PHILIPSBURG--While the country has seen and continues to expect economic growth, this has "not resulted in greater fiscal space nor resolved all the prevailing socio-economic issues," Governor Eugene Holiday said in his traditional opening of the fifth Parliamentary Year on Tuesday.
To tackle that lack of results, it is "essential" for unemployment, poverty, increasing healthcare cost and increasing shortage in affordable housing to "continue to receive the necessary attention," he said.
The policy challenges through existing plans and/or development and implementation of new policy plans will come "at a cost." That cost will "have to be managed efficiently and effectively" in view of the "limited fiscal space" in which government will be operating.
His speech focused on "policy challenges and opportunities" awaiting the new government coalition to take office on October 10, rather than government's plans for the new political year.
According to Holiday, initial indications show that an increase in tourism can be seen already in the recent figures. Projections of the International Monetary Fund (IMF) and the Ministry of Tourism and Economic Affairs show an economic growth of about two per cent this year. The country has "a healthy debt-to-GDP ratio of approximately 30 per cent."
New legislation has been prepared for further handling by Parliament this year, including a new law creating a small claims court, a change of the law to implement a tourist driver's licence and a new code for penal procedures.
Government has taken steps to introduce an intellectual property bureau. The ordinance in which the tasks and responsibilities of the intellectual property bureau are laid down has been presented to Parliament.
Other important policy challenges ahead include the development of the competition and consumer protection authority and an agency responsible for licensing and control over all gaming operations in the country, and a review of the tariff systems.
The current government "hopes to contribute to the debate on future policy plans of the new government aimed at continuing to create opportunities for all residents" based on "a sound national, social and economic foundation," through its outlined overview of legislation before Parliament and through the identified policy challenges and opportunities, said Holiday.
He told Members of Parliament, the Council of Ministers, members of the court and High Councils of State, and other invitees gathered in Parliament House for the opening that his reason for looking at the challenges had to do with the new political year starting "at a time of transition," as the composition of Parliament will change with the swearing-in of new Members of Parliament in just over a month.
Governance of the country is in "a transition phase, with the current ministers functioning as caretakers. In this caretaker capacity I have requested the current ministers to continue to manage the interest of the people by addressing the day-to-day operations of the country," he said.
Care for elderly
Holiday said it was "critical to note" that while the population was still comparatively young, people were living longer and as a result ageing steadily. "These issues form critical policy challenges." Addressing these issues is "important to ensure a balanced and sustainable development of our country."
Government, among other things, has drafted legislation to address these concerns. These include a draft ordinance to change legislation concerning civil contracts and the proposed price indexation legislation that will lead to an increase in social benefits. Both are expected to be presented to Parliament this year.
Government has adopted "a phased approach" to curb potential poverty among the current and future generations of elderly persons. In the first phase, government has decided to increase pension benefits and the pension age from 60 to 62. Legislation to that effect already has been presented to Parliament for approval. The second phase concerns researching the feasibility and design of a compulsory pension plan.
"Maintaining current social security provisions, health promotion activities and the quality of health care in light of annual budget cuts are other issues the new government and Parliament will face," the governor said.
Developing and offering education that gives people the right skills and knowledge to become productive participants in our society, is "ultimately the most effective way to combat unemployment," the governor said.
The promotion of equal access to quality education, recreation, social and psychical development has therefore been a key objective of the current government. The preparation of legislation on study financing and on higher education has been "high on government's agenda" and these are in their final stage.
Steps to establish international and regional relations to promote education, sports, cultural and youth affairs look promising. In particular, contacts have been made in the Caribbean Community Caricom with meetings held in St. Kitts and Anguilla and existing plans to meet with Barbados officials.
"Government believes that fostering these ties and working in a close relationship with our French neighbours and the Netherlands can play a major role in the realisation of the potential of St. Maarten's education system, Holiday said.
While the safety and security challenges are complex, opportunities can be found in the form of the Justice Academy for capacity building as well as in the form of international and cross-border cooperation with the French authorities to better combat and disrupt criminal operations, Holiday said.
Maintaining good foreign relations has been "a priority" for the past governments and "should undoubtedly remain a key factor in future governance." Strong bonds in the region and internationally can help St. Maarten "to build capacity and grow economically."
Government has worked over the past year to reduce the backlog in financial reporting and to manage information properly by instituting monthly reporting per ministry. These steps provide the basis and tools to manage income better, control spending and give account of government's activities.
Progress has been made in the preparation of the 2012 financial statement and the draft budget of 2015 for presentation to Parliament. The 2011 financial statement and the ordinance to amend the 2014 budget already have been presented to Parliament for consideration.
Concerns about tax collection and non-compliance have had the attention of the current government and "are expected to continue to be important policy challenges for the coming period." The development and introduction of tax reform measures "should therefore remain high on the policy agenda," Holiday said.
He added that in doing so, it was essential to make use of the opportunity to strengthen the function of taxation as a source of revenue and at the same time implement tax reforms that would favour the poor on the island.
It has been the policy of the current government to strengthen the public administration through institutional and capacity building. An "important aspect" with regard to public administration is the ongoing debate about integrity and the promotion of integrity as a means to ensure good governance.
"Considering the work carried out under the government's integrity programme during the past years and given the number of integrity inquiries conducted it will be up to the new government, supported by Parliament, to address this critical concern," Holiday said.