02 September, 2009


The Ministers propose to take a motion to authorize additional borrowing to the House of Assembly, regardless of the British Government’s disapproval. We have looked previously at the British Government’s refusal to permit the United Front government to increase Anguilla’s borrowing in the absence of any hope or plan to repay the debt. Now, the Minister says he is going to take a proposal to the House to authorize some $40 million, whether the British government sanctions it or not.

Can he do that?

Section 55 of the Anguilla Constitution 1982 sets out the limitations to the powers of the Anguilla House of Assembly. It states that “Except on the recommendation of the Governor” the Assembly shall not proceed upon any Bill, or any motion, or any petition, which in the opinion of the person presiding makes provision for increasing any charge on the revenues or other funds of Anguilla. The person presiding is the Hon David Carty, the Speaker of the House. He has long served as chairman or other high party official of the ruling United Front and its predecessor ANA party.

Once the Governor informs the Speaker that he objects to the motion or resolution or proposal to increase Anguilla’s borrowing, it would be the constitutional duty of the Speaker to prevent the government ministers from debating the matter.

The first big question then, is whether the Governor will make any objection known to the Speaker in advance?

The next big question is, will the Speaker permit the Ministers to introduce such a motion in the face of its evident illegality?

In my view, any lender proceeding to advance funds to government in the face of the illegality of the borrowing will be at risk of a court ruling that the Assembly had no power to authorise the borrowing. A court would be likely to rule that the borrowing was illegal and was not an obligation binding on any future government. The lender would have to look elsewhere to recover their funds.

In the event of a law suit brought against them, the members of the House who acted illegally would be at risk of having their personal property and possessions seized in repayment of the illegal debt that they incurred.

If the Governor does not inform the Speaker that he has any objection then, in my view, the Speaker will be entitled to assume that the Ministers would not be bringing the motion unless they had the Governor’s permission, as required by section 55.


  1. The speaker should not allow this to come to the floor of the house of assembly as it seems to be unlawful and in my opinion is certainly wrong.
    No way should the governor allow any more borrowing to take place. We have no way of paying loans back so we must not borrow.
    Reduce the number of government workers by attrition, for the next two months ask government workers to take every other week off without pay this would keave 50% at work at all times.Government ministers take no salary for the next 2 months. Rescind the last badly advised pay increases. Cut government spending immediately. Sell the vehicles given to government ministers, this will help to pay the government workers. Impose large fines on companies employing foriegners without a valid work permit. Learn how to economise in government spending.
    Call the election in the next 3 months.
    The speaker of the house should not allow this government to saddle us or the next government with any more debt.

  2. When a country is in the throes of an Economic Recession/depression like we are in Anguilla; when Private Investment is stopped, it is incumbent on the Government to stimulate the Economy by Public Spending. There is no other way to prevent absolute Economic disaster.

    Every Government on Earth must Borrow to spend. They do so on the basis that the Public Spending will create Economic activity which will in turn create revenues from which to repay Government Debt. The British Government borrows Billions of Pounds Annualy to fund their Public Expenditure. So does the U.S.A and every other so called Developed Country.
    Obviously "Anonymous 11:18 AM" speaks without bothering to engage the intellectual process. Why else rail against Public Borrowing without a factual basis? Why else no mention of where Government revenues will come? Those examples given, such as workers working half time for half pay etc. show that he/she did indeed NOT think before typing. What happens when all Civil Servants lose 1/2 their income?? They lose their homes, their cars, their children's education etc. etc. "Impose large fines on companies employing foreigners without valid work permits". Exactly how much revenue do you think this would generate? It also would not be recurring revenue. Same with " Sell the vehicles given to government ministers.." How much? And for how long? Who would you suggest they "sell" them too? Haven't you seen all the cars with For Sale signs sitting undisturbed? Have you checked the Car Dealerships recently? They surely aren't seeing any rush of sales, are they? Don't you realize that the Banks are not lending freely?
    What "government spending" exactly would you propose they cut "immeadiately"?

