Published On: Tue, Nov 29th, 2022

Government spent millions, but effectiveness support programs remains unclear

PHILIPSBURG — The government paid out millions of guilders through its stimulus and relief program (SSRP) in 2021, but the Audit Chamber has been unable to establish whether this program was effective. ”During the investigation it became evident that it is difficult, if not impossible, to establish whether the SSRP was effective. Mass layoffs seem to have been prevented but we cannot substantiate this conclusion due to a lack of data,” the Chamber writes in the conclusion of its audit report. “The funds used to implement the program originate from the Netherlands but these loans will have to be repaid.”

The Chamber sent its report, entitled Efficiency Audit: Sint Maarten Stimulus and Relief Plan 2021 to the ministers of Finance and Public Health, Social Development and Labor (VSA) for comments but only the cabinet of the Finance ministry provided a timely reaction. “Submitting information to the Audit Chamber is a legal requirement,” the report states without further comment.

On the upside, the program-rules did a good job preventing overpayment to applicants. Currently, an amount of a bit more than 266,000 guilders ($148,603) is under review for possible repayment.

Aruba did much worse: it spent 271 million guilders ($151.4 million) on support programs and it will have to recover 73 million ($40.8 million) from parties that received too much. This is due to the fact that in St. Maarten payments were only approved after applicants submitted verification of their loss of turnover. In Aruba, that verification took place after the fact.

After the outbreak of the COVID-19 pandemic, the government established the SSRP as a program to provide emergency relief and economic stimulus, including direct assistance to vulnerable sectors and groups. SZV was charged with the execution of the payroll support program and to this end it received 103 million guilders ($57.5 million) from the government, SZV spent 97 million ($54.2 million) and repaid 5 of the remaining 6 million. The Sint Maarten Development Fund (SMDF) was charged with the execution of the unemployment support programs. It received 12.58 million guilders ($7 million) for it and spent 9.8 million ($5.5 million).

The audit notes that delays in payment occurred because businesses had to submit stamped tax forms. This resulted in a backlog in 2020 that continued to have an effect in 2021. Remarkably, there has been no investigation into the root causes of the delays.

Referring to the national budget, the Audit Chamber found that the government budgeted the following amounts in 2021: payroll support 89 million ($49.7 million), income support 4.88 million ($2.7 million), unemployment support 8.63 million ($4.8 million), SMMC-subsidy 10 million ($5.6 million) and food vouchers 0.75 million guilders (almost $419,000) for a total of 113.26 million ($63.2 million).

For income support there were 3,556 application in 2020 and 4,799 in 2021. In 2020, 3,110 applications were approved, in 2021, 4,516.

Unemployment support attracted 3,949 applications in 2020 (3,073 approved) and 5,122 in 2021 (3,997 approved). Successful applicants received 1,150 guilders ($642).

Looking at effectiveness, the audit report notes that unemployment doubled in 2020 and 2021 compared to 2019 but that the rate stayed stable at around 15 percent during the programs. “Effects on the labor market were noticeable, but the business community fared reasonable well,” the report states, adding that the number of new businesses exceeded the number of dissolved enterprises.

The number of appeals against negative decisions was limited. The number of applications totals 7,809 but in 2020 there were 120 appeals and in 2021 just 52; 81 appeals were approved and 91 were rejected.


Audit report: Efficiency Audit: Sint Maarten Stimulus and Relief Plan 2021