Budget 2012

Apr 02, 2012 Editorial

It is perhaps not surprising that the budget did not contain any major surprises. President Ramotar did promise during the elections campaign that he would basically continue with the economic policies of the past administration.
But there was still some hope that the President would at least begin to break some new ground and give the populace a signal of a change in the status quo.
There is nothing wrong in the Minister of Finance, for instance, extolling the achievement of the past administration in maintaining economic growth averaging some 4.4% over the last five years.
This is a matter of the record and it is also true, as indicated, this achievement goes against the grain of the wider regional downturn. But we have to point out that countries such as Trinidad & Tobago and Barbados have achieved a much higher per capita income (PPI) than us.
Our status quo demands a much higher rate of growth than that achieved at present and projected – for us to get there. According to the World Bank, our annual PPI – measured as what it would take someone to purchase comparable goods in the US – is US$3450; while T&T’s PPI is US$ 24, 040. At a 4.4% growth rate it will take us 45 years to catch up with T&T – assuming that T&T stagnates and doesn’t grow. We will not even double our PPI at the present rate in 16 years. This means that we have to begin to do some things a bit differently.
We have emphasised that one of the questions that must be asked when the government spends money in a country as poor as ours, is “who benefits?” Both the President and his Minister of Finance emphasised that it was a “people’s budget”.
In a free-enterprise economy like Guyana’s, we understand that ultimately, the economic condition of all the people – especially the poor – will improve when they have jobs. Well paying jobs that can deliver a life of dignity for all. Therefore, unlike some, we will not reject out of turn initiatives that may flow to the private sector.
However, we expect a “people’s budget” to incorporate measures that will ensure that jobs will be created and that for contracts on services especially, value is received for money spent.
From this perspective, we expected that, for instance, funds would have been budgeted for an anti-corruption unit that had the powers to independently initiate investigation of corruption once certain enumerated benchmarks were triggered.
We are very skeptical of the efficacy of ‘good intentions’ – stated or otherwise – in and of itself to eradicate corruption. This disease, we all know, arises out of the very nature of man to be greedy and covetous.
We acknowledge the progressive nature of measures to raise the income tax threshold from $40,000 to $50,000. While we heard that the $6 billion subsidy to GPL will stave off an imminent rate increase in electricity, this will benefit the larger users more that the smaller, poorer ones. This is regressive. Additionally, such a subsidy hides the very real crisis in the management of GPL.
The latter constantly complain of ‘line losses’ – primarily from theft of electricity – but what they do not report is that the present exorbitant rate makes “Peter pay for Paul”. The subsidy is actually for management mistakes (or corruption) that had them rent standby generators at prices almost for what they might have purchased them.
Another budget policy that this newspaper has long railed against, which actually takes money from the poor and puts it into the pocket of the super rich, is the coddling of banks in this country.
Under the guise of keeping inflation in check, the banks are allowed to plunk their money down at the Bank of Guyana and earn billions of dollars in interest. This interest is paid from the taxes of all – including the poor – via the budget. Unless for this escape hatch, the banks would have been forced to lend to businesses to set up or expand businesses and provide jobs.
(To be continued)

Latest News

Budget 2012

Related

Similar Articles

The Glenn Lall Show|| March, 28th, 2025

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

Milo/Massy U18 Football heats up with Round III action

BCB bowls off U19 Inter-club Competition today

Nedd, Thorne recalled ahead of final rounds

Mice and Jermaine $1.7M Linden Futsal tournament...

Slingerz FC hunt second win tonight

More sponsors on board ahead of Second Annual...

Features/Columnists

Is the time saved worth the risk?

The Caribbean: Destined to Grin and Bear the Consequences of Its Self-Created Vulnerabilities?

Who are the thugs and hooligans now (Part I)

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]

Budget 2012

Share this:

Related

Similar Articles

The Glenn Lall Show|| March, 28th, 2025

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

Features/Columnists

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]