Saturday, Jun 06th

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Editorial - Sustainably healthy

That the Kingdom Council of Ministers issued a budgetary instruction to St. Maarten (see related story) should surprise nobody. After all, the Committee for Financial Supervision CFT had advised just that also after its latest meeting with Finance Minister Martin Hassink.

Measures to make the 2015 budget realistic and improve the multi-annual picture now will have to be taken by the end of October. In the next three years Government also is to compensate deficits of past years totalling at least 60 million guilders and settle its arrears of a combined 189 million guilders, most of it to general pension fund APS and Social Health Insurance SZV.

Furthermore, the budget must be adapted to fully include the APS and SZV premiums, while the country has until the end of 2016 to create a tenable social insurance and pension system; among other things, by increasing the pensionable age first to 62 and ultimately to 65.

Dutch Minister of Kingdom Relations Ronald Plasterk said assistance to execute the instruction would be available if requested, but that the collection of taxes was a local task.

Interestingly, he also mentioned having appreciation for Hassink and that the instruction could be considered support for his efforts. The latter creates the impression that the Gumbs cabinet knows what is needed, but is not politically able to do it.

Be that as it may, there is little choice left and the other ministers too, as well as elected representatives in Parliament, will have to live with that reality, because the planned appeal to the Council of State in this case doesn’t appear to have much of a chance. Consequently, cost-cutting and revenue-increasing steps can be expected that may hurt in the short term, but hopefully can help make and keep St. Maarten’ s public finances sustainably healthy in the near future.