Cft Chairman Age Bakker: ’Positive result of 2014 good basis for execution of measures regarding social funds and governmental companies‘

During the first two months of 2015 Curaçao has worked on reducing the deficits in the social funds and the governmental companies. “2014 is expected to close with a positive result. That is a nice performance. 2015 will have to be dedicated to the managing of the financial risks the social funds and the governmental companies impose,” according to the Chairman of the Board Age Bakker.

Persconferentie Cft 20150226 (1)

During the last week of February the Board of financial supervision for Curaçao en Sint Maarten (Cft) visited Curaçao. There the Board spoke with the Governor, the Council of Ministers, the minister of Finance and the Financial commission of the Parliament. The Board also received a guided tour on the construction site of the new hospital HNO and discussed the progress with the executing organization Usona.

Results 2014
It is expected that Curaçao will close off 2014 with a positive result of ANG 37 million. This will be added to the swinging fund (schommelfonds) to partially balance the deficits at social funds, and is furthermore used to compensate the deficits from previous years. With this addition the deficits from the years 2010 up and till 2012 will almost completely be compensated. The taxes received are in line with the downwardly adjusted framework of receivable taxes.Persconferentie Cft 20150226 (2)

Execution 2015
The budget for 2015 was adopted in a timely manner. In principle the budget is balanced, assuming that the proposed pension reform of the civil servants will indeed be realized in the short term. However the Board observed a number of risks for the budget. These concern the social funds (in particular the AOV-Fund) and a number of governmental companies. The government is preparing measures to curb these risks.

With regard to the AOV fund the deficits that resulted to be higher than initially expected, will be controlled by an increased compliance, because of which more premiums will be received. Additional actions are the freezing of management costs and the reduction of the payments to non-residents. Control measurements are being taken for the BVZ- fund as well, but the rising exploitation costs from the SEHOS causes concern.

Furthermore the Board advised Curaçao to elaborate on a concrete step plan including timeline to make the financial position of a number of governmental companies (CDM, Aqualectra, CPost and ADC) sound again. Curaçao has been working on that and the first measures are already in execution. In addition a national ordinance is currently in preparation, which will lay a legal foundation for all government entities to improve efficiency in the area of compensation, personnel expenses, procurement and dividends. The Board expects to receive shortly the complete review of the remaining measures. The Board again emphasizes the joint responsibility of the management, the council of commissioners and the government as shareholder. The identified measures, including the reduction of personnel costs, can only be executed successfully if all shareholders cooperate.Persconferentie Cft 20150226 (3)

New Hospital in Otrobanda
Finally the Board visited the construction site of the new hospital. The second part of the loan for the new hospital has been requested at the end of 2014 and obtained at the beginning of against 1.25%. With this Curaçao now has the financial means to build the new hospital. A successful transition from Sehos to the new HNO however requires more than solely blocks, it also requires a new way of thinking and working. It requires decisiveness. A tight government control is necessary so the new hospital can offer qualitative and good health care in a businesswise responsible manner.