| The British Minister for the Overseas Territories, Henry Bellingham MP, has written Chief Minister and Minister of Finance, Hubert Hughes, expressing concern over the state of Anguilla’s public finances. |
Mr. Bellingham gave his views in what is considered to be one of his most forthright letters to be sent to the island’s Government leader. Following is the full text of the British Minister’s letter dated 18th September, 2011: Hon Hubert Hughes  ADVERTISEMENT Dear Hubert “The Minister for State for International Development and I are deeply concerned about the state of the public finances in Anguilla. The Government of Anguilla’s own analysis shows that revenues are falling short of the budgeted level, meaning that on current trends, there will be a larger than budgeted deficit at the end of 2011. “The anticipated revenues from the sale of the Viceroy resort should not be used for recurrent expenditure, but should be used for capital expenditure and to build up the Government of Anguilla’s reserves. The recent report by the IMF anticipated an overall deficit of EC$20m in 2012, which is much worse than that projected in the current budget and would mean that the Government of Anguilla would fail to meet its June 2010 commitment of balancing the overall budget by the end of 2012. “In March 2011, the Government of Anguilla committed itself to an action plan which included the introduction of new revenue measures in 2011 if those already in place were not performing appropriately. It is clear that they are, indeed, not performing appropriately and so far you have failed to meet that commitment. In light of this underperformance, the Government of Anguilla will need to take urgent action to ensure that it meets both its 2011 action plan commitment and its 2012 commitment of an overall balanced budget. “The Minister for State for International Development and I want to see the introduction of an immediate package of corrective measures, as mentioned in the Governor’s letter to you of 16 August, that will close the expected 2011 deficit to the level proposed in the budget. In order to assist, my officials are prepared to work closely with your officials on the development of a strong and sustainable budget in 2012. I am writing in advance of seeing the draft of the 2012 budget (that you promised I would receive by the end of October) to encourage you to ensure that it enables the Government of Anguilla to meet its commitments. “The UK itself is making tough decisions in the face of economic difficulties. Anguilla needs to do the same. We have provided technical assistance to work alongside the tax reform working group, to review the health sector in Anguilla, and to assess the effectiveness and efficiency in the public sector. I urge you to make use of this technical assistance and to implement the recommendations made as part of that work, particularly the recommendations flowing out of the Civil Service Review which gives you an excellent chance to cut expenditure on the public sector whilst maintaining services for the public. This will help improve value for money provided by the public sector for residents of Anguilla. The UK Government is willing to consider further technical assistance on a case by case basis. “I look forward to hearing about the urgent actions your Government is taking to improve the fiscal position this year and I hope that by the time of the OTCC in November we will have agreed the shape of the 2012 budget in order for you to meet your commitment to balancing the overall budget by the end of 2012.” Henry Bellingham MP |