    Would you take a 50% pay cut, like the one you are effectively proposing for Civil servants? Would you forgo your income for the next two months like you propose the Ministers do?

    "Learn how to economise in government spending"?
    Where are the economies you propose they employ to this end?
    "Call the election in the next three months". Now, THAT exposes your motive.

    In a nutshell, Sir/Madam, it is ridiculous to expect any recovery in Anguilla unless the Government borrows to fund Public Investment to stimulate the Economy. Anything short of that spells certain doom for us.

    I fully support the Government borrowing to stimulate the Economy. If the British wants to force Anguilla into Bankruptcy by blocking the Government, I fully support the Government taking us into Independance without delay.

    The Speaker, if he is a true Anguillian Nationalist, would never intercede to stop Government.

    Mr. Mitchell, you are attempting to sow seeds of faer by suggesting that Government ministers would be personally liable for any debt they incur qua Government, authorized by the British or not.

    Further, the Court cannot inquire into the proceedings of the House: David Carty Case against the former Speaker, Hughes case against the former Speaker.

    Once the Speaker allows it, there is nothing the British can do, short of another bullying invasion, to stop it. Nor can anyone else.

    I do not support the UF. I support ANGUILLA! I support the Government, whichever "Party" of combination of persons comprise it. What the Government wants to do is best for us right now. I support them on this.

    Cut the Republicanesque fearmongering please.

  3. Financial Times, London
    Troubles in paradise
    By Michael Peel, Legal Correspondent
    September 3 2009 03:00

    The Cayman Islands are the latest British-linked tax haven to face financial pressures that could leave London to pick up the
    final bill, writes Michael Peel .

    UK-connected offshore centres from the Channel Island of Jersey to the Caribbean territory of Anguilla have been grappling with
    how to fill holes in their public finances.

    The problems - often microcosms of the battles that big economies are facing with ballooning budget deficits during the economic
    downturn - highlight how troubles in paradise islands are an increasing problem for Westminster as well.

    The argument over whether Cayman will have to introduce income and sales taxes for the first time has echoes of a debate in
    Jersey in 2007.

    The Channel island contentiously put in place a 3 per cent sales tax last year, in what ministers said was an essential measure
    to make up a shortfall in government revenues of between £80m and £100m.

    While Jersey's status as a Crown dependency means it is independent of the Westminster parliament, overseas territories such as
    Cayman are technically British possessions and thus a potential financial liability for the Treasury.

    Britain is already picking up the tab for a political takeover last month of the Caribbean overseas territory of the Turks and
    Caicos Islands, where the constitution has been suspended for up to two years over allegations of widespread corruption.

    The Foreign Office said it has also sent a Cayman-style warning about the health of the public finances of Anguilla, a tiny
    Caribbean offshore financial centre most famous as a holiday playground for celebrities.

    Copyright The Financial Times Limited 2009.

