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Board of Financial Supervision visits Sint Maarten.

cftvisitssxm18012012Philipsburg:--- The Board of financial supervision (College financial toezicht – Cft) visited Sint Maarten the last few days. Under the new chairmanship of prof. Age Bakker, the Board conducted meetings with the Finance Minister, Mr. Hiro Shigemoto, the Governor, Mr. Eugene Holiday, the Council of Ministers and Parliament. This was the first time the new member of the Board Mr. Richard Gibson and the new secretary of the Board, Mr. Kees van Nieuwamerongen participated in these meetings. It is expected that a new member of the board to replace Margo Vliegenhart, who has resigned, will be appointed shortly. During the visit a Memorandum of Understanding was signed with Sint Maarten and the Cft offices on Sint Maarten was opened.

The opening of the office and the signing of the Memorandum of Understanding are the result of the further developing cooperation between Sint Maarten and Cft. This cooperation is of great importance to continue building up country Sint Maarten and foster sound public finances.

During the meetings an array of topics were discussed, such as the budget, the accountability, corporate governance and financial management. It can be concluded that there has been progress on all areas, although at the same time there are still many challenges ahead. Currently Sint Maarten does not have an approved budget for 2012 as yet. Sint Maarten requested Cft to advise on the draft budget, before submitting this to Parliament. Cft is pleased that Sint Maarten decided to do so. In this way Parliament will be informed of the Cft views on the draft budget, and will be in a position to include this in their deliberations. The expectation is that the draft budget will soon be presented to Parliament and Cft hopes that the budget will soon be adopted. A fast adoption of the budget 2012 means also that preparations for budget 2013 can be started timely, in order for these to be adopted within the legal terms.

The budget 2012 will have to be executed under difficult economic conditions. Economic and financial uncertainty is eminent worldwide. It may therefore be necessary to adjust the budget during 2012. In addition the Cft indicated to the government the risks in the multi-year budget as far as pensions and social security is concerned. Countries all over the world are confronted with increasingly unmanageable costs in these areas, other than was originally expected when these systems were designed. It is therefore prudent to obtain timely insight on these matters on Sint Maarten and to plan to effectively cope with potential problems. Cft welcomes the fact that Sint Maarten is taking steps to significantly improve the tax system. The Board has recommended the Council of Ministers to also consider adopting a dividend policy for government owned companies. This will contribute to transparency and proper allocation of all public funds. Parliament however, is the ultimate decision maker as far as this is concerned.

Sint Maarten is a young country that is working on building its institutional capacity and developing its general financial management. So there is at present a backlog in the preparation and auditing of financial statements. It is important to complete and audit financial statements of the past. Cft is pleased to have learned that the financial statement 2010 is completed and has been submitted to the required advisory bodies. In a wider context, Cft has emphasized the importance of the adoption of the Public Expenditure Framework Assessment (PEFA) as the basis for a roadmap to strengthen financial management in future. This process should in the end lead to a financial management that is in compliance with internationally acceptable standards. This will support institutions such as Parliament to carry out its role. Cft applauds these steps that Sint Maarten is taking in this area. The building-up of a country brings along challenges for the government and the leadership of the country.

With the opening of the new office and the close cooperation Cft is confident in the future of Sint Maarten.

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