State Secretary Raymond Knops signing the letter informing the public entity Saba that it will be receiving an additional US $1 million in funding. (BZK photo)
SABA--The public entity Saba will receive a one-time amount of US $1 million from the Dutch government. State Secretary of Home Affairs and Kingdom Relations BZK Raymond Knops wants to add the money to the 2021 free allowance, allowing Saba to take its own decision on how to spend these funds, he informed the local government in a letter on Friday, March 12.
Knops: “I have been consulting with the Saba Executive Council for a while about the amount of the free allowance and the shortage of structural means. Saba has in the past years shown that it has its financial management [in order – Ed.] and [engages in] the rightful spending of means. With this contribution I want to accommodate Saba.”
Saba has little liquidity in comparison to Bonaire and St. Eustatius, the two other public entities in the Caribbean Netherlands. As a result of this, Saba has had to increasingly use incidental means to cover structural cost.
The addition of the intended $1 million to the free allowance will be finalised after approval of the Dutch Parliament.
“In the longer term, we will work towards a structural solution through the advices from the Council of State investigation and the Intra-Departmental Policy Review,” said Knops.
Saba Commissioner of Finance Bruce Zagers is “very content” with the contribution from the BZK ministry. The public entity can use this additional financial contribution to help finance areas in the 2021 budget that were lacking due to the shortage of means.
“Although this is only incidental financial assistance, it will go a long way in allowing the public entity to meet its legal obligations without having to reduce the quality of services. It will also improve the liquidity position, which has been weakened during the past few years,” Zagers said.
The 2021 budget, approved by the Saba Island Council in November last year, showed a deficit of more than $1.3 million. This was the first time that Saba presented a budget deficit since it became a public entity of the Netherlands in 2010.
The free allowance in the 2021 budget was a little more than $10.2 million, an amount that has basically remained the same since 2012.
The free allowance is insufficient to cover government’s structural and operational cost. Only the most urgent needs were accounted for in this year’s budget, covering government’s basic legal obligations, such as the payment of salaries, keeping the offices open and providing the necessary services to the public, Commissioner Zagers said during the budget’s presentation.
The budget lacks the means for structural investments and the upkeep of infrastructure. “Hopefully, the negotiations with the new Dutch government will bring structural solutions for the structural financial problems. However, we are very appreciative for this support. It is another confirmation of the good relationship which has been built based on respect and trust between Saba and the Netherlands, and it confirms the ‘More for more’ approach of State Secretary Knops,” said Commissioner Zagers.
