Leader of the Opposition Arnhim Eustace. (File photo)

ST. VINCENT:- Leader of the Opposition Arnhim Eustace says the Dr Ralph Gonsalves administration cannot meet its financial obligations because of the “stupid budget” legislators passed in January and wastage of the country’s resources.

Eustace, an economist and former prime minister, said things are so bad in St. Vincent and the Grenadines (SVG) that telecommunications company LIME had begun to disconnect government telephones.

The bill for the telephone in his office, usually paid by the government, has not been paid for months, Eustace said.

He further said the government owed millions to the private sector even as it is unable to pay travel allowances to state employees.

Eustace said the country’s financial situation was “the worst it has been and it is going to take a lot of work to bring it back”. (Go to the homepage to subscribe to I Witness-News)

“The situation is very bad,” the former minister of finance told supporters of his New Democratic Party (NDP) in East Kingstown on Thursday, Oct  14,  while making a bid for a fourth consecutive term as their representative.

“The government just doesn’t have the money. They have spent the money on all sort of stupidness, including $4 million on the Yes Vote campaign. But, the same time, they are having trouble buying plaster or drips down at the hospital,” Eustace told party supporters.

He said when LIME starts disconnecting government telephones, “it tells you something, because those institutions don’t normally cut off government”.

“The amount owed to them has become overbearing, [really] overbearing and they can’t take it anymore. So, they’re exercising some pressure to get their money,” he further said.

Eustace said that last year, the government owed the private sector EC$29.7 million (US$11 million), adding, “It’s worse than that now; much worse, as a matter of fact.”

He said this would cause the private sector to retrench people, even as he said some businesses have cut their staff by 50 per cent.

“We are creating more problems here in St. Vincent and the Grenadines because of the mismanagement by Ralph Gonsalves of the Ministry of Finance and the business of this country.”

He said an NDP government would, as a priority, have to restore private sector confidence in government.

He said an NDP administration would also sell bonds to pay monies owed to public servant and to settle government accounts with the private sector. (Follow I Witness-News on Facebook)

“When the private sector gets back their money, they will then begin to look at their businesses in a different light,” Eustace said.

Lawmakers in this year approved an EC$913.5M (US$338.3M) budget for 2010, a 20 percent increase over last year’s figure.

The budget had a deficit of EC$108 (US$11 million).

Recurrent expenditure accounted for EC$610.17M (US$226M), an increase of EC$55M (US$20.4) or 9.9 percent more than 2009. Current expenditure for 2010 was predicted to be EC$523M (US$193.7M) and amortization EC$87M.

Capital expenditure for the 2010 fiscal year was estimated at EC$303.3M (US$112.3M) an increase of 53.7 percent or EC$106M (US$39.3M) over last year’s spending.