Good News! TCI Gov’t ends FY 2020-2021 with lower than expected Operating Deficit

#TuksandCaicos, May 5, 2021 – Monday, May 3, 2021, marked 50 working days of the new TCI PNP administration. Even though the new government took over in the middle of the pandemic when the future economic potential of the islands seemed murkier, the country is doing far much better than anticipated from a financial standpoint.

Speaking about the progress made by the new government, the Premier explained the country’s financial state while emphasizing how critical planning has been vital in fulfilling the Citizen’s Contract; the Progressive National Party’s 2021 campaign manifesto. 

“In these early days, planning has been critical. Hence, upon establishing the financial position from an insider’s point of view, our effort has been centered on planning for fiscal sustainability and fiscal soundness in these unprecedented times,” said the Premier, and Minister of Finance,  Hon. Washington Misick. 

“We have spent the last two months rejiggering the budget to mitigate unforeseeable risks and put the country on a trajectory of growth as global efforts take us to the other side of this pandemic,” he added while explaining the new government’s strategies in overcoming the consequences of the pandemic.

In his speech, the Premier focused on new spending; these will be included in the new Budget set to be read in June 2021. 

“At this juncture, we are on target to deliver the Budget by the end of June, including an additional $48 million in brand new spending,” said Hon. Missick. Even though the far-reaching effects of the pandemic led to a 26 per cent shrink in revenue collection, the Premier admitted the fiscal performance was better than projected. 

Announced was $2 million dollars for a law enforcement training academy; $6 million dollars has been carved out for land purchases, in order said the Premier to buy back beach front land for the development of recreational sites for the people of the country. 

Also in that ‘new spend’ list was $3 million for software toward the digital transformation of Government; $2 million to reinstate public sector pensions and there is to be a half a million dollar investment for a health information system. 

Significantly and uniquely, $15 million is allocated to poverty alleviation projects including community enhancements and coming soon is urban renewal programs across the country. 

A hotline will be set up; the Premier said he is creating a way for residents to speak directly to government instead of to social media.

“The overall outturn of the Turks and Caicos Islands Government fiscal performance has been better than expected when the budget was last revised. This is due to improvement in revenue collection in the final quarter of the year as well as reduction in expenditure for the year.

“Turks and Caicos Islands Government was able to end the fiscal year 2020/2021 with a lower-than-expected operating deficit. The total deficit for the financial year was $93 million after debt repayment. This deficit was funded from the cash reserves,” said Hon. Misick, before shifting focus to the achievements made during their 50 days of governance. 

Turks and Caicos, as a result of the better performance of the economy may no longer have to increase borrowing from the Republic Bank.

The last quarter’s actuals outperformed estimates, negating an early trigger to draw down on funds from the $80M facility negotiated with Republic Bank. Because of that, the requirement to negotiate the restructuring of that facility for a larger facility is no longer necessary.

The Premier conservatively forecasts, the economy will expand by 2.5 per cent in the current fiscal period.

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