Bermuda Post

Wednesday, Feb 24, 2021

Bermuda Government Press Conference - Ministries of Public Works and Labour January 25th 2021

Lt. the Hon. David Burch, Minister of Public Works and the Hon. Jason Hayward, Minister of Labour
JASON HAYWARD:

Good day to members of the media and the listening public.

I am joined here today by the Minister of Public Works. Lt. Col. David Burch.

In today’s press conference I will share with you the Ministry of Labour’s policy proposals in support of Bermuda’s economic development. I will also provide an update on the Wage Commission’s living and minimum wage initiative as well as the Unemployment Insurance Program to be established for the future.

Immigration

Firstly, let me speak about Immigration.

You should know that Immigration has been used globally as a tool to develop societies by bringing in the right people at the right times. For example, the 1-Year Work from Bermuda policy was brought to the fore as a result of the onset of the COVID-19 pandemic. It attracts persons who don’t take jobs but instead contribute to the island’s economy. The right people at the right time.

While we may not always agree with the way this tool should be used, it is imperative that it be used to stop the bleeding and to help move toward rebuilding an economy that benefits all Bermudians.

The Bermuda Department of Statistics’ report: Bermuda’s Population Projections 2016 – 2026 provides valuable insight as we consider Bermuda’s immigration policy moving forward. This 2018 report made clear the need for Bermuda to ‘take action’ given the projected demographic shifts for 2016 – 2026.

These projected demographic shifts have significant implications for Bermuda’s future. In summary:

Bermuda’s population is expected to decline as the number of deaths exceeds births;
There will be a continued shift in the island’s age structure as the population ages; and
Bermuda’s evolving demographic profile will have fewer children, an older workforce and more seniors.
In order to combat the harsh realities resulting from a population decline we need positive Net immigration; that is less emigration or people leaving the country to live elsewhere, and more immigration or people entering the country to live.

It should also be noted that once a small segment, older residents are now an expanding portion of Bermuda’s population. The implications of this aging population will result in an increased financial burden on the Government further exacerbated by the decrease in the number of working people.

As we know, a high number of skilled and talented workers who contribute to the economy by way of paying taxes, paying rent, purchasing houses etc. benefits the economy. In that vein, the aim of this immigration policy is to increase opportunity for Bermudians and to help improve Government’s current fiscal position.

To put is plainly, the current reality is that Bermuda is in serious financial trouble. According to the Minister of Finance, the 2021 deficit of $295 million is unsustainable. The steadily declining population was exacerbated by the exodus of many work permit holders. It is important to note that population levels cannot naturally adjusted in a timely fashion and therefore immigration policy is required.

Progressive immigration policy will help increase our workforce helping to ensure sustainable economic growth and retention and expansion of the working population thereby supporting economic growth.

If we do not use immigration as a means to support economic growth we risk falling off a fiscal cliff which will prevent the Government from providing for Bermuda and her people in the way to which we have become accustomed.

If Bermuda is going to better her fiscal situation, we must all embrace the bold steps needed to confront this situation.

Immigration Policy Proposal

In this regard, the Minister of Labour has or is embarking on the following:

Implementation of the Economic Investment Certificate that entitles a person to reside in Bermuda while contributing to the economic development of the Island.
Amending the current policy requiring Bermudian parents to prove domicile for children born overseas. This will make it easier for children born abroad to obtain Bermuda Status enabling them to take up permanent residency at some point.
Continuing with the One-year Work from Bermuda policy which has yielded nothing but positive results with over 530 applicants approved and interest from businesses wishing to set up their business in Bermuda on a long-term basis.
Increasing visitor stays from 90 to 180 days in an attempt to partially offset the drastic decline in tourism. Already we see visitors wishing to reside in Bermuda longer than the 180 day period.
As indicated in the 2020 Speech from the Throne, seeking provisions to support normalized residency of long-term residents who consider Bermuda their home but cannot call Bermuda their home.
Additionally, the Immigration Reform Working Group will be looking to consider issues surrounding Bermuda Status

These initiatives may be considered bold to some; however, maintaining the status quo will undoubtedly bring about an untenable situation for Bermuda and her people.

These proposals provides immediate solutions to addressing Bermuda’s declining financial position whilst other tools, such as increasing the birth rate, diversifying the economy, etc. require significantly more time to reach a sustainable level.

The Wage Commission

Secondly, the Ministry can advise that the Wage Commission continues their work in determining the requirements for a basic standard of living in Bermuda, and will recommend the minimum hourly wage and on the living wage rates to be prescribed by the Minister. The Current Wage Commission is chaired by Mr. Cordell Riley.

A Report pertaining to a minimum wage is expected by the end of February 2021, while a subsequent report on a living wage is expected in the next fiscal period.

Upon receipt of the reports from the Wage Commission, the Government will review the recommendations and considerations with an aim to table in Parliament a wage bill that will establish a statutory minimum wage and a national living wage.

The establishment of minimum and living wage rates will help support families that are struggling because of low wage rates that do not allow them to cover their basic needs such as housing and food. Bermuda’s high cost of living and decades of stagnant wages gives an even greater need for the establishment of a decent wage rate. It is no doubt that the current economic crisis has increased wage disparities leading to greater levels of income inequality. It is time for Bermuda to do away with starvation wages.

