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House Agrees To Borrow $100m For Emergencies

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

THE House of Assembly approved a resolution yesterday to borrow $100m from the Inter-American Development Bank as a contingency against natural disaster emergencies.

The loan was previously approved during the 2018 budget exercise and is only now being put into operation, Deputy Prime Minister and Minister of Finance Peter Turnquest said.

Prime Minister Dr Hubert Minnis said the contingent loan facility “is a line of credit that is on standby in the event the country is hit by a hurricane and needs additional funds to respond and to recover”.

“This is a facility that we as a country hope never to have to use,” he said. “By design and by our own government policy, this is not monies that can be accessed to do anything other than to respond to natural disasters.”

Previously, the government announced it will use money from extinguished dormant accounts to set up an independently managed disaster relief fund, legislation allowing for which is expected to be brought to Parliament. Dr Minnis said that fund will be seeded with about $41m at inception.

He also noted the administration re-enrolled in the Caribbean Catastrophe Risk Insurance Facility, a regional insurance fund that the Christie administration exited after determining the country had little chance of receiving a payout because of how the scheme was structured. The Minnis administration has re-structured the scheme although the opposition still disputes its value.

“Taken together,” Dr Minnis said, “these will ensure that there is an ample source of cash readily available to the government so that it can respond quickly. The government is then better positioned to save lives and secure property. Once the event has passed, this will mean that the government can more readily mobile the contractors and vendors to get the country back to a state of normalcy.”

The Progressive Liberal Party voted against the contingency loan resolution. Opposition leader Philip “Brave” Davis said he did not understand what “natural disaster emergency programme” meant based on language in the loan agreement.

He said the agreement explicitly disallows the money to be used to fund infrastructure repairs of permanent structures. “What will happen to my school when it goes down in Cat Island?” he asked. “What is to happen when the roofs are removed because of water and rain? They are permanent structures.”

He said: “Much ado was made about the fact that our administration decided to withdraw ourselves from the CCRIF insurance. They went ahead and said they would fix it. A hurricane came. They went in and said a new provision was introduced by the CCRIF organisation where they got a little something which was not even as much as the premium. Why you need to have a contingency fund to draw on if you have an insurance? Now, I know you might say there are some deductibles. But is it going to be $100m?”

Mr Turnquest later countered that money from the CCRIF programme will be used only to fund infrastructure repairs while the contingency fund will cover ancillary costs. He said the multiple plans are all about enhancing the country’s climate change resilience, an area environmentalists have found to be lacking.

He said: “Rather than wait for an event to happen and then scurry around wondering where we will find $100m to borrow for recovery, we know with surety where that money is coming from. The protection of that fall back line of credit costs us nothing in the interim so it is actually free insurance if you want to call it.

“...We are taking a prudent and responsible approach to try and cover all the potential risks that exist as best as we can to ensure that in the event of an emergency, we have CCRIF to cover the infrastructure costs and with this credit line we cover all the other costs associated with the risk of a hurricane.”

Comments

joeblow 6 months, 2 weeks ago

Seems kinda stupid to borrow money you have to pay interest on to have it sit JUST IN CASE there is an emergency, while you tax people into poverty!!

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Gotoutintime 6 months, 2 weeks ago

Valentines Day is coming! Have to take care of the Ladies!

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bogart 6 months, 2 weeks ago

PREVENTATITIVE.....MEASURES...............BEFORE HURRICANE .......CLIMATE CHANGE....FLOODING....AR RISK STRUCTURES.....ROADWAYS.....AT RISK INFRASTRUCTURE.......needs to be changed to brcome safer prior to hurricane and damages......dig canals to capture forseen floods.....lessen cathostrophe...condemn structures at high risk ...low gradient shores buildings.....strengthen electric grid to core areas to resist chaos.......strengthen core routes to access critical facilities.....IMPLEMENTING MEASURES TO LESSEN DISASTER......is better lowering disaster caualties likely BEFORE.........THAN odder civil servants sitting on dere hands ..waiting...waiting.........waiting........an then impending Hurricane...climate change...after...disasters......AND DEN SPEND $100 MILLION DISASTER FUNDS AFTER DISASTER.......protective remedy is better reduce before ....than ....full disaster afterwards...

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BahamaPundit 6 months, 2 weeks ago

This loan needs to be watched like a hawk.

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BahamaPundit 6 months, 2 weeks ago

Let's hope it is kept strictly for emergencies.

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The_Oracle 6 months, 2 weeks ago

Define "Emergency" By definition, Government is a "natural disaster" and always has been.

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bogart 6 months, 2 weeks ago

.....will there be priority "Emergency" and "natural disaster" to existing low level subdivisions like flood prone Pinewood area or say illegally dense populated shantytowns....??.

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