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For years now I have noticed that major consciousness change in our Bahamas is usually the result of copying others rather than careful thought to the introduction or implementation of the same.
If we want to make a new law, we seem to do it by copying similar laws from other jurisdictions. This is quite alright but it has to be done bearing in mind that the other place had a reason for the idea and the words used. Often, we will just slavishly copy a paragraph from here and a paragraph from there and in the result what we have is a mess. Then when we do further changes, it is with reckless abandon.
In the area of governance I am extremely concerned as we appear to have confounded two cardinal principles of the Westminster system to which we subscribe but for which we have a lack of understanding or appreciation of why they are part of the system.
The first is the role of the backbench in Parliament and the other is the operational role of the civil service.
The backbench: As recently as 1992, there was an identifiable backbench in Parliament - i.e., parliamentarians who were members of the governing party but were not ministers or part of the Cabinet. These backbenchers, although part of the governing party, were not bound by the collective responsibility of Cabinet and were able to cast their votes freely. These people were often noted for their independence of expression and were often cast as rebels. Names such as Oscar Johnson Sr., Cadwell Armbrister, Edmund Moxey and Milo Butler Jr. come to mind.
In Parliament, legislation passes by a vote of the majority. If the governing party has an overwhelming majority and the leader has control of them, he can pass almost anything he wishes. The opposition is usually more seen than heard and of little effect save at the next election.
Backbenchers served as a much-needed check and balance in a government where often the imbalance of power between the governing party and the opposition was overwhelming. Their hallmark was their independence despite their allegiance. Typically they were people who had been passed over for Cabinet positions, often because of perceived lack of ability or seniority, alienation from the existing power structure in the party or even by choice, such as where they wished to continue their everyday endeavors while serving.
Should a government lose a vote when the "whip" is on, it could signal a vote of no confidence in the government. Any party leader would have to consider these people when making any decisions. This put reins on the serving leader, who would have to consider what would happen if his backbench voted with the opposition (who could almost certainly be counted on to vote against him).
Hubert Ingraham, after winning in 1992, began the era of what was then called "the Gussie Mae Cabinet", extending the numbers beyond the 12 or so people hitherto relied on and making the majority of his serving party members ministers or junior ministers (ministers of state) and parliamentary secretaries. Although the then opposition whined about it at the time, they ensured that this became entrenched by repeating it. Today, out of the PLP parliamentarians, 16 are ministers, five are junior ministers and three are parliamentary secretaries; two are speaker and deputy speaker. Then an additional three head government corporations and one is an ambassador. Only two can truly be called "backbenchers".
The reason given always was that these people could train in the position so that whenever there was a generational handover they would be prepared. Utter bunk! It has also proved very costly as the member's remuneration is increased by every role he fills - a backdoor methodology of increasing a member's salary without seeking parliamentary approval to raise the salaries of members to the gullible public.
Over time, we have evolved to a point where it is degrading to be a backbencher. It is an indication of deficiency.
Instead, governments can now proceed without any checks or balances, save for the next election. The people can only show their dissatisfaction at that time. This, no doubt, contributes to the see-saw effect we now see taking place.
I have no doubt that this was done in order to help ensure control by firstly binding them by collective Cabinet responsibility, and secondly by making them so dependent on the increased remuneration that they would not dare challenge the leader. There are many serving now who made less in the private sector than they now make in government. This has hampered democracy in our country.
The civil service: In tandem with the increase in the size of the Cabinet has been the neutering of the civil service. Have you noticed that the staff at any ministry now seems to be operating as a PR arm of the serving minister? Every action in the ministry is attributed to the minister. Every story in the paper concerning a ministry is accompanied by a picture of the minister.
Historically, the civil service was a check on ministerial abuse on the one hand and, on the other, it saved many a minister by its non-involvement in politics. The job of the minister was setting the overall policy of the ministry (in consultation with the senior officers) and ensuring that the leadership in the ministry was competent at what it did. It also meant that the minister of health did not have to be a doctor or the minister of works an engineer. In fact, what this ensured was that a particular professional bias would not control decisions at the ministry. The director and his department are usually the technocrats and the permanent secretary and subordinate staff the administrators, and whatever is necessary.
The friction which constantly existed between the minister and his civil servants was best illustrated in the old English sitcom "Yes, Minister". Yes, ministers complained that they often had to take the blame for their civil servants and resented it. There is an attraction to the thinking that if you are going to take the blame then you should have the power. However, this is not a part of the Westminster system of government. That belongs to systems where when one party goes the top civil servants do also.
