Big challenge to attain a sound financial position

POSTED: 09/26/13 1:40 PM

Semiannual report Cft Curacao and St. Maarten

GREAT BAY/WILLEMSTAD – The Board of financial supervision Curacao and St. Maarten (College financieel toezicht – Cft) concludes in its semiannual report concerning the first six months of this year that Curacao as well as St. Maarten are confronted with significant challenges to structurally balance their public finances. For this purpose Curacao has implemented substantial measures. On St. Maarten planned measures to increase income finally were not executed, resulting in a 2013 budget that was not balanced in the first six months of 2013. Not only St. Maarten, but also Curacao are still failing in their efforts to timely set up and adopt budget related documents and timely report to the Parliament (Staten) concerning the public finances. The financial management in both countries therefore still requires the necessary improvements.

The long term budgets illustrate that both countries have to do major efforts in order to reach a balanced picture. The fact that there were deficits in the past years and that these need to be compensated, makes this task even more challenging. The board has a lot of appreciation for the fact that the government of Curacao took the necessary steps in the past year to structurally strengthen the budget by implementing various painful measures. This appreciation was translated into a positive evaluation of a request for a loan. St. Maarten has to take measures on the income side in order to structurally be able to finance its desired multiannual expenditure level. Because the intended income increasing measures were not implemented, the budget was not balanced on St. Maarten. In the beginning of September the Board advised the Council of Ministers of the Kingdom to give St. Maarten an instruction, in order to accomplish as soon as possible an adopted 2013 budget. On September 16, Governor Eugene Holiday adopted the 2013 budget. A few days later this adopted budget was presented to the Cft for advice. The Cft will give its advice as soon as possible, in any case within two weeks.

The Board is concerned about the timely production of the budget documents. Both countries started 2013 without an adopted budget and St. Maarten only has an adopted 2013 budget since September. Besides the annual reports for 2010, 2011 and 2012 and the budget amendments since 10-10-10 have not yet been adopted, which makes it once again clear that the financial management in both countries need improvement. This is also apparent from the measurement of the state of the financial management, which the Board executed jointly with both countries in the past period. Not only is a proper execution of policy difficult without adopted annual reports and budgets, it also has consequences for parliament’s budget right.

 

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