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HSF now US$5.67 billion

Published: 
Tuesday, May 16, 2017

After two drawdowns of US$375 million in 2016 and US$250 million this year, respectively, the Heritage and Stabilisation Fund has largely recovered as a result of income the fund has earned.

This is according to Finance Minister Colm Imbert, who was presenting the Finance Variation of Appropriation Bill in the Senate yesterday.

The legislation seeks to vary the 2017 national budget. It was approved in the House of Representatives last week.

Imbert said the fund now stands at US$5.675 billion.

He said when the first draw down was made the fund was reduced from US$5.4 billion. Imbert said since that time to the second draw down “we recovered US$275 million in income. So the fund went from US$5.4 billion to almost US$5.7 million.”

Imbert said: “In the two months since (that) we had the last (second) draw down we’ve earned another US$100 million, so basically speaking the fund went from US$5.75 billion to US$5.4billion and from $5.4 billion to the time we did the second draw down, we have recovered US$275 million so it went back up to US$5.675 billion.”

He said in the past months there has been “an increase in tax collection from petroleum companies. We have had an increase in tax collections primarily due to the millionaire tax.”

Imbert said: “While we have had an increase in gas production, we have had a strengthening of natural gas prices. But we are still losing over US$2 billion in foreign exchange, which makes it quite difficult for us to deal with demand for foreign exchange.”

Imbert also said there has been a reduction in collections from VAT .

He said: “Our expenditure has been 14 per cent lower than projected, so we have been keeping a tight reign on expenditures so we are below our budget projections in terms of expenditure.”

Imbert was severely criticised by Opposition Senator Wade Mark on the foreign exchange situation.

Mark also expressed concern about a recent decision by the Public Service Commission (PSC) to delegate authority to the Permanent Secretaries in the Office of the Prime Minister and the Ministries of Public Administration, Local Government, Community development, Culture and the Arts and Energy to hire and discipline staff.

Mark said that was “a most backward step. It is a dangerous path we are traversing and I call on the PSC to come clean and issue a statement to this country as to the modalities and where this was gazetted.”

Independent Senator Jennifer Raffoul said the existing system of allocation foreign exchange was not sustainable and certain things should be done to ensure that the situation was adequately resolved.

She also said the country’s problems were caused by “our own overspending and not necessarily because of international factors.”

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