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Fund ‘safeguard’
PRIME MINISTER MIA AMOR MOTTLEY has announced a change to the Economic Diversification and Growth Fund Bill 2025, signalling Government’s willingness to strengthen transparency and accountability measures following a number of concerns over the past week.
She told the House of Assembly yesterday that her administration will introduce an additional safeguard – despite the Bill having been passed in the House last Friday – through a regulation requiring the minister responsible to formally account to Parliament whenever there is a deviation from recommendations made by the Bill’s Advisory Committee or the National Growth Council.
Mottley stressed that while ministers should not be reduced to “rubber stamps”, the proposed adjustment would strike an appropriate balance between ministerial discretion and public accountability. Under the proposed change, any such deviation would have to be laid in Parliament, along with clear reasons.
Strong and transparent
“I am satisfied that we have strong and transparent guardrails,” the Prime Minister told parliamentary colleagues, adding that the private sector’s request for this additional layer of oversight could be accommodated without difficulty.
Last Friday, Minister in the Ministry of Finance Ryan Straughn, in piloting the legislation in the House, said it sought to “establish a fund, to be known as the Economic Diversification and Growth Fund, to provide financial support to certain companies to increase employment, earnings of foreign exchange and economic growth in Barbados”.
He added it will be capitalised by an initial $225 million “to be drawn from the Consolidated Fund over a three-year period in annual instalments of $75 million”.
However, attorney and consumer advocate Tricia Watson, in an online post, was harshly critical of the measure, saying, among other things, that it was being set up to “give our money to substantial foreign companies”.
“There is no requirement for the Government to disclose who will get our money. There will be no accountability for what happens with this fund! This is ridiculous!” she lamented.
Then in Monday’s DAILY NATION, Professor Don Marshall, head of the Sir Arthur Lewis Institute of Social and Economic Studies at the University of the West Indies, Cave Hill; Professor Troy Lorde, dean of the Faculty of Social Sciences at Cave Hill, and economist Jeremy Stephen questioned whether the Bill, as drafted, provided the policy clarity, governance safeguards and inclusive development framework needed to justify drawing $225 million from the Consolidated Fund.
Mottley, in a statement to the SUNDAY SUN, and then in a television broadcast on Sunday night which was repeated on Monday night, defended the Bill, saying there would be no investment or subsidies given to any foreign company that does not significantly expand employment in Barbados by providing more than 100 jobs and earn foreign exchange for the Barbados economy.
She also said these companies will pay tax at nine per cent and not the reduced rates of 2.5 per cent declining to 1.5 per cent that existed previously.
She maintained the Bill was designed and would be implemented with clear objectives – to protect and grow jobs, enhance foreign and domestic investment, and grow the economy for all Barbadians.
Overall intent
Yesterday in Parliament, she again defended the overall intent of the legislation, arguing that the $75 million annually in targeted subsidies must be viewed in context. She noted that Barbados already forgoes more than $875 million each year in tax concessions and waivers across sectors such as tourism, agriculture, housing and manufacturing.
“The $75 million is not even ten per cent of what the Government of Barbados is waiving consistently in tax concessions and tax waivers on an annual basis,” she said, pointing out that unlike tax concessions, direct subsidies are more visible and therefore more likely to attract public scrutiny.
The Prime Minister also placed the legislation within a wider global shift away from profit-linked tax incentives towards cash grant and costbased investment support mechanisms.
She cited examples from countries like the United Kingdom, Singapore, Vietnam and the United States, all of which, she said, have increasingly adopted direct funding and grant-style incentives, particularly in response to the Organisation for Economic Cooperation and Development’s global minimum tax regime.
Mottley said these approaches were designed to support high-value sectors such as research and development, innovation and advanced manufacturing, while preserving countries’ fiscal space under new international tax rules. She warned against what she described as misinformation surrounding the initiative, suggesting that a lack of understanding about global economic shifts was fuelling unnecessary anxiety.
“This is a matter of fundamental import,” she said, cautioning that mischaracterising the legislation could undermine economic stability and household security in Barbados.
The Prime Minister also addressed long-standing public sector human resource challenges, reiterating that it was “completely unacceptable” for workers to go months without being paid.
She reminded permanent secretaries that they already have the authority to recommend urgent payments once work has been verified, while encouraging affected individuals to seek assistance through her office or the Office of Citizen Engagement and Media Relations. (CLM) Please see also Pages 4 and 13 for more reports from Parliament.
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