THE MAJOR PROMISES HAVE NOT BEEN FULFILLED

Aug 23, 2015 Features / Columnists, Peeping Tom

---

The hundred-day plan by APNU+AFC had a number of promises. There were, however, four main promises that mattered; the rest were trivial and did not represent any major policy shift.

The first of the four main promises was the phased reduction of VAT and its removal on a number of food items. The government has removed VAT on some food items, but it has not delivered on its promise to have a phased reduction of VAT within one hundred days.

When APNU and the AFC were in opposition and held a combined majority in the National Assembly, they entered into negotiations with the then ruling PPPC to work on the Budget. They pressed for a reduction in the rate of VAT which was then, and now is, 16%. The PPPC countered by asking APNU and the AFC to produce a list of items on which VAT should be zero-rated. APNU and the AFC balked at the proposal and insisted on a reduction of the rate of VAT.

It was therefore something of a surprise that now that it holds the reins of power, the AFC and APNU should be doing the very thing that they had objected to under the PPP. They have produced a list of items on which to zero-rate the VAT, but they have not implemented the phased reduction of the VAT as promised within one hundred days.

The list of zero-rated items is controversial. The government has just settled a multi-billion-dollar judgment delivered by the Caribbean Court of Justice over the discriminatory application of the environmental tax under the PPPC. Yet it goes and does the very same thing with the VAT.

The new list of zero-rated items will see certain locally produced items benefit, while the same items produced overseas will attract VAT. This will lead to another legal challenge and to another judgment or series of judgments against the government. The new government is making the same mistake that the PPP made and saddling the country with the threat of litigation.

The real promise that consumers were interested in was the phased reduction of the VAT. This has not materialized and this is a major disappointment. The VAT remains oppressive and the public will be displeased that the rate of 16% still exists when it should have been reduced.

The second major promise made by the coalition was the reduction in the Berbice River Bridge toll. The tolls were seen as far too high. The AFC had gone as far as promising to nationalize the bridge, if this is necessary, in order to bring the tolls down.

Nationalization was not necessary. But the tolls have only been reduced by $300. This is pitiful. Most commuters were hoping that the new toll would have been around $300, rather than the reduction that is now effected. To add injury to insult, we are told that taxpayers have to subsidize this pitiful reduction.

So someone goes on a joy ride to and from Berbice and taxpayers have to fund the $300 reduction in the bridge toll. This is a disappointment and it would have been better if the government had not bothered to press for a reduction in the tolls than to have that reduction paid for by taxpayers. This is no reduction. This is a case whereby taxpayers are subsidizing the Bridge Company.

The third major promise was the establishment of the Public Procurement Commission. The government has passed the requisite legislation, but is unable to bring the Commission into being because it needs the support of the opposition to do so. This is not going to happen, because the PPP views the powers granted to the Commission, under the new law, as being greater than that granted by the Constitution. The PPPC therefore will view the legislation as unconstitutional and will not get involved in appointing the Commission.

APNU+AFC had to know when it made this promise as part of its 100-day plan that the PPPC would never support the Commission if it went ahead and passed the law. Yet quite arrogantly APNU +AFC went ahead and did this. There will be no Public Procurement Commission, and it will be business as usual in terms of oversight of the procurement process.

The next major promise and the most important promise was the offering of “significant” increases in wages. This has not happened. It has not happened because there is supposed to be some Commission of Inquiry to be appointed into benefits paid to workers. It would be premature for the government to have gone ahead and paid significant wage increases while this Commission was undertaking its work.

But did APNU+AFC not know this when it was making its promises? It should have known this.

On the four major issues of its 100-day plan, APNU+AFC has failed to deliver. Let us hope this is not a sign of things to come!

 

---

---