Whatever the economic statistics cited by the Minister of Finance suggest, Guyana is facing severe problems that are in need of urgent attention.
These problems include: socially dysfunctional levels of unemployment in spite of an unprecedented flight of Guyanese from these shores; simmering social and racial tensions; one of the highest rates of suicide in the world; an impending environmental and public health catastrophe associated with inability to dispose of our waste; a growing army of destitute and mentally-ill persons on our streets; along with hordes of unemployed, unskilled and hopeless youths.
The APNU continues to draw to the government’s attention the need to address these burning economic and social issues.
The PPP regime, sticks doggedly to the path followed by Bharrat Jagdeo, a path of denial, rampant corruption and abuse of office. The Budget Statement, of 25 March 2013, suggested that little has changed.
Political dialogue, which could inform the needed change and ensure an Opposition buy-in to policies, has been absent. Equal access, given such prominence in the Statement, is absent. The current furore, over the allocations for TV and radio frequencies, demonstrate the extent to which the Government is so contemptuous of public opinion, and its own constitutional obligations, that it presided over the award of frequencies and licences almost exclusively to PPP personnel and friends of Mr Bharrat Jagdeo. Elsewhere, the PPP is the only Parliamentary Party that has failed to provide the names of nominees for the Public Procurement Commission.
Presidential promises of political dialogue fill the airwaves, even as officials, charged with such dialogue on the Government side, refuse to provide information or to meet as promised. These shenanigans suggest that the Budget is no more than a conduit for inflexible and often discredited ideas.
The Minister’s budget statement opens with a provocative tirade against the Opposition Parties for various sins facilitated by the constitutional “majority of one”. Presumably, these include the correction of the constitutional abuses that the Government has perpetrated since 2003. It does appear that a majority is only acceptable to the President if it is a PPP majority. Democracy requires, however, primacy of a simple majority and makes no distinction between a majority of fifty or of one.
The Budget architects outline a programme for 2013 that is no different from those of 2006 to 2011.The main features of the regime’s economic programme are:
1. Give increasing priority to capital projects at the expense of current expenditure.
2. Choose capital projects on the basis of those which offer the most benefits to a privileged few, even if this means a higher cost to taxpayers when projects, such as the new Skeldon Factory, work poorly.
The main and most controversial capital projects continue to be the same as in 2012 and most do not actually appear in the Estimates although they are mentioned in the Budget Statement: Amaila Falls hydro and road construction project; Marriott Hotel Project; Speciality Hospital; and several supposedly LCDS projects. Every one of these projects has been mired in controversy about graft and inefficiency. The price the Nation will have to pay for these characteristics is already evident. There is the Skeldon Sugar factory, for example, where increasing numbers of PPP supporters are falling out of the labour force, as a result of very low wages and inefficient management.
The PPP strategy has two other elements:
1. The award of concessions to businesses linked to the PPP. This is the policy of cronyism and nepotism and the outcome is widespread discrimination, racism, graft and glaring inequalities. The most egregious of these has been the 2007 concessions to Queens Atlantic Investment Inc. (QAII).
2. The capital expenditure programme is to be used to pass funds to cronies and to benefit PPP constituencies. This is not efficient and largely benefits major contractors rather than the poor. There is little effort to ensure that expenditures are directed to or managed in a manner that favours labour intensive projects or are geared to addressing the local unemployment problem. The worst case of this kind is the Marriott Hotel project.
The preservation of macro-economic fundamentals sounds impressive when voiced by the Minister, but the non-transparent policy-making means that the public cannot be sure of exactly what figures underlie the 2013 Budget.
Revenues and expenditures of considerable magnitude fall outside of the Estimates laid before the National Assembly. The call for the funds from the Lotto and NICIL to be accounted for and brought within the Consolidated Fund continues to be ignored. Furthermore, for the last six years at least, the Auditor General has pointed out that the Minister of Finance (MOF) has routinely abused the Contingencies Fund. It is certain that the fiscal balance presented by the Minister is inaccurate, since the MOF has already spent or intends to spend more than stated.
On the basis of the revenues collected the Minister should have been committing more resources to investing in the Guyanese people and the improvement of their conditions. Instead of this, the Budget directs resources primarily to contractors and a few areas of business.
In 2012, the Opposition Parties called for a reduction of the VAT, the MOF refused and the President offered to set up a committee to review the entire tax structure. Neither the President nor the MOF have even deigned to mention whether the Committee has met as yet. A year has passed and they assume things in the meantime, the Minister boasts that VAT revenues increased by over 6% in 2012.
The overall improvement in revenue levels received and anticipated should have led to a credible programme of assistance for the needy and the vulnerable. When APNU called for a 2012 Old Age Pension of $15,000 per month, the Government promised that the increase from $8100 to $10000 in 2012 for pensioners would be an interim increase. However, such is the Government’s mean-spiritedness that, even in 2013, they are proposing $12,500, instead of the $15,000, from May 2013 instead of January. This seems to be a deliberate step to deny a constituency in which they have no political interest.
Not all pensioners will benefit from the water or the electricity subsidy, since most of them are not, by virtue of their circumstances, direct customers of GWI or GPL and, therefore, cannot benefit directly from the proposals. The same mean-spiritedness applies to the movement of the income tax threshold and rate. The 31/3 % reduction that some wage earners will receive is to be taken away by the announced increase in NIS rates. In the same vein, the mortgage interest relief, which will benefit those borrowing to build houses valued up to $30 million, goes no way to meet the need of the poor who are not in a position to obtain mortgages in any case.
Among the budget measures the Minister announced are the transfer of $11.2mn to GPL and $1.7mn to GuySuCo. The problems be-devilling GuySuCo have been obvious for quite a while and the Opposition Parties, as well as GAWU, have been calling on the Government to take measures, of an operational and policy nature, to address the problems of the industry. These calls have been ignored. Now the Minister is promising a 2013-2015 Plan, to facilitate a dramatic reduction in the needs of the industry.
Doubtless, as was the case in 2013, the MOF will turn up in May 2013 to ask for an additional $6mn.
Budget 2013 is a mean-spirited budget in which much of what is offered will not be available to all those who might be expecting it and much of what can be received will be taken away by other Budget measures such as the NIS increase.
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