Short-Term Relief Benefit

Mr. Speaker,

This morning I rise before this Honourable House very much pleased to introduce the Bill entitled the “Financial Assistance (Short-Term Relief Benefit) Act 2024”.

This Bill seeks to establish a framework to provide immediate financial support on a short-term basis for persons who qualify in the event of experiencing financial hardship due to unforeseen circumstances. This is a new financial assistance benefit.

Mr. Speaker,

This initiative was a commitment in the 2022 Speech from the Throne when the Department of Financial Assistance fell under the remit of the Ministry of Economy and Labour.

As highlighted in the Throne Speech, this initiative was part of the Financial Assistance Reform and, would assist households requiring immediate assistance with expenses for a short period, due to sudden hardships such as involuntary job loss or a death in the family.

Mr. Speaker,

I remind my Honourable colleagues that the COVID-19 Pandemic demonstrated that there was nowhere for Bermudians to seek immediate financial support in the event of impending unforeseen circumstances. Resultantly, in September 2020, the Government showed its commitment to Bermudians by implementing a Supplemental Unemployment Benefit so persons could have access to immediate financial support. Noting that many families were still being impacted, the Supplemental Unemployment Benefit was extended on several occasions until it ended in November 2022.

However, Mr. Speaker,

Since the Supplemental Unemployment Benefit was relinquished, there have still been Bermudians who continue to experience financial hardship due to unforeseen circumstances; and who have no options to meet their immediate basic needs while taking steps to rectify their financial predicament. As contributors to our economy, this tends to place a mental burden on these persons inhibiting their ability to maintain their livelihood. Research shows that individuals and households who find themselves in these circumstances are less resilient because they cannot meet their basic human needs and despair begins to set in.

Mr. Speaker,

As I look around this morning, every one of us in this Honourable House depends on a level of income in some way or another to meet our daily needs whether for housing, food, transportation, utility bills, insurance, health care, education, or even to take care of our parents, the list continues.

If we just pause for a moment, make this personal and imagine the impact that would have on us if we experienced a sudden loss of income from losing a job or a death in the family of the main breadwinner; and, what position that would place us and our families in and its effect - anxious, emotionally stressed, fearful, insecure and uncertain about the future, hopeless, depressed and even angry trying to maintain our financial obligations.

This mental anguish can cause conflicts and tensions within our respective individual family units as we try to support each other while adjusting to a different way of living. Absolutely no one is immune from this type of situation.

Mr. Speaker,

It is important that we recognize this experience of financial hardship would not only affect our immediate families and children but also our extended families as well and eventually a spill-over effect into our communities will be unavoidable.

But, Mr. Speaker,

I’m sure each of us here today would want to know that we have a Government that understands, cares, empathizes and plans for its people to the point that a structured framework is put in place to support families and households that suddenly experience financial hardship due to unforeseen circumstances and who ultimately need help.

Mr. Speaker,

Let me cast the minds of my honourable colleagues back to 2017 when a Financial Assistance Reform Group was initially established. The mandate of the Financial Assistance Reform Group was to assess the effectiveness of the Financial Assistance Programmes in achieving its objectives, emphasising areas where legislative and/or policy reform may be required to improve service delivery. From this assessment, the Reform Group made recommendations for financial assistance reform. Mr. Speaker, my Honourable colleagues, Minister Jason Hayward, Minister Michael Weeks, MP Susan Jackson and myself were all members of the Financial Assistance Reform Group.

Mr. Speaker,

The Reform Group worked diligently undertaking this assessment and in 2019, the Group successfully delivered 30 recommendations for financial assistance reform and to ensure a more equitable allocation of financial awards for achieving financial sustainability. Mr. Speaker, one of the recommendations emanating from this assessment was to: develop and introduce a bona fide unemployment insurance scheme which would benefit persons who find themselves transitioning between jobs or who remain unemployed over a period of time, reducing the strain on Financial Assistance.

Mr. Speaker,

Stemming from our country's experience during the COVID-19 Pandemic and the need for the Supplemental Unemployment Benefit, this recommendation from the Financial Assistance Reform Group has now morphed into a Short-Term Relief Benefit programme that will be governed by legislation. This Bill entitled: “Financial Assistance (Short-Term Relief Benefit) Act 2024”, will steer the Short- Term Relief Programme in the Department of Financial Assistance with the following features:

1. Eligibility: Qualifications of a person to apply for the benefit and the stipulated criteria that must be met;
2. Amount: The benefit is a legislated $1,500 per month
3. Duration: Recipients can receive the benefit for up to three (3) months in a financial year.
4. Process: Every application for the short-term relief benefit must be made in writing on an approved form submitted digitally or in person to the Director; with documented proof of eligibility; and evidence of sudden financial hardship.
5. Conditions: The benefit recipients must comply with specified conditions in the Bill some of which include notifications to the Director of any financial change in one’s circumstances while receiving the relief benefit, any sudden change that would make one ineligible for the benefit, of any intention to travel outside of Bermuda and if one becomes a recipient of a financial assistance award under the Financial Assistance Act 2001.

Mr. Speaker,

The short-term relief benefit payment is payable to individuals, not to households. Individuals must apply and then prove that they are experiencing the sudden hardship and the impact it may have on their household. For example, if a person has been made redundant from their job or is a victim of domestic violence, that specific individual would apply for the short-term relief benefit for a maximum of three months in that they would receive a total of $4,500 per year.

The individual unemployed would need proof from their former employer while the victim of domestic violence would need proof from either a helping agency such as the Centre Against Abuse or a police report.

Mr. Speaker,

In the case of victims of domestic violence when they eventually muster the courage to flee from their home environment because of abusive behaviours, the offending partner would often decide to block their access to funds by closing bank accounts and cancelling credit cards so that the victim has no financial means. Persons experiencing this can apply for the short-term relief benefit.

Mr. Speaker,

The negative implications of not providing persons experiencing financial hardship with a short-term relief benefit could be very serious to families and include:

• Arrears in paying their monthly rent/mortgage
• The potential of eviction from their homes
• Loss of income for Landlords
• Disconnection of electricity for non-payment
• Forgoing needed medications that could result in health challenges or even death
• Limiting access to critical care or food, and
• Inability to fulfil other pertinent household obligations

Mr. Speaker,

Some may say that a Short-Term Relief Benefit will create disincentives for persons to intentionally look for work, that it may reduce the labour supply, or even increase a sustained financial dependency on the Government. However, this is not the intent of the Benefit, we want to prevent long-term users of financial assistance. To mitigate these situations, a dedicated team will manage the short- term relief programme and exercise due diligence in assessing applications, verifying evidence of proof and conduct ongoing monitoring of any changes in person's financial situation.

The Government views the introduction of this short-term relief programme as a stimulus to help individuals maintain their skills, their motivation and self-esteem positioning them for re-entry into the labour market and reaching a point of self- sustainability.