Budget 2023 was crafted in La La Land

Jan 18, 2023 Features / Columnists, Peeping Tom

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Kaieteur News – The main Opposition parties, the PNC/R and the AFC, are expected to oppose the Budget. The role of the Opposition is to oppose, criticize and offer alternatives.

And so regardless of how good or bad a Budget is, the Opposition can be expected to be critical of it, as it has done in its preliminary reaction to the 2023 Budget.

However, this time around, Mr. Aubrey Norton has justifiably identified some of the fundamental flaws in this year’s Budget. And he is spot on with most of his criticisms.

He has said, for example, that the Budget does not address the issue of inflation and the rising cost of living, noting correctly that if you are pumping money into the economy without measures to curtail inflation, prices will go up further.

The Government has pointed to a suite of measures it implemented to curb inflation. These measures include handouts to parents and pensioners and reducing to zero the excise taxes on petrol.

But these measures were unable to prevent inflation skyrocketing to 7.2% in 2022. The Government offered Public Servants a mere 7.2 increase in wages, meaning that in real terms, wages increased by less than 1%.

One can hardly disagree with Norton that the Budget does not address the rising cost of living which is the main problem facing the Guyanese people today. While inflation is a global problem, the sort of squander mania which the PPPC engaged in during the past year has added to the rising cost of living.

The PPPC’s response is that it sets aside monies in the Budget to address this issue. But this only exposes its intellectual bankruptcy since it should have been able to announce measures to address the cost of living rather than allocating a block sum for cost of living relief.

The PPPC appears to have prepared this Budget in La La land because it does not address any of the fundamental concerns of the citizenry. Norton has said that the Budget has been found wanting when it comes to measures to attenuate, alleviate and eventually eradicate poverty.

A Reporter questioned the President about this criticism and the President opted to engage in theatrics rather than seriously debunk the criticism. He spoke about the distribution of house lots and the increases in old age pensions and social assistance.

Poor people cannot afford the price of even low income house lots and the increases in old age pensions and social assistance are an insult to the recipients. It is better they had taken the increased allocation for the $10,000 increases in the “Because We Care” cash grant and given it to the pensioners and social assistance recipients. This would have added a further $30,000 per month to old age pensions.

The PPPC has no poverty reduction plan. It has no proper plan to address the cost of living. The President speaks about 25,000 persons being given house lots but what he does not say is that the majority of the poor cannot afford to build a house because of the skyrocketing price of construction materials, a development which is being contributed to by the fact that Government’s road construction programme has led to an increase in the price of cement and sand and  an acute shortage of stone.

The Private Sector in typical reflexive action has welcomed the Budget. But the Government part-time jobs programme has been a nightmare for the private sector. It has led to a shortage in labour. The Private Sector is feeling the squeeze because it is experiencing problems in finding workers and those who are available are increasing the amount they want to work for.  The Government’s infrastructure programme and the sugar industry is also being affected by the part-time jobs programme.

But the problems of the Private Sector are only now beginning. The Government says that it plans to expand the programme which will now not only make it impossible for the Private Sector to secure workers and will likely see an exodus of low income workers from the Private Sector..

The part-time jobs programme does not address a fundamental problem in the economy and the need for full-time employment opportunities. Part-times jobs reveal a fault line in the management of an economy.

And to compound the agonies faced by Guyanese, the President, in answer to a question by a Reporter, said the Budget will not lead to Dutch Disease since what is important is how the oil revenues are spent. Judging from squander mania which the PPPC is engaged in at the moment, Guyanese have more to worry about that the miniaturization of the non-oil sector in growth. They now have to worry about the oil revenue being squandered by a Government that fails to address economic fundamentals.

(The views expressed in this article are those of the author and do not necessarily reflect the opinions and beliefs of this newspaper and its affiliates.)

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• “Because We Care”, La La Land, Mr. Aubrey Norton, Peeping Tom, PNC/R

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