Unemployment Insurance Program

Last but not least, in relation to the Unemployment Insurance Program (UIP), the Ministry has invited industry stakeholders to provide feedback through the Labour Advisory Council on the implementation of the Government’s proposed Unemployment Insurance Program by Monday, February 8, 2021.

Pursuant to the Public Treasury (Administration and Payments) Act 1969, the Unemployment Insurance Fund (UIF) was established on 18 March 2002, with the Minister of Finance having the ability to set aside sums of funds from the Consolidated Fund. At this time, only the Bermuda Government makes contributions to the UIF to maintain its existence.

Since March of 2020, the Government has paid out over $58 million in Unemployment Benefits. This level of expenditure by the Government is unsustainable.

An Unemployment Insurance Program supported by additional funding, by employee and employer contributions is being considered, reducing the burden on the Government and ensuring that funds are readily available when needed.

A successfully implemented UIP will provide financial support to individuals following job loss, assuming they have met all predetermined eligibility requirements.

I welcome any questions from the media.

DAVID BURCH:

Good Afternoon – it was December 17th, 2020 when the Executive Director of the Bermuda Economic Development Corporation, Mrs. Erica Smith and I launched the Short Term Stimulus Programme to a maximum value of BMD $13,385,000 and invited small to medium sized contractors to participate.

There is an urgent need to provide stimulus to the local economy in order to retain and boost employment numbers in the wake of the economic downturn sparked by the COVID-19 pandemic. The Ministry of Public Works has compiled a list of “shovel ready” projects that are executable within 3 months. These projects are mostly infrastructure improvements and will not add further burden to government operational expenses. The project’s selection principles are to maximize the employment of the private sector while providing much-needed refreshing of neglected infrastructure.

The Ministry released a Request for Suppliers Qualifications [RFSQ] across multiple disciplines to generate a prequalification list of approved contractors/companies that can participate in the programme. This approach is in line with Pre-Qualification Procedure and Approved Contractor lists of the Code of Practice for Project Management and Procurement. The prequalification criteria will include a scoring of technical competence, local employment benefit, and a schedule of unit rates. Suitable companies will then be added to an approved contractor list.

With the development of the list, the Ministry would then use the restricted procedure (section 16 of Code) to quickly obtain three or more quotations from the various suppliers, grouped by suitability and vocation, to select a contractor for each project. Where works are specialized, or contractors’ availability is limited, either 2 through companies already obtaining a project from the programme or natural scarcity, a Single Source contract will be negotiated based upon the unit rates. The work to be done under this contract and in accordance with these specifications consists of furnishing of equipment, material, supervision, labour, technical knowledge, and skills necessary to satisfactorily and safely complete the job as outlined in the agreement.

To ensure allocation of the stimulus funding across all the participating businesses, the Ministry will maintain a register of approved contractor lists and awarded contracts to ensure that no one company monopolizes the project list. Once a company obtains a project, they will be rotated to the bottom of the list to allow other companies an opportunity for work. The guiding principle would be to prioritize all companies that provide the most employment benefit per dollar spent and spread the work among Bermudian owned and operated businesses.

The plan is to utilise medium to small contractors for the work that will be done at dock and building refurbishments, new construction, Canal clearance, roadside fencing and health & safety improvements.

A consultant Project Manager, Mr. Robert Richardson has been assigned by the Ministry to this project to coordinate the efforts of all those involved as well as liaise with the Bermuda Economic Development Corporation.

The Ministry is working in consultation with the Office of Project Management and Procurement [OPMP] as well as the Bermuda Economic Development Corporation [BEDC]. The intention is for BEDC to provide assistance to small and medium sized Contractors to complete the required submission documents for the RFSQ.

We recognize that some small to medium sized Companies may not have the administrative support to respond to government solicitations and the associated procurement requirements and so assistance is being provided by BEDC.

As of January 20th -

175 companies have been emailed to raise awareness about the program.
Email to the professional organizations
BEDC –

81 Virtual Session Registrations
35 Virtual sessions actual attendance 3
BEDC have advertised via numerous platforms ( social media, radio interviews, FB, Website, Email Blast)
Planned sessions totaled 20 but have been reduced to 13 as no one registered for 7 slots
One more Virtual session planned for Feb 2nd
Up to this morning we have received 36 official individual submissions with 8 being fully completed to stimulus@gov.bm:

During early discussions some small contractors have highlighted impediments to participating such as mobilisation costs & the delayed payment schedule. As this programme is operating under specific financial instructions that allow for flexibility – I have asked the team to explore ways that we can address both of these impediments.

Let me encourage those who would not normally apply to do so.

We are determined to involve as many small and medium sized contractors as possible and are providing every opportunity for them to become involved. I invite all those who view this announcement and know a small or medium sized contractor to inform them of this initiative. They can gain more information by signing on to the government website at https://www.gov.bm/procurement/rfsqstimulus-program or emailing stimulus@gov.bm.

We can pay people to sit at home or we can pay them to repair our infrastructure – we choose the latter.

Thank you.
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