Saba, Statia get more flexible financial supervision in future

Financial su­pervision for Bonaire, St. Eu­statius and Saba will become more flexible in the future. A law proposal to facilitate this is currently in consultation and should be at the Second Chamber of the Dutch Par­liament before the summer of 2023.

Dutch State Secretary of Home Affairs and Kingdom Relations Alexandra van Huffelen announced this in an update that she recently sent to the Second Cham­ber regarding the proposal to amend the FinBES, the financial supervision law for the Caribbean Netherlands. The FinBES not only regu­lates the financial function of the public entities Bonaire,

St. Eustatius and Saba, their fiscal authority and financial relations with the Dutch gov­ernment, but it also regulates the financial supervision by the Committee for Finan­cial Supervision CFT Bo­naire, St. Eustatius and Saba, which resorts under the re­sponsibility of the minister of Home Affairs and Kingdom Relations.

Financial supervision is a heavy standard element in the current FinBES, Van Huffelen explained. Finan­cial supervision is not flex­ible and does not lead to less supervision when the public entities comply with their obligations. This especially counts for Saba, which has been largely complying with the financial supervision norms.

On the other hand, when the public entities don’t com­ply with the financial supervi­sion obligations, it is complex to “scale up, because there is already a lot of supervision,” stated Van Huffelen.

“The effectiveness of the supervision can be increased by specifying the supervision. Therefore, this law proposal contains a proposal for a step model of financial supervi­sion with a differentiation between a light, medium and heavy model,” she stated.

The decision which model will be applicable per public entity will be taken annually based on the adapted law and a financial supervision framework. “Bonaire, St. Eustatius and Saba are each in a different phase in hav­ing their finances in order,” stated Van Huffelen.

“Differentiation can be made between the islands by applying the different models of supervision and guidance. In this manner, the intensity/ weight of the supervision can move along with the state of the budget and the island’s financial management, and can be customised. In other words: the supervision model is applied where it is really necessary,” the state secre­tary noted.

In a case where the island complies with the regula­tions and agreements of the FinBES, financial supervi­sion can be reduced to a level that is comparable to the situation for Dutch munici­palities.

In such a scenario, the pub­lic entity will have more ma­noeuvring room to carry out its own responsibilities and the financial supervision will weigh less on the capacity of the island’s finance depart­ment. The system is based on mutual trust.

The Daily Herald.

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