Premier explains about-turn in paying out $7M

in All News / By: BVI News Online on May 26, 2017 at 6:35 AM /

Premier Smith. File photo

Premier and Minister of Finance Dr D Orlando Smith has tried to explain his about-turn regarding the time-line in paying out a subsidy amounting to $7 million to the privately owned BVI Airways.

He initially stated that the funds would have been paid conditionally over a three-year period.

But the full amount was paid out instead within a few months – from January 22 to August 26, 2016.

In noting the major time difference, Leader of the Opposition Andrew Fahie this month sought answers from the premier during a sitting of the House of Assembly.

The Opposition leader noted that the payout schedule in the contract between Government and BVI Airways “spans three years, and it is conditional that the airline must satisfy certain performance in order for each payment to be made”.

In response, Premier Smith indicated that the parties to the contract opted to change the payout schedule partly due to delays in BVI Airways acquiring approvals to start flying direct between the United States and the British Virgin Islands.

He also noted that there were various challenges in BVI Airways acquiring aircraft to fly the route.

Premier Smith explained: “Conditions for the release of funds to BVI Airways were primarily based on timelines that were adjusted by mutual agreement as conditions on the ground changed. These were related to the extended anticipated time for getting approvals from the regulator, and various challenges faced in the acquisition of the aircraft required to provide the service.”