Both First District Representative Hon Andrew A. Fahie (right) and Opposition Leader Hon Julian Fraser RA (R3), left, had said they could not support the motion to borrow $25M from the bank since Government was not providing enough information to justify the loan. Photo: VINO/File

Premier and Minister of Finance Dr The Honourable D. Orlando Smith (left), continues to deny that the country is country broke. Even before the passage of a 2016 $330M Budget Estimate, negotiations started with CIBC FirstCaribben International Bank to secure a loan, or a line of credit, of some $25M to keep government afloat. Photo: VINO/File

Hon Fahie was speaking in the House of Assembly on April 25, 2016 following the motion put before the House to seek approval to secure a $25M line of credit from CIBC FirstCaribbean International Bank to keep government running.

Negotiations had started with the bank to secure a loan even before the passage of a 2016 $330M Budget Estimate, Virgin Islands News Online was reliably informed.

Not enough information

Hon Fahie, just like Opposition Leader Hon Julian Fraser RA (R3), said he could not support the motion since Government was not providing enough information to justify the borrowing.

The former Minister for Education was also curious to know why the amount for the loan being requested was $25 million dollars and not some other figure, and suggested that the amount would be derived based on the cash flow projection for 2016 that would have been given to First Caribbean by the Government of the Virgin Islands.

“In-order for the bank to give the Government a $25 million dollars line of credit/loan they would have had to give them the above information about the Government’s cash-flow situation.

“So the bank has more information about the Government’s financial standing than does the House of Assembly and the hard working tax payers of these Virgin Islands.”

HoA must be shown same respect as bank

Hon Fahie continued to call for a breakdown of the expenditure that would allow Government to go "over draw" up to $25million during the fiscal year 2016.

“You must have justified this request to the bank with something. No one just walks into a bank and verbally requests a $25 million overdraft and gets it. So the same way the bank was respected in giving them documentations to request this money then I am asking that this Honourable House be respected in the same manner and be given that information because it is the people’s business. They are the ones through taxes among other means that will be called upon for the funds to repay,” Hon Fahie had stated.

Indications of a broke Gov’t

There have long been reports that Government left the country broke after the 2015 elections campaign, and while Government has denied this it has refused to come clear on the state of the territory’s finances.

But, according to Hon Fahie, the actions of Government continue to show that the territory’s finances are in dire straits.

He said the request for a line of credit is basically stating that Government does not have any monies and is requesting a cash flow, noting that the heaviest contribution received from Financial Services is in June and November each year.

“This hasn’t changed from government to government but there were never any major cash-flow problems even while operating without those heavy contributions from FSC until recently. Madam Speaker, Government always was able to pay their bills and relatively on time, so the question is what has really happened to our finances under this Administration that we are not being told?”

The Member for the First District argued that no one just walks into a bank and verbally requests a $25 mil overdraft and gets it so the same way the bank was respected in giving them documentations to request this money then the HoA should be respected in the same manner and be given that information since it is the people’s business.

“They are the ones through taxes, among other means, that will be called upon for the funds to repay.”

Further, Hon Fahie stated that even if the request of $25 million is to bridge the gap until Financial Services pays in their contribution to the government then it all adds up to the same thing, that government does not have any money.

‘Madam Speaker, the first step in getting help with any problem is to first admit that you have a problem… Just come out and tell the people that look we don’t have any money and we need a $25 million overdraft. It is as simple as that,” Hon Fahie had stated.