It was also the job of the minister to give cover to his officials who were mainly anonymous. This was in the best interest of the system. It started when the former prime minister declared that civil servants would have to defend themselves and could not take cover from the minister. This created a reticence on the part of many civil servants who did not consider themselves politicians or lovers of the limelight and eventually they welcomed passing as many functions as possible to the minister.
Now we have the cowboy minister who is an "expert" on his ministry and who appears to be in virtual control. The result is that ministries are incapable of making plans that go beyond the tenure of the existing minister and in no case more than five years.
I was struck some weeks ago at the prime minister's response to a question of whether or not he would have a Cabinet shuffle. He answered that a number of his ministers had bold programs they wanted to implement and for this reason he would not do so now. It brought me to the realization that today, the ministry truly revolves around the minister. If you have any appreciation for our system of government, it will be abundantly clear that this is wrong.
- Luther H. McDonald
Without language, we cannot conceive, understand and communicate ideas and values. It is important that we get our language right. We often get our language and our thinking muddled and just plain wrong in constitutional matters.
Proper language and terminology communicate concepts and principles. In medicine and science, getting concepts and language wrong may be a matter of life and death. Getting the same wrong in constitutional matters may help to weaken the vitality of our parliamentary system within the body politic.
Since independence, the prime minister of The Bahamas has been frequently and incorrectly referred to in the media, by some commentators and even by various politicians, as the nation's chief executive. The constitution confers no such title on a prime minister.
Day after day the local media, mostly the broadcast media, glibly and inaccurately refer to the prime minister as "the nation's chief".
Much of this is due to our relatively recent and limited history of Cabinet government and as an independent country. With the cult of personality and strongman politics of Sir Lynden Pindling we inflated in our political consciousness the actual powers of a prime minister, whose power, in significant ways, is considerably less than those of a U.S. president. Sir Lynden was often called "chief".
Our proximity to the U.S. and ignorance about our constitution has resulted in a misunderstanding of our parliamentary system and Cabinet government and in the repeated regurgitation of factual errors.
We borrow promiscuously from the American political lexicon expressions which are quite misleading when we try to understand and discuss our own constitution which is vastly different from that of the U.S.
Enamored with the drama of the American presidential system, quite a number of Bahamians are more aware of American civics than we are of our own.
Often mesmerized by the U.S. media's reporting on the American government and the trappings of the U.S. presidency, we sometimes erroneously compare that system with parliamentary democracy absent a deeper appreciation of the origins, history, strengths and potential weaknesses of either system.
Some even don't understand the term republic. One radio talk show host, who is consistently factually wrong and a showman of little substance, recently wrote that he would prefer a republic rather than a parliamentary democracy. For someone who pretends to be intelligent and lays claim to constitutional scholarship, this view is the height of ignorance.
India, Trinidad and Tobago, Guyana, Dominica and many other parliamentary democracies are also republics. We could become a republic and remain a parliamentary democracy. Further, the countries mentioned remain members of the Commonwealth, but not with the British monarch as head of state.
What the uninformed talk show host may have meant is that he prefers an American executive presidential form of government. But, given his ignorance about the various forms of republics, he likely little understands in any depth the nature of the America system of government.
A sign of this ignorance by some is the use of the term "checks and balances" when discussing government accountability. Often, just the term, "checks" is sufficient. But so used are we to aping the language of the American system, that we misapply their language to our system, even when superfluous.
In our system, the prime minister is the most important member of Cabinet and that is why we call him or her prime (or first), and he or she has important constitutional powers including certain powers of appointment.
Still, executive authority under our constitution is vested in the British monarch (Article 71) and is exercised by her representative the governor general. That is why no legislation by Parliament becomes law until it is signed by the governor general.
Further, the constitution gives responsibility for the general direction and control of the government to the Cabinet (Article 72), not the prime minister. That is what collective responsibility means.
In our system the prime minister is not, as President George W. Bush put it, "the decider". The Cabinet collectively are "the deciders".
When Prime Minister Perry Christie, who should know better, mused about the creation of a standard or coat of arms for the prime minister, he was seeking to compete with the monarch's representative.
He was evincing a curious ignorance and telegraphing a U.S.-style presidential mindset that is foreign to our parliamentary system and the concept of collective Cabinet government. Christie seemed to have forgotten that he is head of a government that is collectively responsible to the head of state, to Parliament and to the people.
Article 72 of our constitution provides that the Cabinet "shall have the general direction and control of the government of The Bahamas and shall be collectively responsible to Parliament".
