The Cft notes with satisfaction that Bonaire, after budgeting for a deficit for several years, now complies with the central balance standard of the Public Bodies of Bonaire, Sint Eustatius and Saba Finance Act for several years,” the Financial Supervision Board said about the draft budget for 2024.
Bonaire presents a balanced budget in 2024, followed by budget surpluses in the years 2025 (USD 1.4 million), 2026 (USD 1.4 million) and 2027 (USD 1.8 million). Investments of 16.3 million dollars have been budgeted for next year, rising to 22.6 million in 2027. A large part of the investments is intended for improving the road network.
On the Advice on the 2024 draft budget CFT sent a letter to Oleana:
Dear Mr Oleana, On August 10, 2023, the Board of Financial Supervision Bonaire, Sint Eustatius and Saba (Cft) received the draft budget (OB) for the 2024 financial year of Bonaire. With this letter you will receive the Cft’s advice on this OB.1 The OB that Bonaire offers to the Island Council must be accompanied by this advice, indicating how the Cft’s findings and recommendations have been taken into account. In appendix 1 of this letter you will find a further explanation and numerical support for this advice.
Judgment
The DB shows balance in 2024 and limited surpluses in the period 2025-2027. The Cft notes with satisfaction that Bonaire, after budgeting for a deficit for several years, now complies with the central balance standard of the Finances for Public Bodies of Bonaire, Sint Eustatius and Saba Act (FinBES Act) for several years.
Bonaire explains the multi-year policy priorities of the Executive Council in detail and clearly in the OB, but the financial translation of these, in the opinion of the Cft, can be further improved. For example, Bonaire only includes the structural special benefits in the OB, which means that the budget is not complete. The budget is, as prescribed, classified on the basis of the functional classification. In addition, to the satisfaction of the Cft, Bonaire also includes an overview based on economic categories. However, this overview is not further explained, which means that the Cft cannot form a proper assessment of the reality of the charges in particular. The Cft requests Bonaire to process the special benefits in the OB on a multi-year basis, and to further explain the charges based on economic categories.
Explanation
Bonaire presents a balanced budget in 2024, followed by budget surpluses in the years 2025 (USD 1.4 million), 2026 (USD 1.4 million) and 2027 (USD 1.8 million). The Cft has been calling for a realistic budget for some time, in which both Bonaire’s ambitions and its implementation power are expressed.2 The increase in the free allowance and the additional benefits from the tourist tax ensure a structural increase in benefits.
The OB does not include all expected benefits and costs for both 2024 and the multi-year period, which means that Article 3 of the BES Budget and Accountability Decree is not complied with. Bonaire only includes the structural special benefits in the OB and only processes the other special benefits in the budget with the first budget amendment (BW) 2024. As a result, the OB does not provide an accurate picture of the actual size of the budget and the steering capacity is. The budget is limited. In addition, especially given the fact that the special benefits form a substantial part of the budget, the framework-setting role that the Island Council has in determining the budget is also limited.
This method of accountability also means that the budget, implementation reports and annual accounts together do not provide consistent, clear and systematic insight into the financial position of the public body during the financial year. While the budget does not contain any special benefits, the income and expenses in the implementation reports and the annual accounts are presented including the income and expenses associated with the special benefits. This not only limits insight into the regular operation of the public body, but also means that the multi-year estimate cannot be compared with the recent realization. A correct benchmark is therefore lacking. The Cft therefore requests Bonaire to separate regular income and expenditure from the income and expenditure associated with special benefits during budget implementation.
Strengthening the executive power of the public body is an important theme in the budget. Bonaire introduced the senior scheme in 2022, which allows civil servants to voluntarily retire early. The impact of the seniors scheme on the effectiveness of the public body is not explained in the OB. It is also not clear what effect the seniors scheme has on the multi-year personnel costs of the public body. The Cft requests Bonaire to clarify both points in the budget.
Bonaire presents a multi-year investment plan in the OB. This shows that Bonaire budgets USD 16.3 million in investments in 2024, rising to USD 22.6 million in 2027. A large part of the investments in 2024 is intended for improving the road network. Bonaire adequately explains the proposed investments in the OB, but the multi-year impact on the regular service is not specified. The Cft advises Bonaire to further explain the effect of the investments on maintenance costs in the budget.dossierkoninkrijksrelaties.nl
