BVI Airways Agreement 'guarantees' money will be repaid- Premier Smith
This comes a day after we reported that Leader of the Opposition Honourable Julian Fraser RA (R3) was adamant that the money would eventually be written off as a grant not to be paid back.
Honourable Fraser gleaned from the responses that the Premier provided during the Eighth Sitting of the First Session of the Third House of Assembly on April 18, 2016 that the money was a subsidy to help the airline get off the ground.
Asked by Hon Fraser whether the $7M reported for BVI Airways as an investment has derived any share capital in the airline and how much, Premier Smith said the money has not and was not intended to provide any share capital.
“This investment into BVI Airways is intended solely as a subsidy to assist in defraying the costs associated with the airline’s ability to provided a service for the people of the BVI...It is expected, however, Madam Speaker, that the BVI will recover this investment within the first three years of the airline’s operation,” Premier Smith had stated in the HoA.
‘Subsidy or Investment money will be recouped’- Premier Smith
When we approached the Premier for a response to Honourable Fraser's assertions yesterday April 25, 2016 Premier Smith said that it is enshrined in the agreement between the airline and the government that the money would be repaid through a profit sharing arrangement over a period of three years.
"As I explained in my answer to the Honourable Leader of the Opposition Honourable Julian Fraser RA, whether you call it a subsidy or investment, the point is we get our return of our money," said Premier Smith.
Asked what guarantees are there to ensure that the Treasury's monies are repaid, he said, the guarantees are there in the agreement."
Asked about the specifics of the guarantee and whether it had to do with number of persons using the service, he said that it was not that kind of guarantee.
"I can't remember what clause it is in the agreement but it is in the agreement," he stressed.
"It is a profit sharing arrangement in which we will get our money back...this is not a wasted investment."
Premier Smith further said there will be no repayment until the airline actually starts flying. This he estimates to be in October 2016.
At a forum earlier this year, Premier Smith said he was assured by persons in the hospitality sector that they have already booked up flights on the airline which is yet to take off, “literally and figuratively.”
Critics have called down the National Democratic Party government for making this financial outlay in the face of persons who cannot be paid for services rendered to government since 2015 and for a government which said it has to be prudent with spending as things are tight.
Further, critics from all quarters blasted the government for not extending similar courtesies to the ferry services that ply the sister islands and the United States Virgin Islands.
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19 Responses to “BVI Airways Agreement 'guarantees' money will be repaid- Premier Smith”
bad service, wasnt that a problem then. I didnt hear
the dogs barking. Now you got a real investment and making
noise.
https://issuu.com/bvibeacon/docs/bvi_airways_agreement