Mr. Speaker, on Tuesday, 28th February 2023, I laid the 3rd Supplementary Appropriation Bill for FY 2022/23 in this Honourable House and today I rise to Table the same. And I am doing so with Galatians Chapter 6, versus 9-10 as my guide. It states:
"Let us not lose heart in doing good, for in due time we will reap if we do not grow weary. So then, while we have opportunity, let us do good to all people, and especially to those who are of the household of the faith."
Mr. Speaker, I want to assure you, and most importantly the people whom we work for (i.e. the beautiful people of these beautiful by nature Turks & Caicos Islands), that we have not lost heart in doing good for you. As a matter of fact, Mr. Speaker, when it comes to doing good for our people, we are getting stronger and stronger.
If this was church Mr. Speaker, I’d say “Can I get an Amen?”.
Mr. Speaker, with this Supplementary Appropriation Bill we are seeking to vary an allocation of $18.0M from previously approved projects and utilize it towards what we deemed as “critical government priorities” before the end of the financial year, which is fast approaching.
Mr. Speaker, through this Supplementary, there will be a $2.2M net increase in allocation for the Development Fund, taking it from $53.5M to $55.8M.
Mr. Speaker, the Critical Government Priorities for the remainder of FY2022/23 are:
1. The Citizens Empowerment Fund, which will be seed funded with $7.0M, to be used to establish a Credit Union – i.e. National Credit Union.
Mr. Speaker, I won’t go into all of the details now about the National Credit Union, as it is the brainchild of the Premier, and I will give him the privilege to speak to it in detail at a later time. However, the benefits of a government-funded Credit Union for the Turks & Caicos Islands include:
a) Increased Access to (affordable) Credit: A government-funded Credit Union can provide access to affordable credit for its members, including small businesses, particularly those that are currently having a difficult time accessing credit from the three main commercial banks in the country, or affordable credit from the other institutions. The Credit Union will help stimulate economic growth in the country and promote financial stability for its members.
b) Financial Education: The National Credit Union will help individuals and families better manage their finances and make more informed financial decisions.
c) Community Development: The National Credit Union will help foster a sense of community by providing a platform for its members to come together and support each other. The members will also be able to invest in local businesses, thereby allowing them to have a stake in the development of the islands.
d) Democratic Governance: Credit Unions are often governed democratically, with members having a say in how the organization is run. This can promote transparency, accountability, and trust between the Government, the Credit Union, and its members.
e) Government Support: Government funding for the National Credit Union will provide financial stability and ensure the long-term viability of it. This will help the National Credit Union better serve its members and contribute to the overall economic development of these islands.
Mr. Speaker, the benefits of having access to affordable credit for MSME (Micro, Small, and Medium Enterprises) businesses, an area that falls under the Ministry of Finance, are:
1. Expansion and Growth: Access to affordable credit allows MSME businesses to expand and invest in new opportunities. This can lead to increased revenue, profits, and job creation.
2. Increased Competitiveness: MSME businesses that have access to affordable credit can invest in technology, equipment, and other resources that help them stay competitive in their markets.
3. Improved Cash Flow: Affordable credit can help MSME businesses manage cash flow and cover operational expenses, such as payroll and inventory.
4. Diversification: With access to affordable credit, MSME businesses can diversify their products and services, reducing their reliance on a single revenue stream.
5. Improved Creditworthiness: Regular, on-time repayments of affordable credit can improve a business's creditworthiness and increase their chances of receiving additional credit in the future.
Mr. Speaker, access to affordable credit is essential for the success of MSME businesses, enabling them to expand, improve their competitiveness, manage cash flow, diversify their products and services, and improve their creditworthiness. This can lead to increased revenue, profits, and job creation, benefiting both the business and the broader economy.
In addition, Mr. Speaker, there are several benefits of having access to affordable credit for households, particularly for single-parent households. These are:
1. Financial Stability: Affordable credit can help single-parent households achieve financial stability by allowing them to cover unexpected expenses and make important purchases, such as a home, car, or essential household items.
2. Improved Living Conditions: Access to affordable credit can help single-parent households improve their living conditions by allowing them to make repairs or upgrades to their homes, purchase new appliances or furniture, or even move to a safer or more suitable home.
3. Improved Education and Training: Affordable credit can help single-parent households invest in education or training opportunities that can lead to better job prospects and increased their income over time.
4. Debt Consolidation: Access to affordable credit can allow single-parent households to consolidate high-interest debt, reducing their monthly payments and overall debt burden.
5. Improved Credit Worthiness: Regular, on-time repayments of affordable credit can improve a household's credit score, making it easier to access credit in the future and potentially lowering interest rates.
Mr. Speaker, access to affordable credit is essential for the financial stability and well-being of single-parent households. It can help improve living conditions, provide opportunities for education and training, consolidate debt, and improve credit worthiness, all of which can lead to increased financial security and a better quality of life.
As you have heard Mr. Speaker, the TCI Government seed funding the National Credit Union will provide significant benefits to these Islands, by increasing access to affordable credit, promoting financial education, fostering community development, and promoting democratic governance.
2. Investments in roads and electrification across the islands, which will receive US$5.0M in this Supplementary.
Mr. Speaker, there will be several benefits from our Government investing in roads and electrification. These include:
1. Improved Connectivity: Investing in roads and electrification can improve connectivity between different parts of the islands, thereby making it easier and faster for people to travel.
