The Tourism Enhancement (Slush) Fund

Wednesday, May 18, 2011

If there is one good thing that can be said of the People's National Party (PNP), it is that they left the state-run Tourism Enhancement Fund (TEF) healthy — US$20 million of health.

Prime Minister Bruce Golding had better grab a hold of the fund before there is nothing left to carry out its mandate under the Tourism Enhancement Act of 2004.

More importantly, the Office of the Contractor General needs to train its microscope on the operation of the fund, not unlike the brave way in which it is watching the National Works Agency as it manages the Chinese-financed Jamaica Development Infrastructure Programme (JDIP).

The rumours rife in Montego Bay are that this critical pool of funds is in immediate danger of being transformed into a cesspool into which grimy hands have dipped and are again poised to dip. We have long heard the rumours and wanted to ignore them, but they persist... and persist.

Jamaican people are not fools, and they see the ostentatious lifestyles of prominent people associated with the TEF and they are asking questions. Unfortunately, there are more questions than answers.

One of the most troubling reports is that the desperate move to increase the TEF fee to US$10, as against the US$5 reluctantly accepted by the people in the tourist trade who know the danger of imposing more taxes on visitors, is motivated by the need to replenish the fund.

The TEF is financed by what is called a Tourism Enhancement Fee, which is charged to incoming airline and cruise ship passengers. For some strange reason, the airline passengers, who are by and large hotel guests, have to pay the fee, but there is hell to collect the US$2 fee from the cruise ship companies. It is the hotels, therefore, which bear the brunt of the fallout from this tax.

But this makes so little sense. Jamaica gets 91 per cent of its tourism earnings from land-based hotels; six per cent from cruise ships and two per cent from what is called bare boating (yachts).

Given the slippery slope which we must negotiate in these recessionary times, all the skilful folks in the other tourism markets are steering clear of additional taxes on visitors. What's wrong with our people?

It is also very shameful that some political types have been virulently bad-mouthing people who have expressed a view against the imposition of new taxes, at a time when the Golding administration is supposed to be moving away from punitive taxation. How will people take them seriously?

As a newspaper, we are well established in our support for the concept of the TEF and wish to see it continue to be healthy and vibrant. It is noteworthy that the Sandals chairman, who is also our chairman, has also agreed to a US$5 increase, knowing, that even at that it was risky, but just in the interest of the fund.

The TEF's lofty goals include: encouraging better management of environmental resources, enhancing the tourist experience within Jamaica, and facilitating the sustainable development of the tourism sector. Its vision is to see Jamaica become the most desirable tourist destination by upkeeping of well-designed and attractive resort towns.

Perhaps the best thing that could be done to protect the fund is for Prime Minister Golding to take it under his wings at Jamaica House. That way he could ensure that it does not become an embarrassment on the election campaign trail.

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The Tourism Enhancement (Slush) Fund