This is very different from systems with an executive president, such as the United States. All important decisions of The Bahamas government must be made collectively by the Cabinet.
The American president individually enjoys extensive executive authority, authority that has grown dramatically since the presidency of Theodore Roosevelt. The repeated assertion that The Bahamas' prime minister inherently has too much power is a red herring.
The U.S. president may engage in certain military actions without the need to get approval from his or her Cabinet or from the Congress, though the president would be wise to consult both. There continues a historic debate about presidential war powers.
In our system, the prime minister must get approval for military action from the Cabinet and for extended military action from Parliament. Recently in the British House of Commons, Prime Minister David Cameron's government got approval for airstrikes in Iraq but not in Syria.
The prime minister's chief responsibility is the coordination and discipline of the Cabinet, where he or she is primus inter pares (first among equals).
A prime minister is expected to provide leadership for his or her colleagues; is responsible for the agenda and conduct of the proceedings of the Cabinet as well as discipline; is responsible for the overall coordination of the government and is the chief spokesperson for the government.
The constitution also gives him or her the authority to make or advise certain appointments, including the appointment of ministers.
A minister, including the prime minister, may bring a paper to Cabinet proposing a certain course of action or policy or project or legislation. A minister may also in certain circumstances raise a matter orally at the table.
Cabinet debates the issue and comes to a conclusion, or conclusions, which is or are then binding on the relevant minister and all of his or her colleagues as well as other relevant agencies of the government.
Once a Cabinet conclusion is arrived at, neither the prime minister nor any other individual minister can legally overturn, reverse or vary such decision. However, the Cabinet can collectively revisit any previous conclusion.
Various prime ministers will be weaker or stronger in terms of leading or dominating a Cabinet. But a stronger Cabinet can restrain a prime minister, and he or she serves at the pleasure of a political party and Parliament and can be removed as leader and prime minister at any time. The same cannot happen in the U.S. system.
There are layers of checks on the powers of a prime minster. A failure to check prime ministerial power lies not in how our system is designed. It lies in his or her Cabinet, parliamentary and party colleagues, which the great Margaret Thatcher learned when she lost the support of her colleagues and subsequently resigned office.
Those who speak flippantly about term limits for a prime minister demonstrate a peculiar ignorance of our system. Such limits, in the words of attorney Andrew Allen, are a solution to a problem which does not exist.
We elect a party to office. There is no direct election of a prime minister. Again, he or she is not an elected chief executive. He or she is a part of Cabinet, in which general direction and control of the country is vested and which is collectively responsible. Should we have term limits on the tenure of service of a Cabinet or ministers minister? Of course, that would be patently absurd.
There are improvements which should and will in time be made to our system, such as how the Senate is constituted. But there is an historic and inherent genius to our parliamentary democracy and Cabinet government which we should seek to better understand and jealously guard.
o email@example.com, www.bahamapundit.com.
The Global Forum on Transparency and Exchange of Information for Tax Purposes reported on several significant offshore and traditional 'on-shore' jurisdictions yesterday, providing Bahamian professionals a little more insight into how to tackle its own identified record-keeping shortcoming.
Nine peer review reports were released yesterday coming out of the Global Forum Meeting held in Bermuda from May 31- 1 June 2011. Like The Bahamas, several jurisdictions will have to redress aspects of their record keeping standards, one of the key areas identified as common deficiencies in the nine reports.
"The most common deficiencies identified in the reports related to the availability of information on persons that are represented by nominees and on foreign companies; incomplete accounting information for some forms of limited liability companies and partnerships; and slow responses by requested countries," said a Global Forum press release yesterday.
An initiative of the Organization for Economic Cooperation and Development (OECD), the Global Forum yesterday released the peer reviews for France, the United States, Switzerland, Italy, New Zealand, Hungary, the Isle of Man, Philippines and Singapore.
In September 2010, record keeping requirements were identified as an area for improvement in the Cayman peer review, with similar language to that used in describing the deficiencies recognized for The Bahamas. News coming out of the Bermuda meeting indicates Cayman may have found a suitable solution to its record-keeping regulations.
"The majority of the jurisdictions previously reviewed say they have changed their domestic legislation following Global Forum recommendations... The Cayman Islands has ensured that offshore entities now have to keep appropriate accounts," according to the OECD yesterday.
Bermuda's Premier Paula Cox, at the Global Forum news conference to announce some of the outcomes of the meeting, addressed the matter of whether or not jurisdictions with no income tax regime were struggling to meet the record-keeping provision more than income tax-based jurisdictions.
