Bahamas in the Performing Arts Centre.

Ms Adderley said, "Our escalating debt is a great threat to our fiscal future. Governments can approach this crisis in two ways: by increasing revenue through taxation or by reducing expenditure."

The PFM/PMR Project is the Government's apparatus for expenditure side of the deficit equation.

This is a five-year $33 million effort financed through a loan from the Inter-American Development Bank.

Ms. Adderley explained the PFM/PMR will increase the Government's capacity to manage and allocate resources in a prudent manner that ensures value for money for the Bahamian people. The PFM/PMP Project will establish mechanisms to improve and effectively implement government policies through programmes and projects.

"It will increase accountability of managers with respect to their contribution to the performance goals of the country. It will also modernize several of the information technology systems within the public sector, creating new job requirements and streamlining functions within Government."

Each of the persons responsible for the various components within the project gave a brief overview of their areas during the forum.

Component one of the project involves Performance Monitoring, which will create centralized planning infrastructure to monitor priority projects and programmes of the government.

This approach will increase cross-agency coordination, reduce duplication of effort and curb wasteful spending by ensuring that priority projects receive the human and financial resources required for success.

Component two of the project National Statistics meets the demand for high quality, timely relevant data from government, private sector, academia and civil society by creating a national statistical system.

It will facilitate the integration of research base reporting and evidence based practice into private and public decision making.

Component three of the project is Public Financial Management, which will completely overhaul the nation's public financial system to ensure that matters related to the public purse are handled efficiently and effectively. It will close the gaps in systems through business process re-engineering and strong legislative actions.

Ultimately, due to public financial reform and the implementation of project deliverables, The Bahamas should improve its standing globally through the improvement of specific performance indicators represented by our baseline.

Lastly, component four, Public Procurement, will commence the modernization of a national procurement system in line with international best practices.

National Public Procurement will become more transparent, inclusive and competitive to ensure that effective contracts provide the best value for money for the Bahamian people.

Ms. Adderley said the project is not a public relations exercise, or simply purchasing new technology.

"It is a transformational change for the public sector. The project structure is uncommon in the public sector in that it has a steering committee comprising of department heads from key government agencies across the service guiding and supporting the project implementation unit."

"It has a devoted team of professionals whose sole focus is to ensure that deliverables and timelines are met within scope and costs. Inclusion and transparency are part of the core values of the PFM/PMR Project. It impacts not only the public sector -- business, academia and civil society are tangibly affected by the decisions and systems that government chooses to implement."

Ms Adderley said: "We recognize that such changes do not take place in a vacuum. We are committed to public consultation, to collaboration and discourse to ensure we meet the needs of the Bahamian taxpayers to whom government is ultimately responsible."

Comments

bogart 1 year, 1 month ago

Trust yinna to seek foreign help to find out what is connon knowkedge.

Almost 1 billion in loan money is tied up in bad loans. 4000 mortgage accounts have failed. Wuth usually two persons pet account being husband and wife to meet TDSRtotal debt serbvce ratio of 45% of income. Persons are still working trying to salvage homes. Those homes which ate sold are sold at a loss but because the indemnity insurances may have not been adequate as a condigion of lending remaining outstanding balances enforced by LEGAL JUDGMENTS are used. IN freeport morygage loand are undereater a term used that the pror valuation in the good days has now dropped and the mortgagors are repahing loans not worth the value

Given that appraisal valuatoons have dropped because ghe glut of unsold houses, damages from lack of repairs the market is down. Coumpounding the problem is that lrnders have tightened ghe losn rrquirements so fewet are q ualifying versus when the applications were easy to qualify and not so rigorous with now credit risks depts etc.

The 45% debt atio is still used from some 25 years ago even though not one sinhle expense yhe applicant has is any lower. While interest rates have dropped but customers home ownrtsjip rates have increased fewer can qualify versus the past where an srgument can be made that morygages were easy to qualify because of predagory lenfing or the lendrs did not give a damn as the banks still had the house to sell and customet by Court Judgment to repay any shortgage. Loan officers were also given cash bonuses or win SUVs for giving out the most loans. Loans targets are now used to bring in loans. Foreign head and quedtions can be made as in whose interest they operate. Whose interest does our Centrsl Bank serve.etcetc

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Investigations are needed and where banks are neglient ot failed due care and attentoon to the mortgage customets the fines sjoild be in the billions as the effects of their pllicies have been disasterous as the Committee is finding out.

It takes two parties one is the bank and the other the customer. 4000 joint customers could not have all been wrong.

Institutional slackness has caused derisking, and decrease of foreibn banks wanting to do business not the customer. Our offshore banking has decreased.

Investigations are needed and inefficient officials fired or jailed as their actions or inactions have put the ecpnomy in this position.

Separation of the Bank Supetvision Section of the Central Bank should be made and they shojld also do the audit of banks.

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