2. Increased Economic Development: Improved infrastructure will attract new businesses and industries to these islands, leading to increased economic activity and job opportunities for our people.
3. Enhanced Tourism: Investing in roads and electrification will make our islands more attractive to tourists, leading to increased tourism revenues and job opportunities in the tourism sector for our people.
4. Improved Quality of Life: Better roads and access to electricity will improve the quality of life for our people by providing access to essential services and making it easier for them to access education, healthcare, and other services.
5. Increased Resilience: Investing in roads and electrification will make these beautiful by nature Turks & Caicos Islands more resilient to natural disasters by improving access to emergency services and facilitating the evacuation of people in the event of a disaster.
Overall, Mr. Speaker, our Government prioritizing investments in roads and electrification will have a range of positive impacts on the economy, society, and environment. It is expected to lead to increased economic development, enhanced tourism, improved quality of life, and increased resilience to natural disasters. In summary, Mr. Speaker, investing in roads and electrification is a good thing.
3. The implementation of our Government’s Housing initiatives, which will receive $3.0M.
Mr. Speaker, the benefits of our Government’s Housing initiatives will include the following:
1. Social Stability: The Housing initiatives will contribute to social stability by reducing the risk of homelessness and ensuring that vulnerable people have a place to live.
2. Economic Growth: Affordable housing programmes can contribute to economic growth by creating jobs in the local economy.
3. Improved Health Outcomes: Having access to safe and affordable housing can improve health outcomes by reducing the risk of exposure to environmental hazards for vulnerable people.
4. Reduced Government Spending: Providing affordable housing will reduce government spending by decreasing the need for emergency services, such as shelters and hospitals, and reducing the costs associated with inadequate housing.
5. Improved Quality of Life: Affordable housing can improve the quality of life for vulnerable populations by providing stable housing that is safe, secure, and affordable. This can help to reduce stress and anxiety and improve overall well-being.
Overall, Mr. Speaker, our Government’s Housing initiatives is expected to have significant benefits for both individuals and the islands as a whole.
4. The procurement of a new I.T. platform for the Exchange of Information (EOI) department, which will receive $2.0M.
Mr. Speaker, I spoke about this on Tuesday past, but I will recap it again for this honourable house, last October – i.e. October 2022 - the European Union (EU) added our Islands to its blacklist of tax havens, claiming that we are non-cooperative on matters related to tax. While we disagree with the findings, we do recognize that we are deficient in some areas, particularly around the I.T. platform that facilitates the collection of required information and the exchange of that information.
As such Mr. Speaker, we are procuring a new IT platform, which will allow our jurisdiction to have a more robust automatic exchange of information solution. The benefits of this will be:
1. Increased Legitimacy: The new I.T. platform will reenforce our commitment to international tax standards, and most importantly show that we are indeed a “cooperating partner” with the EU for tax purposes, which will go a long way towards improving our reputation as a responsible financial center.
2. Improved Compliance: Automatic exchange of information will help to improve overall compliance by registered entities, as it will make it more difficult for them to avoid meeting the reporting requirements.
3. Enhanced Transparency: Automatic exchange of information will increase transparency and accountability for our jurisdiction, which will help to remove the perception that we are “non-cooperating”.
4. Avoidance of Sanctions: By complying with international tax standards, we will accelerate our removal from the EU “blacklist for tax purposes” and avoid us being put back on it in the future.
5. Maintaining Competitiveness: By complying with international tax standards, our jurisdiction will become more competitive in the global financial market, as we will attract new investors and clients that are looking for a stable and reliable financial center.
Mr. Speaker, as this is your industry, I am sure you are aware that there are several potential benefits for our jurisdiction doing everything that we can, in a responsible way to grow our market share in the global financial market. However, for the benefit of this honorable house, I will list them. They are:
1. Increased Economic Activity: A growing financial industry will help to increase economic activity in our Islands by creating jobs, attracting investment, and increasing demand for our services.
2. Increased Revenue: A growing financial industry will help to increase government revenues through taxes, fees, and other charges associated with financial activities.
3. Diversification of the Economy: A growing financial industry will help to diversify the local economy, reducing our heavy reliance on tourism, construction, and the stamp duties.
4. Enhanced Reputation: A growing financial sector will help to enhance our reputation as a stable and reliable financial center, which will attract more investors and increase confidence in our jurisdiction.
5. Improved Infrastructure: A growing financial industry will also help to improve overall infrastructure, including technology, and telecommunications, which will have positive spillover effects on other industries.
All in all Mr. Speaker, growing our market share in the global financial market will have significant benefits for our jurisdiction, including increased economic activity, revenue, diversification, reputation, and infrastructure.
Mr. Speaker, to recap from Tuesday, funding for the aforementioned priorities will be made available through:
1) A reduction in allocation for the S.I.P.T and associated trials by $1.5M, as it is projected that the allocation for the FY will not be fully utilised.
2) A reduction in the Contingency Fund by $3.0M, as it is underspent.
3) A reduction in the allocation for land acquisition by $1.5M, as it is not projected to be utilised in this financial year.
4) Cancelling or Deferring $8.0M in Development Fund projects, as those identified projects will not be advancing to the commitment stage before the end of the financial year. Mr. Speaker, the priorities that are being deferred will mainly be funded in the upcoming financial year.
With that Mr. Speaker, I now invite this Honourable House to debate the 3rd Supplementary Appropriation Bill 2022-2023.