The Ministry of Finance of the Government of Anguilla has crafted a budget of 339 million Eastern Caribbean dollars to meet the growing cost of the island’s public services and capital programme for 2009. It is the largest estimated expenditure so far from the island’s Treasury and a far cry from the days of a grossly under-developed public sector when the budget was “a mere drop in the bucket.”

Hon. Victor Banks delivering Budget Address

The 2009 Budget Address, also the longest, and under the theme Strengthening the Collective…We are the Solution, was delivered late Monday evening, December 8, by the Hon. Minister of Finance, Economic Development, Investment, Commerce and Tourism, Victor Banks. The presentation was delivered at the Atlin Noraldo Harrigan OBE Parliamentary Building in the presence of many invited guests representing the public and private sectors.

Government Officials and others in the Gallery

Of the $339 million, $241 million has been estimated for Recurrent Expenditure and $98 million for Capital Expenditure. Over 35% of the Recurrent Expenditure is estimated to be spent by the Ministry of Social Development and its departments and some 29% will go to the Ministry of Finance and its departments. About 42% of the Capital Budget has been allocated to the Ministry of Infrastructure, Communications, Utilities, Housing, Agriculture and Fisheries; and over 37% has been appropriated for the Chief Minister’s Office and departments.

Other invited guests at the House of Assembly Gallery

Mr. Banks told the House of Assembly that the revenue budgeted for 2009 showed a modest increase of $9.3 million over the 2008 estimate and that the budget for the New Year would be realised “by marginal increases in some taxes, rates, fees and charges as well as by improving the efficiency and effectiveness of the revenue collection system.”
He said the increase in revenue of $4 million over the 2008 figure was mainly expected from Stamp Duties resulting from alien landholders’ licenses to be issued to purchasers of real estate when the Viceroy project opens for operation in 2009.

The Government side of the House

The Minister of Finance said that the coming increases in some taxes, rates and fees to bring them in line with today’s prices were not significant amounts for taxpayers. He listed the new increases and sources as follows: Property Tax with the introduction on January 1, 2009, of a new tax system; a 7% increase on the Environmental Levy paid on electricity bills (He explained that the impact on the consumer would be small at a time when electricity rates were decreasing and that it was one of the cost recovery measures fore garbage removal and the maintenance of the Corito landfill site); the Tourism Marketing Levy will be changed from US$1.00 per room per night to US$1.00 per person per night; Motor Vehicle Licences will be increased by 5% and 10% for certain categories of vehicles; there will be increases in fees charged for acquiring belonger status, passports; Lands and Surveys and Physical Planning services and Police Certificates; and increases in fees for medical and health services (although the Health Authority is not a Government department but is heavily subsidized by public funds).

Opposition Members Hubert Hughes and Edison Baird

Mr. Banks stated that the machinery would be put in place during 2009 for the functioning of the National Health Fund in 2009 to which the people of the island would be required to contribute. He added that another course of action being taken by Government was the drafting of a new Tax Administration Act to be implemented early in the New Year. He was of the view that the Government’s tax collection legislation had been generally weak.

Speaker David Carty

While speaking about revenue and expenditure estimates and other new budgetary matters, the Minister disclosed that Anguilla’s public debt stood at EC$152.68 million or 65% of the Gross Domestic Product at the third quarter of 2008. He made the point that debt service payments as a percentage of estimated revenue, at the end of September, stood at 4.09 % which was well within the recommended ratio of 8 %. In commenting on the island’s credit-worthiness, Mr. Banks noted that Caribbean Information and Credit Rating Services Ltd based in Trinidad & Tobago had issued Anguilla with a double A rating for a national debt of US$25 million or its equivalent.

The Budget debate is now remains to be held to give approval to the 2009 budget. The Government proposed Thursday this week for that occasion but the Opposition Members were of the view that they needed more time as there were a number of issues in the Budget Address which they wanted to think about and express their views on. The debate was therefore set for Tuesday, December 16, by the Speaker in consultation with both sides of the House of Assembly at a time to be decided on.

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