  4. Cayman Islands: Hit by Hurricane Lehman
    Editorial, The Guardian, 3 September 2009
    Gustav, Ivan, Paloma: the Cayman Islands have withstood many a hurricane. Now, however, it faces the perfect storm: Hurricane Lehman. This one has been brewing since September last year, when America's Lehman Brothers went belly-up and brought the global banking crisis to its climax. The Cayman Islands relies for income on financial services and tourism, so it has suffered terribly ever since. And now the country, home to trillions of dollars of assets held by hedge funds and multinational businesses, has run out of cash.
    A budget black hole means that civil servants are no longer getting all their pay and the government is considering imposing new taxes on islanders. First, though, it is trying to raise emergency funds from banks. To do so, the British overseas territory needs to gain permission from their ultimate masters at Westminster. And there lies the rub. Writing to the Cayman government's leader last week, Chris Bryant declined the request, and pointed out that the islands' entire business model was bust. That is a sound judgment: the US and other economies remain weak, hedge funds and the rest of the financial services industry are still getting over the worst market crisis in decades, and secretive tax havens such as the Caymans are under pressure from the OECD and the G20 group of rich countries to become more transparent. The same diagnosis surely applies to Jersey, Guernsey and the Isle of Man. As Mr Bryant says: "It would be unwise ... to expect that the Cayman Islands' prosperity can presume on an offshore tax haven status."
    The palpable relish in that sentence is surely no accident. For those like The Guardian who want a more open and fairer tax system, this is a moment rich with possibilities. Not only is pressure building on the G20 leaders to tackle tax dodgers, but the world's boltholes for the rich are finally learning that tax avoidance does not pay. As more British dependencies have to call on ministers for assistance, Westminster can demand they clean their act up.
    Let ministers start with the Caymans. As a condition for acceding to another loan, they can demand that the islands' government institutes automatic exchange of tax information with all countries, rich and poor alike. They can also request that no taxes are introduced that hit the Caymans' poor while letting off the wealthy. The Cayman government should not tax money sent home by relatively hard-up immigrants, for example. Finally, Westminster needs to work with the Caymans on making its economy less reliant on passing cruise ships and fly-by-night financiers. As the UK government also knows, a lopsided economy will always eventually crash.

  5. Keep it simple.
    Less revenue = less spending.
    Government must live within it's means.
    I think that this GOA has lost the confidence of the people by previous actions and they will be questioned forever. Hubert, when he says this is now a lame duck government seems to have merit to his statement. We need an election as soon as possible and with a new government we can investigate our finances over the last 8 years or so, find out where our revenue went.
    Hopefully Eddie will get his request for information granted and then he can begin to scrutinise for himself.
    We really need to investigate why we are in so much need after 5 years of non stop growth.


    When WE THE PEOPLE agree that the Government has cut out the waste in certain areas and WE agree that ANGUILLA has a need to borrow a minimum amount of money, then the government should go to the House of Assembly and pass the motion.

    It would be quite WRONG, DANGEROUS and FOOLISH for the United Front Organization to go to the House of Assembly before they have a couple Town Hall meetings with the people of Anguilla and have the full support of the people for the borrowing. Then WE will hear what THE BRITISH have to say. The point is that THE FRONT cannot ignore THE BRITISH and ignore THE PEOPLE OF ANGUILLA.

    I hope that the Front is taking proper legal and strategic advice, so that they do not put Anguillians in the undesirable position of having to fight THE FRONT on one hand and THE BRITISH on the other.

    We want openness and transparency. How much money does the government of Anguilla owe at present, how much do they need to borrow and what areas can there be spending cuts.

    Come on guys, what you plan to do is not the problem-the problem is how you do it. Do it right, consult the people, be like OBAMA.The answer is responsible borrowing AFTER full consultation with the people. Beat the BRITISH at their own silly games!

    We can and we will repay our loans. We are an honourable people.

    NO grants and no borrowing? So what are we suppose to do? How many billions have THE BRITISH borrowed already? The bloody nerve of those hypocrites!

  7. Mr. Mitchell,

    Chris Bryant and the FCO are using underhand methods to force Anguilla to impose income tax.

    Anguillians work for very low wages, income tax will serve no useful purpose. Our system of import duty (taxation) is more productive.

    I thought blackmail was illegal. I suppose what is illegal depends on who does it!


  8. Gordon Barlow writing in today’s Cayman Net News
    has an excellent article on why introducing new taxes is a bad idea.

  9. "Chris Bryant and the FCO are using underhand methods to force Anguilla to impose income tax."

    No, they are trying to get Anguilla off their hands by inciting patriotism and making us choose the indipendence route. They would like Anguillas liability off their books.

  10. Oh please, stop trying to fool the public!

    England has absolutely no intention of letting go of the COLONIES.

    What would England be without Scotland, Wales and the COLONIES?

    A very small island divided into (3) three.

    The colonies are absolutely no burden to England. It is the elephant(England) on the turtle dove's(anguilla) back and not the other way around!


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