Chris Bryant, a British foreign office minister, said the suspension could last up to two years with Gordon Wetherell, the governor appointed by the United Kingdom, in charge.
“After careful consideration, I have instructed the governor to bring into force today an Order in Council which will suspend ministerial government and the House of Assembly for a period of up to two years, to allow the governor to put the islands’ affairs back in good order,” Bryant said in a statement.
‘Amorality and incompetence’
Britain began investigating alleged corruption last year and found “clear signs of political amorality and general administrative incompetence” on the islands, which are striving to become a leading offshore financial centre.
The deposed prime minister said the governor as well as the local government must share the blame for any systemic problems and stressed that London and local authorities could have worked together to resolve such problems.
“I believe most people in the Turks and Caicos will join me in welcoming these changes”
“We have a British governor who is responsible for good governance; who is responsible for civil servants, who is the president of the cabinet,” Williams said.
Governor Wetherell said the move did not amount to a “British takeover”.
“Public services will continue to be run by people of the Turks and Caicos islands, as indeed they should be,” he said.
“I believe most people in the Turks and Caicos will join me in welcoming these changes.”
Wetherell said he and the British government were committed to working towards holding free and fair elections by July 2011.
“We have much to do and public expectations are high… People need to feel safe from crime and we need to clean up public life and start to develop a fairer, more open society,” he said.
Allegations of corruption in land sales, distribution of government contracts, the granting of voting rights and misuse of public funds led to the launch of an inquiry in July 2008.
In March, Michael Misick, then Turks and Caicos prime minister, resigned after the investigation pointed to a “high probability of systemic corruption or other serious dishonesty” among the ruling elite.
Chris Jarrett, director of the government-run Radio Turks and Caicos, told Al Jazeera that there were mixed reactions to the British move.
“I think it may have been something everyone was expecting for the last two months or so, in lieu of how the proceedings are going on between the government, the former premier and the governor.
“We have a daytime talk where some people calling in were quite saddened that this was taking place, saying it is like setting the wheel back in time, whereas there were others who were happy.
“In terms of everyday operations, business seems to go on as usual.”
The Turks and Caicos islands have become an offshore financial centre thanks to a favourable regulatory regime and no taxation other than stamp duty and import duties.
A financial regulator in the territory said the suspension of the government would not affect the operation of its offshore finance sector, which has about 16,000 companies
registered, including many specialising in warranty insurance.
“There is no change in the status of the regulatory body or in the day-to-day running of the finance sector,” Kevin Higgins, managing director of the Turks and Caicos Finance Services Commission, told Reuters news agency.
He said the Turks and Caicos offshore finance sector had “not been in any way tarnished” by the corruption inquiry, saying this had focused more on tourism and real estate activities.
Once a dependency of Jamaica, the islands became a separate British crown colony when Jamaica gained independence in 1962.