By the end of March 2016, the government is expected to begin using direct deposits rather than checks to pay its bills, according to Prime Minister Perry Christie, who cast the development as part of the government's public sector reform program. Delivering the mid-year budget communication in the House of Assembly yesterday, Christie called the move "concrete and visible progress".
"We are moving diligently to eliminate all payments by check. Presently, a large percentage of payments are made by direct deposit, specifically those made in respect of employee remuneration and payments to pensioners. The focus is now on eliminating check payments to vendors. We are currently on track to effect direct deposits for payments to vendors by the end of March," he said.
"For small businesses, this would eliminate the increasingly significant fees banks are now charging to negotiate checks drawn on another bank."
He noted that this would be "facilitated" through Bank of The Bahamas. The prime minister did not say anything about this facility being offered by any of the other clearing banks, particularly Royal Bank of Canada, which many consider to be the government's primary bank.
According to Christie, the move is part of a program of reform of the public financial management system being mounted with the financial support of the Inter-American Development Bank (IDB). Christie said the program is expected to have a positive impact on the performance of The Bahamas' public sector by strengthening the capacity of the Office of the Prime Minister to monitor performance in the implementation of public policies in key line ministries.
The program is additionally anticipated to improve the quality of statistical production, provide increased access to official statistics and offer a more effective use of statistics for policymaking in line with regional and international standards. The public sector will also benefit from a more efficient public financial management system with a new upgraded integrated financial management information system (IFMIS) that has been fully implemented and is functional in line ministries and relevant public entities. Finally, with the program will come an improved public procurement system with fair and transparent rules, generating savings and value for line ministries and relevant public entities.
He added that work is proceeding "expeditiously" on the publication of a concept paper on public sector accounting standards.
"The Treasury is working with a BICA (Bahamas Institute of Chartered Accountants) representative on this very important initiative as it sets the stage for reform as envisaged by the IDB IFMIS project. The target date for completion is also the end of March," Christie said. "The concept paper would provide the blueprint for reform of the government's reporting of its fiscal results in a professional and non-partisan manner. This is very important in a world where national governments are under close scrutiny from international ratings agencies, banks and investors."
By K. Quincy Parker
Guardian Staff
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