KINGSTOWN, St. Vincent – Opposition Leader Arnhim Eustace said Monday Grenada’s inability to pay its public servants last week supports his position that this country budget should not have a deficit on the current account.
The New Democratic Party (NDP), which Eustace now leads, ran a surplus on its current account during its 17 years in office, a practice that the Dr. Ralph Gonsalves Unity Labour Party administration continued during its first three years after coming to office in 2001.
Eustace said on his weekly radio programme that the non de-bushing of this country’s roads one month into the hurricane season indicates a poor financial situation here.
“It is because you don’t have the funds in the current account to do it that you are having a lot of these problems. It is because of that why Grenada could not pay salaries a few days ago to it public servants,” he said.
He added that internationally, it is acceptable to have an overall deficit that is 3.5 per cent of GDP but not a current account deficit.
Eustace said that the more difficult a nation’s financial situation the more problematic it is to pay salaries, for the de-bushing and repair of roads, National Insurance Services contributions, transfers to the University of the West Indies and other state entities, and similar payments.
“… These things have to be met every month so they recur. They come up again and again every month. That is what the current budget is about. It has nothing to do with projects. It is about meeting the basic needs of people in terms of salaries, … debt, … to buy goods and services for the hospital and other things.
“Those are met out of the current budget and if you have a deficit on that it means that you can’t make them and therefore, it is a serious matter.
“Anyone who talks otherwise is talking foolishness. They must understand there is a big difference between the current budget and the overall budget,” Eustace said.
“That’s the current account of the budget. That’s the one we always say should be in surplus or at least it should be in balance,” he said.
“I have pointed out over and over again and I have heard person who are trying to get into political office making all kinds of foolish statements on the radio,” Eustace said.
“And that is why I have said for years that we must be prudent with our spending. These things about when you try to be prudent people say you are only calculating for the books, you are not looking after the poor and balancing the books, that’s a lot of foolishness coming from irresponsible people who don’t understand what you say when you don’t have a current account deficit. It’s ignorance and designed to fool the population.”
Eustace said that the economic problems in Greece would not have been had they exercised fiscal discipline over the years.
“[But] supposedly responsible people [in St. Vincent and the Grenadines are] telling you nothing is wrong with having a current account deficit.
“They don’t even know the difference between a current account deficit and an overall deficit. A lot of foolishness! And it harms our population. If you can’t build the road and you cant clean the roads you are harming our population and putting them in danger,” Eustace said.