I was shocked at budget error but I have confidence in the Premier

Deputy Premier and Labour Minister Lorna Smith

Deputy Premier Lorna Smith has expressed her surprise and disappointment over a $20 million budget miscalculation surrounding the new salary structure for public servants in the territory but said she strongly supports Premier Dr. Natalio Wheatley’s response to the issue.

Smith noted that the miscalculation was only discovered in April 2024, months after the budget passed in December 2023. The Premier and the Ministry of Finance discovered then that the amount required for the new salary structure was significantly higher than what had been budgeted.

Premier Wheatley outlined the details of the miscalculation, explaining that the budget allocation was based on a compensation review led by the Deputy Governor’s Office and PricewaterhouseCoopers (PwC). However, he related that “problematic assumptions” in the review led to a significant variance between the budgeted amount and the actual funds required.

“The Premier was very specific about it. He said that he heard or it came to his attention that this excess amount of $20 million for salaries was identified in April of this year,” Smith explained. “I, myself, was shocked, outraged, and disappointed, to put it mildly, when I heard about it.”

The original budget had allocated approximately $11.7 million for the new salary structure. However, an analysis by the Ministry of Finance revealed that more than $25 million was needed.

“I have full confidence in the Premier and the way in which he has handled this matter once it came to his attention,” Smith said. She noted that the Premier had called for an investigation into the miscalculation, and she was present when he expressed his “shock” and “horror” to the governor over the discovery.

Smith stressed the importance of accountability within the government, particularly in the ministries responsible for public service and finance. “We cannot, as senior public servants, be making that kind of grave mistake,” she said. “The financial implications, as has been said, are significant, and we must find a way to come up with a solution in terms of making up for this $20 million deficit.”

“It is a very serious matter, and as I’ve said before, we have to deal with it expeditiously. We cannot sweep it under the rug; we cannot kick any can down the road. We simply have to deal with it head-on,” the Deputy Premier added.

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