As part of ongoing efforts to implement reforms suggested by the 2022 Commission of Inquiry report, the government is working with the Commonwealth Secretariat to improve the way public debt is managed in the Virgin Islands.
Last month, officials from the Commonwealth Secretariat’s Debt Management Unit and the VI Ministry of Finance’s Macro-Fiscal Unit led an 11-day self-assessment of the VI’s debt management practices.
The resulting report addresses all aspects of the processes by which the territory manages its debt, government stated in a press release.
Analysis generated from the report will be used to guide future reforms, according to acting Deputy Financial Secretary Dr. Drexel Glasgow.
“Following submission of the assessment, the Commonwealth Secretariat will develop a five-year programme to facilitate the implementation of the measures identified,” Dr. Glasgow said in the release.
Assessment leaders
The self-assessment, which concluded on Sept. 29, was co-led by Ministry of Finance Policy Analyst Michele Richmond-Phillips and Delia Cox, a Commonwealth Secretariat debt management advisor who focuses on the Caribbean.
The process included meetings with Premier Dr. Natalio “Sowande” Wheatley; representatives of several government departments and statutory boards; and members of the private sector.
The London, UK-based Commonwealth Secretariat is the central institution of the Commonwealth of Nations, a group of 56 states composed mostly of former territories of the British Empire.
The Commonwealth has supported VI government debt management reforms in the past with technical assistance, capacity-building support, and advice on debt management system, according to the DMU’s acting head, Mac Banda.
COI report
According to the 946-page COI report issued in April 2022, the VI’s debt was estimated in excess of $210 million at the end of 2020. That included some $66.6 million borrowed by statutory bodies but ultimately guaranteed by the VI government.
The COI, led by UK-appointed Commissioner Sir Gary Hickinbottom, heavily scrutinised the way the VI government spends public funds.
Mr. Hickinbottom noted that the UK’s relationship with its overseas territories makes clear that financial management is a “devolved responsibility” to the VI, but he noted that the UK has a strong interest in the territory’s financial management.
“Insofar as they seek to make a constitutional point that the UK government would be wrong to seek to impose any restraints on the fiscal policies of the elected government because financial matters are a devolved area, such a proposition is obviously hopeless,” he wrote in the 2022 report.
“As the holder of contingent liabilities in respect of BVI government debt, the UK government is clearly entitled to see some restraints on BVI fiscal policy, by agreement if possible … or by imposition if necessary.”