Latest update March 28th, 2024 12:59 AM
Feb 03, 2016 Editorial, Features / Columnists
Last Friday, the Finance Minister presented to the nation a $230 billion budget. Once again, the largest budget in the country’s history.
Government budgets are of three types: Balanced: when government revenue and expenditure are equal; Surplus: when anticipated revenues exceed expenditure; and Deficit: when expenditure is greater than revenues.
The 2016 budget outlines the administration’s anticipated revenues and expenditures; its two basic elements for the ensuing financial year. In the case of the government, revenues are derived primarily from sales, corporate and income taxes, and expenses include spending on goods and services, or consumption items; government investments on infrastructure, research; and transfer payments like unemployment or retirement benefits.
The budget speech is a statement on the economy but at the same time is also a political statement. The Minister of Finance, even in the worst of times, will try to paint the brightest picture possible about the state of the country. However, it is the role of the media to engage in a search for truth in the public interest, not to parrot what the Minister says as gospel. When all is said and done, the budget is nothing more than Government’s perspective on the current state of economy. And no matter what, the budget will be passed by Parliament and approved by the President.
In his budget speech, the Finance Minister dealt with the macroeconomy and the government’s attempt to put its financial house in order but, in doing so, sacrifices will have to be made by the average citizen. While it is good news that the government is trying to stabilize the economy, what ultimately will matter to the average Guyanese is what benefits they will reap from the budget.
Indeed, there are some successes at the macroeconomic level, but the Minister is banking on a three-and-a-half percent economic growth rate to stabilize the public finances and improve the foreign reserves. It may or may not be wishful thinking.
However, at the microeconomic level, which shows how individuals, households and firms are doing, the budget offers little hope of any short or long-term improvement to their trying circumstances. If anything, the budget has only added to their financial woes. There is no corporate tax relief for the private sector; no tax incentive for farmers; no pay increases for civil servants; no reduction of VAT, only a meagre $1200 per month increase for pensioners, and a $20 reduction on a litre of gas.
In the ensuing public debate in Parliament, the opposition will go to great lengths to offer various perspectives which may support or differ from what is proposed in the budget. If there is one thing for which budget debates are known, is disagreement between the government and the opposition. It is no secret that there will be charges hurled by the opposition against government members and charges laid by government members against the Opposition.
However, these charges and counter charges will serve only to foment further doubt and distrust among those whom they are elected to serve. The people yearn for an end to this adversarial political posturing.
Today, there is widespread cynicism about politics in Guyana. Generally speaking, the average Guyanese does not see politics or politicians as serving their interests, but as functioning primarily in their own interests, and doing little for the ordinary citizens, who believe they only matter at election time when their vote counts. Human beings tend, by nature, to take interest in what they perceive to be relevant to their needs. It is this perception that will present the Minister of Finance with his biggest challenge in trying to convince the public that the economy is improving and life will get better, as revealed in a bittersweet budget.
Maybe, when budget fanfare is over, both the government and the opposition can get back to the people’s business with a sense of positive purpose, informed by higher knowledge and values, and for worthier objectives.
THIS IDIOT TELLING GUYANA WE HAVE NO SAY IN THE 50% PROFIT SHARING AGREEMENT WE HAVE WITH EXXON.
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