"We don't have income tax and it hasn't been seen that that has been a reason why we would struggle with the whole regime of exchange of information," Cox said. "There is a competent authority. You'll know that we have had a long-standing tax convention with the US going back to 1986, and really when jurisdictions or authorities request information we have a documented procedure and we also have a means of giving a turnaround time which is seen as being effective.
"The income tax issue from our perspective in how you monitor and deal with exchange of information hasn't been an impediment."
Bermuda was considered to have met the requirements for record keeping in its September 30th 2010 peer review, though that report noted that aspects of the legal implementation needed improvement. It was recommended that Bermuda "introduce consistent, binding requirements on all relevant entities and arrangements and maintain reliable accounting records including underlying documentation for a minimum of five years."
In its just-released peer review, the Isle of Man was identified as needing to improve its accounting records standards for limited partnerships, the Forum recommending the maintenance of reliable accounting records including underlying documentation for at least five years. It also received a recommendation to clarify its disclosure of information to other enforcement agencies with its treaty partners.
Many in the industry anticipated that the United States would run into some challenges over the laws and regulations governing limited liability companies (LLCs) in a number of its states. The US' peer review did raise matters in respect to the ownership and identity information for single member LLCs and the availability of accounting information for single member LLCs -- where the LLC's business did not require it to file tax returns in the US. Nevertheless, the Forum marked these areas as meeting the standard, saying "The element is in place, but certain aspects of the legal implementation of the element need improvement."
The forum recommended that the US ensure accounting records, including underlying documentation, are available for all LLCs.
France received a clean bill of health for all of the categories reviewed under Phase 1. Like the United States, France and the Isle of Man underwent their phase 1 and 2 peer reviews simultaneously. The phase 1 review looks at the legal and regulatory framework in a jurisdiction, whereas phase 2 looks at the implementation of those laws and regulations.
Recommendations were made to both jurisdictions to improve systems under which the competent authority provides status updates to parties in its network of information sharing agreements.
Switzerland was recognized for the significant change to its approach to information exchange for tax purposes over the last two years, but some deficiencies were identified.
"It has made rapid progress to implement its commitment to the internationally agreed standard. However, the report notes that in a few areas it still falls short of the standard: Bearer savings books are being phased out but still exist. In addition, only a limited number of Switzerland's exchange of information agreements meets the standard," according to the OECD.
Expanded Reverse Osmosis Plant Will Supply 12 Million U.S. Gallons of Water per Day to Water and Sewerage Corporation
George Town, GRAND CAYMAN -
Consolidated Water Co. Ltd.
(NASDAQ: CWCO), which develops and operates seawater desalination
plants and water distribution systems in areas of the world where
naturally occurring supplies of potable water are scarce or nonexistent,
today announced that it has entered into a binding letter agreement
with its customer, the Water and Sewerage Corporation ("WSC"), to
increase the daily production capacity of its Blue Hill plant in Nassau,
Bahamas, by approximately 67% to 12 million U.S. gallons (USgpd),
compared with the plant's current capacity of 7.2 million USgpd...
Bahamians are regularly bombarded with political speeches on the state of hopelessness in the country. They often quote our embarrassing unemployment rates or our unimpressive economic growth prospects. Of course, they blame the 'other' party for the country's problems and typically the debate ends there. Solutions to our problems often tinker around the edges - short-term bandages on wounds that have been spewing blood for decades.
We believe the strongest and most sustainable economies are built from the ground up, where the desires, problems and opinions of stakeholders at all levels are taken into account (See 'Collaborate, Research, Invest' July 18, 2012). We also believe that robust economic growth is often the result of proactive economic planning by government and the private sector that targets areas for investment and develop the institutional/ policy environment to aid in their success.
In order for politicians to properly address the nation's economic problems and to plan for the future, it is important to properly understand the problems from the people who are directly dealing with them. With this in mind, we adopted an Executive Opinion Survey created by the noted World Economics Forum to get an understanding of the main challenges facing industries outside of tourism in the country.
We contacted eight business leaders in five private sectors -- food distribution, waste management, financial services (40 percent of respondents), oil and healthcare and asked them to rank the top five most significant barriers to their businesses from a list of 15.
The graph illustrates the results of this survey. The five most commonly listed barriers appear on the left ranked by degree of importance to the respondents. Three of the top five barriers are directly related to government policy and underscore an important fact - government policy and/or lack thereof is standing in the way of economic progress in The Bahamas.
