PPP Parliamentarian protests early budget

Dec 08, 2017 News

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While early budgets may have its advantages, it brings as well, a fair share of worrying legal and financial complications.
Expounding on this conundrum on Wednesday in the National Assembly was Opposition Chief Whip, Gail Teixeira.
The seasoned politician noted that she raised this very issue during the debate on budget 2017.
Teixeira explained that when the Opposition sought to examine the 2017 budget and its estimates, it was faced with a fundamental issue; it couldn’t figure out when was the cutoff date for the figures that were presented by the Minister of Finance.
Teixeira pointed out that the 2017 budget, which was presented in December 2016, contained figures about spending that could easily be considered “guess-timates” since the year was not finished.
She said that in the discussion of the 2018 budget, the Opposition is faced with the same issue and is therefore at a tremendous disadvantage.
The Opposition Chief Whip said, “The figures (in the budget/estimates) are projections and not based on fact because the year is not finished. The figures have not been accumulated and analyzed and we have great discomfort in dealing with figures which may be wrong by the time you get to the end of the year.”
She contended, too, that the situation also births a legal issue since the law states that the books for agencies and ministries close on December 31. In this regard, Teixeira said that if the government wishes to close the books on an earlier date it has to amend the law.
The Opposition Chief Whip said, “When you have a budget in January after the cutoff date, you then have a more accurate representation of the performance of the economy, and the government. But this is not the case.
The budget is being brought to the House before the start of the fiscal year and before the date to close the books as stated in the law…”
She added, “So you are asking us to debate figures which are flawed and which may not be correct by the time we head into January of the following year. If they want early budgets, amend the law so the cut off dates are known and the budget presents a true reflection of what was expended and not “guess-timates.”

PSIP
Additionally, Finance Minister Winston Jordan said to the House last year that the reason for early budgets was so they can have a full 12 months to implement it. Teixeira noted however, that when one examines the poor implementation rate of the Public Sector Investment Programme (PSIP), Jordan’s argument falls flat on its face.

The rate of implementation of projects was also highlighted in the half year report of the Ministry of Finance.
According to the Ministry, the Public Sector Investment Programme, which is financed by both local and foreign funded sources, expended $15.8 billion during the first half of 2017, reflecting a 19.8 percent increase over the first half of 2016.
Finance Ministry officials said however, that this represents only 27.9 percent of the PSIP’s budgeted allocation of $56.8 billion.
It was noted that the locally-funded projects were primarily constrained by delays in the project implementation as a result of a dearth of procurement planning, apparent lack of capacity, and delays in the tender process.
The Ministry noted that this resulted in only 26.8 percent of the budgetary allocation of $34.6 billion expended at half year. The implementation of the foreign-funded projects was also plagued by delays emanating from the late finalization of a number of financing agreements with both multilateral and bilateral development partners, and the subsequent setting up of the project implementation unit.
As such, the Finance Ministry noted that a mere 29.6 percent of the budgeted sum of $22.1 billion of the foreign-funded portfolio was expended. In the first half of 2017, the amounts expended for major projects including the Cheddi Jagan International Airport (CJIA) Expansion Project, the Power Utility Upgrading Programme, and the West Coast Demerara Highway Project, were $2.8 billion, $1.2 billion, $0.6 billion, respectively.
In spite of these constraints, Government said that it remains committed to delivering the budgeted PSIP and has taken steps towards the improvement of the pace of implementation.
These include increased monitoring, the introduction of a Cabinet level reporting mechanism in June 2017, and training Ministry officials from key sectors in procurement planning.
Further, in an effort to attract more persons to the national pool of evaluators a stipend of $3,000 per session was approved by Cabinet, for each evaluator. In addition, monthly stipends were introduced for members of the Ministerial, Regional, Departmental, and Agency Tender Boards.
At the end of June 30, 2017, there were a number of ministries which were below the 30 percent margin regarding their rate of implementation. The Ministry of Social Protection, for example, had a budgetary allocation of $477M but up to last June, it had only used up $81M. This represents an execution rate of 17 percent.

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