A growth oriented budget

Feb 17, 2021 Letters

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DEAR EDITOR,

Kaieteur News – It was an impressive growth oriented 2021-2 budget unveiled by the Finance Minister last Friday. It has been a long time since I studied or taught economics or analysed a budget. So I am a bit rusty on economic concepts. Nevertheless, I still remember some basics to know that the Finance Minister and the Vice President teamed up to produce a very good budget.
A National Budget is a tool to enable government to achieve its development agenda and political manifesto. It is approved government plans, programmes, and projects for a fiscal year. It consists of government’s estimated income and planned expenditures. The Finance Minister did a thorough job offering a very good framework for growth during COVID. As expected, the budget will meet with criticism from the political opposition, as it should because that is its role although credit should be given to the Finance Minister for the new and creative and innovative aspects of the budget. There are several aspects of the budget that can be critiqued especially with regards to rural and hinterland spending and the farming sector. But I leave that for the opposition. Public servants should not be kept in the dark and the Vice President said money has been set aside for salary increase. But public sector incentives must be commensurate with productivity. There should be government foisted salary increase not only for the public sector but the private sector as well. You don’t want a situation where government employment is more attractive than private sector, causing people to leave the private sector for government employment.
In a time of unprecedented economic stress, the government’s responsibility is to spend enough money to revive the economy to ease enormous human suffering without triggering inflation or unaffordable deficits. Uncertain times call for high responsible, government spending. And the government has not disappointed.
The Finance Minister, Dr. Ashni Singh, and Vice President Jagdeo are to be applauded for a well-rounded budget that is expected to revive the struggling economy after five years of disastrous economic policies of the preceding government. The economy was worsened by the Corona disease but the preceding government made virtually no meaningful effort to mitigate the effects of Corona on the public. This is the first full budget of this government and of this new decade. The Singh-Jagdeo duo has done a fine job in planning a budget that is geared at reviving the growth impulses in the economy. It gives the public an opportunity to re-imagine the kind of economy that will be developed in years to come and offers hope to the population that the country has a bright future ahead.
Coming in the backdrop of a global pandemic of the century, the government boldly spells the government’s growth agenda and a march towards building a prosperous country. It is visionary, path breaking, inclusive, and growth-oriented. It is all rounded, with no sector neglected, that should foster growth in all productive sectors of the economy. Every sector has received an increase in funding.
Despite the devastating impact of the COVID-19 pandemic on the economy, Budget 2021-22 has not levied any new tax on the people. Instead, it has reduced taxes. It relies on non-tax resources but a high deficit which is manageable. Once the economy grows, the government can eradicate the debt. It has not burdened any section of the country with new or increased taxes. There is a significant increase for health, education, and capital expenditure to boost the economy that, aside from mining and rice production, contracted significantly, last year and in the preceding years. Health seems to be the top sector in the budget. The budget for health will help us to tackle the Corona by providing vaccine for all. There is also an increase in budgeting for education, agriculture, infrastructure, housing, security, social services, public administration, labour, in fact, for all sectors of the economy.
It is a budget with a difference from the preceding five years. The PPP administration seems to consistently focus on responsible spending, not profligacy. This as well as the budget of last September has erased tens of billions of dollars in debts of the predecessor regime. This budget will infuse new energy during the time of corona. It should provide impetus for growth of the economy. It should help to revive the ailing economy and take the country on a path of development with job creation.
What I would have liked is to see additional budgeting for some kind of mechanism (perhaps an expansion of monitoring by the Auditor General Office) for greater transparency on all government expenditure. Government agencies and Ministries should deliver reports on a timely manner on their performance, perhaps on a quarterly basis, so that the public can be kept abreast and monitor them. People can better hold the government accountable.

Yours truly,
Dr. Vishnu Bisram

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