The Tribune

By AVA TURNQUEST

Tribune Chief Reporter

aturnquest@tribunemedia.net

PROGRESSIVE Liberal Party Leader Philip Davis yesterday knocked the government’s proposed salary tax to fund its National Health Insurance scheme as “regressive”.

Mr Davis told The Tribune the tax should have been considered in concert with the decision to increase value added tax by 4.5 percent this summer.

He insisted this latest proposal evidenced the Minnis-led administration had no grasp of what “holistic governance” means despite its pronouncements.

“It seems rather onerous and misguided for the government to consider at this time imposing two percent of person’s salary to fund NHI when you just raised VAT by some 4.5 percent,” Mr Davis said. 

“You would have thought that if you were thinking through things, and identifying what you are going to do, and having a holistic view of governance, you would have taken that increase into account. 

“If you had a true and clear vision for NHI, why go 4.5 percent on VAT and then come back with a two percent on salaries for the purposes of NHI? When considering the whole, it might have been just as prudent to say: two percent on salaries and ten percent for VAT.

“It’s the kind of thinking we expect but whenever there is no plan, where there is an ad-hoc approach to governance, when you’re operating in silos, then they often end up with unintended consequences that create regressive conditions.”

The contributory scheme, announced by the National Health Insurance Authority on Tuesday, proposed that the salaries of every employed Bahamian will be subject to a deduction of about two percent each month as a means to pay for universal healthcare coverage for all, including children, elderly, and the unemployed.

It proposes people already subscribing to private insurers will not make any extra contributions but instead two percent of their payments to these insurers would go into the universal healthcare pool.

Mr Davis yesterday pushed back against the Free National Movement’s characterisation of the PLP’s scheme, which flagged free healthcare at the point of service as a defining element, could not be funded.

He said the former administration’s phased approach was always meant to be refined after it was tested.

“We decided to go with tertiary and primary healthcare first,” Mr Davis said, “and promoting healthy lifestyle to start the curving the attraction of communicable diseases which will in turn lessen exposure to catastrophic illness. 

“There was a plan as to how we were going to phase it in, our funding mechanism I thought would have worked. At the end of the day, years down the road, we may have had to consider whether it was sustainable but we needed to see it working first.”

Mr Davis added: “I think it’s regressive at this time to tax the Bahamian public any further. It’s just regressive. When we were considering NHI, the manner of funding it was high in the consideration. How it was going to be funded, looking at the allocations from the consolidated fund, and all the other expenditures in the system. 

“It was thought there would be no necessity to tax the Bahamian people immediately in respect to that, and we wanted see how it evolved to see whether it was a necessary imposition. We were loathe to put any further taxes on the Bahamian people particularly after we introduced the VAT.”

Health Minister Dr Duane Sands has flagged the ongoing funding crisis affecting the country’s healthcare industry for several months, most recently challenges at the Princess Margaret Hospital’s Dialysis Unit.

In September, the Public Hospitals Authority pointed to “very little funding” for the maintenance and renovation of the country’s healthcare facilities in response to union calls for an expansion of the salaries and benefits of medical personnel.

Yesterday, Mr Davis added: “But they can find $65m to sink into an elephant in Grand Bahama? There is always no money but they can find money to do things that truly don’t make sense. It’s how you manage what you have, I don’t think their managing resources to get maximum benefit for the people, particularly the ordinary people.”

He was referring to the government’s purchase of the Grand Lucayan resort in Grand Bahama. 

The FNM’s NHI policy paper outlines several timelines, including April to July 2019 for the launch of the standard health benefit and NHI expanded coverage; July 2019 for a sugary drink tax and national wellness programme; a January 2020 launch of the employer mandate/two percent deductions for businesses with 100 or more employees; and January 2021 employer mandate expansion for all employers and deadline for all grandfathered private insurance plans.

The authority has embarked on a 45-day public consultation with stakeholders.