UG student submits COVID-19 impact report to Govt. - believes that up to $8B can be trimmed from budget

UG student submits COVID-19 impact report to Govt. – believes that up to $8B can be trimmed from budget

Apr 29, 2020 News

The Minister of Finance and the National COVID-19 Task Force have both received copies of a report from a 22-year-old University of Guyana student, outlining the impact of the pandemic and with recommendations made.

Matthew Gaul

According to former Youth Parliamentarian, Matthew Gaul, the effects of the pandemic in Guyana are being hard felt. His report would make recommendations for cash for persons hit by layoffs and for small businesses.
Gaul is a third-year University of Guyana (UG) student pursuing a Bachelors Degree in Finance.
He currently has an Associate Degree in Business Studies.
He was a guest on Kaieteur Radio’s Elections/COVID-19 Watch yesterday.
Urging that young persons should play a greater role in Guyana, Gaul said he did not believe that it is too early to have a fair assessment of the impact of COVID-19. In fact, in the short term, the impact is being felt.
From all indications, if the curfew continues, the hardships will extend in the coming months.
Gaul explained that he prepared his report from gleaning news articles, watching interview and analyzing the impact based on data from around the world.
He would have also examined reports of the Bank of Guyana and budget estimates.
One area he said is hit badly is tourism, with the airports closed more than a month now.
Initially hailed a breakthrough year for tourism, Gaul, who works at the Guyana Revenue Authority, said that the sector has been decimated, with little or no revenues expected.
Some 22,000 persons would be affected with the Guyana Tourism Authority projecting a 30 percent job loss.
In the services sector, some 40,000 would be affected. That sector contributes 50 percent of the Gross Domestic Product.
The fact that no stores, no wholesale and retail trade, private schools, barbers and hairdressers can operate because of restrictions will also have significant hardships.
The fishing sector, he said, is also badly hit, with US$97M earned in 2018.
In the report, Gaul said that he did posited that the country, because of a diversified economy will recover faster.
He pointed out that the rest of the Caribbean will not be so lucky because of their dependency on tourism. He acknowledged that oil, while not projected to bring as much windfall as expected, will still bring benefits and effectively allow for the crafting of the budget.
Gaul recommended cash in the short term for persons who have been terminated, but stressed that it would not be sustainable for this to continue.
The report recommended a one-off $200,000 for small business which are registered.
According to Gaul, it is a fact that there are significant businesses not registered. These should regularize if they want help. That expenditure for small businesses can cost the Treasury up to $2B. He also recommended between $1.5 and $2B for the Guyana Tourism Authority, for help to operators. The assistance would be on a case-by-case basis. The government can assess financial reports from the businesses to ensure that employees benefit.
Gaul listed the ‘vulnerables’ as persons with disabilities, pensioners and single parents, but pointed out that the base will expand rapidly in the weeks to come.
The assistance will have to be for about three months,
He recommended help for females, who will be more badly affected, of $50,000 for the next three months. The men, he said, can receive around $40,000 monthly.
Acknowledging that government is in deficit, Gaul said that there are a few ways to find the money, including working along with GRA and the NIS.
According to Gaul, one of the hardest hit groups would be the persons whose remittance would be cut off. He explained that millions are coming to Guyana annually from overseas for families.
One of the areas in the national budget that can be trimmed is that of food – about $5B annually is spent on food at the ministries and Parliament. Gaul believes that this can be reduced by 50 percent.
Another area would be $1.5B allocated for national events. This can be redirected.
Gaul estimates that about $8B can be re-prioritized by the Ministry of Finance to help to poor families.

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