What do the people prefer: US$5,000 per household or placing oil revenues in the hands of the government “to teach them how to fish?” The answer to that question is not difficult for anyone with even a faint understanding of Guyanese people.
The overwhelming majority of Guyanese would prefer the US$5000 in the pockets. Very few households are going to opt for free university education over a one million dollar cheque each year. That is how we roll here! Better with we than with the government!
Right now there are 205,000 plus households in Guyana. Once the government decides that they will pay one million dollars per household, the number of households is going to double, triple and quadruple overnight. One family will suddenly split into two or three households so that they can obtain more than one cheque. This is how we roll here!
The government is going to end up with a logistical nightmare. They will end up in deep problems in trying to enumerate the number of legitimate households. Husbands will begin to separate from their wives, just in order for two household cheques. This is how we roll here!
Of course, people are still looking forward to receiving a cheque, come next April. They are doing so even though it has been repeatedly pointed out to them that Guyana got the big shaft during the oil negotiations and that there is never going to be enough monies available within the first five years to pay any cash transfers. There may not ever be enough money at all! But in Guyana, people see the writing on the wall and hope for the best! This is how we roll here!
A financial analyst, Mr. Ramon Gaskin, was on Kaieteur Radio a few nights ago and put forward some alternatives to the cash-transfer. His projections of oil revenues may be a bit off but he did point to ways in which the revenues can be used.
He said that we should begin to cut away at our external debt which has now skyrocketed to US$1.4B. Nothing is wrong with debt. What can become burdensome is high servicing. With the US300M that will be available for the first few years, Guyana need not worry about trying to reduce the debt. Oil production alone is going to dramatically slash the debt to GDP ratio.
The second area identified is to boost the country’s external reserves. Given that there will be a surge in imports when oil production begins, the present level of reserves will become dangerously low and this is one suggestion which needs to be taken seriously.
Another suggestion is for tax reform. It was suggested that the VAT be phased out from 14% to 0%. But if this is done the government stands to lose in excess of US400M per year which is far more than what Guyana is likely to obtain in the first few years of oil production. Right now VAT receipts are about US$270M per year.
VAT has its benefits. It is the most efficient tax which exists on our law books. The problem is not VAT. We should keep VAT. The problem is the rate. A 5% VAT rate will not be bad. We can roll with that!
Another suggestion is to pay teachers, medical personnel and police better. This is long overdue. In fact, the first thing that the government should do, should be to give teachers 100% increases in salaries and do the same for medical personnel and do the same for the police. Forget about the pen-pushers in the rest of the public service and the army. They should be last on the list. We can roll with higher wages for teachers, medical personnel and the police!
Another useful suggestion is something better for pensioners. Improved health care and a bridge to Essequibo was also touted by Mr. Ramon Gaskin. We can roll with that here!
But even after all of that you will still find Guyanese people asking for a cheque in their mail each month. After all. Nothing rolls better than freeness in Guyana!
(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper)
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