Opposition Leader Godwin Friday says that the EC$1.6 billion Estimates of Revenue and Expenditure that Finance Minister Camillo Gonsalves is asking Parliament to approve for 2024 contains “lots of promises, no fulfilment”.
Responding to the numbers in Parliament today (Tuesday) Friday pointed to missing numbers in the document even in the finance ministry and questioned the seriousness with which its preparation was taken.
“That’s the overall context of the budget: lots of promises, no fulfilment; flouting the laws and regulations that the minister is required to follow, not even having the care and attention to prepare the document with the basic information that is required to inform us here in the Parliament, about how the various departments of the ministries are functioning; no attention to the overdraft problem with the lack of reconciliation between what the bank says and what the government says, adding up to … by now probably over $120-$130 million of money unaccounted for,” the opposition leader told Parliament as he responded to the package.
Friday said the government was still in the practice of converting to a permanent loan the overdraft, which is supposed to be cleared at the end of the year.
He said this is done despite the high interest rates of 6.5 or 7%.
“All of that is costing us money. The minister talked about the debt servicing that has gone up and the debt to GDP ratio is rising and so forth. All of these things add to them,” Friday said.
The opposition leader noted that in his opening remarks he applauded the workers in the Ministry of Finance and the people in the various ministries who help to produce the Estimates annually.
“It looks like a very tedious and boring exercise, but it’s vitally important,” the opposition leader said. “But sometimes you read the document and you wonder if they just run out of time or it just didn’t bother with some areas,” he further stated.
This “leads to a certain approach to reading this document and wondering how much fidelity there is in it to the truth, to what is required in terms of policy”.
He pointed that under inland revenue services, which comes under the Ministry of Finance, there are a number of key programme actions.
“And then there are output indicators below and not a single entry in any one of those columns,” Friday said.
He pointed out to Parliament that among the fields for which information was not entered were percentage of taxpayers filing by due date, the number of registered taxpayers — male and female; the number of cases heard by the court, and the number of objections received.
“There seems like there is no attempt to carry out the mandate of the minister. And when you see that you ask yourself, ‘Well, what else should I not take seriously in this document?’” the opposition leader said.
He noted that pensions “is something that’s on everybody’s lips now”, noting that the minister said he would give this particular attention when the budget is delivered in January.
However, under pension and retirement benefits, the Estimates contain no information regarding the project.
“There was nothing, no information, just a box and some headings,” Friday told Parliament. “How am I supposed to take that?’ he said.
‘a serious credibility gap’
The opposition leader pointed out that the situation was the same as regards the Centre for Enterprise Development, whose key programme actions for 2024 are listed, but there was no entry to date for 2023.
“… and that’s just in one ministry,” he said, adding that he had not had time to peruse the entire document with the same level of detail.
“But I know I have seen it elsewhere. The point that I’m making, comes back to the original assertion I make, which is that there is a serious credibility gap when it comes to the presentation of the estimates and the budget,” Friday said.
“We will come when we are debating the budget in January, hopefully. And you will see a lot of the stuff that is there, they just sound nice and presented with such confidence.
“And then you look at the end of the year and you say that ‘Where is that?’ And it’s as though the minister expects you to forget that it was ever mentioned; that we must have short memories. How seriously can we take him in that process?”
He said the “flowery language and the hyperbole” from the government will make people think that there is no basis for useful critique of the budget.
The opposition leader pointed out that the finance minister had noted that the Estimates is made up of current revenue of EC$810 million and current expenditure of EC$835 million including a current account deficit.
“But you can’t just gloss over the fact that there is a deficit and have glowing things to say about the plans and the wonderful things you’re going to accomplish for the economy in general, for young people in particular, without specifically saying how you’re going to finance the deficit on the current account, how you’re going to finance what ultimately on the capital side is a shortfall of revenue of $215 million.”
Friday said that the opposition has repeatedly said that the Estimates have to be a guide, not just for the government, but for the society at large.
“Business people, looking at the capital expenditures, looking at the various allocations here and there, who operate in certain areas, ought to be able to say, ‘Well, they plan to spend $20 million here. So therefore, maybe there is some business for me. I can do something to prepare myself for it’ or those persons who have seen that, over the course of time when the government starts its projects, that there are spin offs.
He, however, said that when there is a shortfall of EC$200 million, “then you know that there has to be some cut, somewhere because there’s no other place for your money to come from.
Friday was speaking about the Other Capital Receipts category, which he said “is just simply used as a balancing mechanism.
“But that presents the budget as though it is some sort of public relations exercise, rather than a serious document based on sound projections and on real expectation that the revenue that’s forecasts, the money that they’re going to collect that they would get,” the opposition leader said.
“The budget of $1.6 billion is premised upon, for its implementation, finding $215.8 million in other capital receipts. … And it may seem from one year to the other that it’s stating the obvious but the point is, it may be obvious, but it’s very important, it cannot be ignored.”
Friday said that all the other revenue streams have been accounted for, including loans — local and external loans, tax revenue and non-tax revenue.
“And we are led to believe that somehow that the government could raise an additional $215 million from domestic sources in order to implement this large budget,” Friday said.
He said opposition lawmakers have in the past done an historical analysis to show that in fact, those monies are never found, and that the shortfall is part of the budget process going forward.
“I know it is Christmas time but Santa Claus don’t have that kind of money either. So, we are back to square one again, where we have this, which is really ultimately a dishonest document, where they present a budget of $1.6 billion where they only have essentially 1.4 [billion]. They are $215 million short.”
‘ask yourself how to fix people’
He noted that the finance minister said that the Estimates will transform the lives of people in the country.
“They’re his words. He said that there were going to be major projects,” Friday said.
He noted that the minister said that the government will spend over EC$350 million on projects this year, more than any other year and EC$570 million is budgeted for 2024.
“… but again, it’s on projects. We need to focus on people. We have to start thinking about the lives of people that are affected,” Friday said.
“When you’re fixing a road, understand how it’s going to affect people who use that road. Don’t just do it because it’s convenient to you. When you’re budgeting for certain things, whether it’s in the fishing industry, in agriculture, you have to ask yourself how to fix people.
“Otherwise, big projects don’t mean nothing. All they do is just something for the minister or the government to brag about. ‘Watch how big it is. Watch how big and pretty this is.’ But if it doesn’t change lives, if it doesn’t make people, if it doesn’t provide for people, then it’s just a project and there have been many of those not just here, bigger than anything we’re doing here all over the world.”
The opposition leader said these projects look good “but they don’t do a damn thing for the people.
“The point that I’m saying, I support the capital projects that have been done because we need to jumpstart this economy, we need to get things going ahead. But you can’t do it in isolation, in a vacuum. You have to focus on people.
“And I’m looking forward when the budget is debated in January, that that must address those issues, the cost-of-living crisis that people are feeling, the problem with the pensions and so forth, the insecurity that people feel in their homes because of rising crime, it has to focus on people,” Friday told Parliament.