Serious need for education reform
'Poorly educated workforce' was chosen as the most significant single barrier to doing business in The Bahamas. If one were to take the education system headed by the Ministry of Education as a business, one could suggest that its 'products' - the students - are subpar and ill equipped. Maintaining a failing education system is not an option for an economy seeking to improve its global competitiveness. A non-political and multinational body of education and policy experts should be used to identify the major issues in the system and given the power to implement binding reforms to the Ministry of Education.
P. Sahlberg of Finland studied the various forms of education reform that have led to greater economic competitiveness internationally and his findings provide some useful insight for The Bahamas. The study concluded that collaboration across schools instead of competition between schools fosters a professional culture for teachers that allows for best practices to be diffused between them. Moreover, the best school systems emphasize risk taking and 'fear-free learning' where students are encouraged instead of punished for trying new ideas and new ways of thinking.
Corruption stifles growth
While only two respondents listed corruption in their top five, those affected had significant experiences with corruption. We live in a small country where many unapologetically proclaim that, "it's who ya know, not what ya know". Corruption may also take the form of bribes and governmental/extra-governmental fraud. The implications are very serious. Young, bright talent will be unwilling to deal with corruption and as witnessed in Russia recently, they will leave for the developed markets where their qualifications are respected and rewarded. Furthermore, horror stories of fraud and nepotism catch the eye of international investors who are weary of putting their money in a potentially corrupt economy.
These costs of corruption are too high to ignore. Aggressive legislative protection for whistle blowers is needed to root out corrupt officials with the power to victimize others. Also, full financial transparency at all levels of government; from campaign finance to the distribution of government contracts is one step toward engendering integrity in the economy.
In Sweden, in an attempt to eradicate governmental corruption, the government allowed the mass media and general public access to official government records except those kept secret for national and individual security purposes. The country holds public scrutiny of government as a pillar of transparency.
"By increasing uncertainty about the future, [political instability] may lead to less efficient resource allocation. Additionally, it may reduce research and development efforts by firms and governments, leading to slower
technological progress," the International Monetary Fund said in 2011.
Half of the respondents listed 'political instability' among their most significant barriers to doing business. Indeed, many of the respondents commented that business developments are often put on hold during the 'silly season' before an election when there is great uncertainty in the economy. This is also very problematic for investors who like to know what the long-term policy environment is in order to plan their own business activities. Apart from a national economic plan, a law regulating the handling of previous government contracts and agreements is needed to assure some level of consistency between governments.
Economic planning to alleviate barriers
Our current model of economic growth is haphazard and spontaneous; it changes substantially every time a new government is in power and is exceedingly disjointed, with different sectors completely out of sync with others. We believe that medium- to long-term multi-partisan economic planning, grounded in comprehensive research will certainly boost investor confidence, whether locally or not. This is due in part to the sense of surety economic agents feel when they know what to expect.
An economic plan can also be used to address the major barriers to doing business identified by business leaders. In terms of political inconsistency hurting business development, a long-term economic plan with widespread political and industrial support can reduce the degree of uncertainty between elections since all parties will agree at least in part, to the goals of the plan. A plan can help government and future governments to spell out their policy intentions and thus reduce information gaps for business leaders.
An economic plan can be instrumental to education reform as well. Once a plan is written and identifies industries to be pursued or strengthened, the education system could be improved and changed with these goals in mind. As a result, schools will produce students of greater quality and character, compatible with those economic prospects.
Many of our long-term economic problems require long-term solutions and thus, long-term economic planning. Let us come together as a nation, bring our knowledge and resources to the table, research specific opportunities for economic diversification and expansion and plan for/ invest in our future.
oCFAL is a sister company of The Nassau Guardian under the AF Holdings Ltd. Umbrella. CFAL provides investment management, research, brokerage and pension services. For comments, please contact CFAL at: firstname.lastname@example.org.
- Robinson Road
- Nassau / Paradise Island, Bahamas
I wish to preface my remarks to you this morning with the enduring wisdom of the Greek philosopher Aristotle, who is recorded as saying in his treatise on politics:
“…[O]ne citizen differs from another, but the salvation of the community is the common business of them all. This community is the Constitution; the virtue of the citizen must therefore be relative to the Constitution of which he is a member...”
Communication by Rt. Hon. Hubert A. Ingraham On the Sale of 51% of Bahamas Telecommunications Company To Cable & Wireless Communications, Plc. (CWC)
At the conclusion of my communication I will table the following documents related to the privatization of The Bahamas Telecommunications Company (BTC) and the sale of 51% of the shares in BTC to Cable and Wireless Communications, Plc