A planned increase of the one per cent foreign exchange transaction licence fee to between 1.7 and 1.9 per cent is apparently off the table, at least for St. Maarten (see related story). The Curaçao government wanted to use the additional revenues to help address the Girobank crisis, but that did not go down well in Philipsburg.
Finance Minister Ardwell Irion informed the Central Bank of Curaçao and St. Maarten (CBCS) during a meeting that he and the rest of the interim Jacobs Cabinet do not support any such local hike. Whether there can be different international transaction levies for the two Dutch Caribbean counties in the monetary union was not immediately clear.
Both Curaçao Finance Minister Kenneth Gijsbertha and CBCS Supervisory Chairman Etienne Ys say an arrangement for the insolvent commercial bank so clients can access all their funds in a phased manner should be ready by month’s end. What that will look like remains to be seen, but Curaçao’s general pension fund APC and its banking licence may be involved.
Speaking of pensions, Parliament is set to debate a draft law to amend the Ordinance on Civil Service Pensions today, Thursday afternoon. The biggest changes are raising the pensionable age to 65, employees starting to contribute from the age of 18 instead of 25 to build up higher benefits, and basing the amount on average rather than last salary.
According to St. Maarten’s general pension fund APS, agreement on the reforms was reached with the relevant unions in 2017. There now seems to finally be some light at the end of that tunnel of more than two years.
This is important not just to ensure the fund’s long-term viability but also for public finances. It’s one of the conditions to keep receiving much-needed liquidity support from the Netherlands since the devastating impact of Hurricane Irma.
Another one is Members of Parliament (MPs) taking a pay cut as the Council of Minsters did before. Sarah Wescot-Williams of United Democrats (UD) has suggested this would require an entire legislative process and two-thirds majority backing.
Instead, several allowances and other secondary benefits can be removed or adjusted to produce similar savings.
If that is true, an effort should be made to in any case discuss this option and its feasibility rather than continuing the current stalemate. That can only work if the two sides adopt a solution-oriented approach.