2018 Budget disastrous, abysmal failure
after Finance Minister Winston Jordan delivered a near fourhour Budget 2018 presentation, Opposition Leader Bharrat Jagdeo shredded the coalition Government’s fiscal plan for the next year, saying that it was without a doubt one of the most “disastrous” budgets ever presented to the nation.
Speaking to reporters from the Committee Room at the Parliament Building on Monday evening, the former President noted that the Budget, which was themed “The journey to the good life continues”, failed on every standard, especially as it related to addressing key matters of concern to the public.
“He has failed on every one of those parameters. Issues surrounding jobs, welfare, framework for growth and development, clarity of the Government’s vision in different areas, big-picture issues on where the country is going – we had hoped that all of these would be part of the budget presentation… they have lived up to the low expectations people had of the Government,” the Opposition Leader stated.
According to Jagdeo, the Finance Minister merely took the routine work programmes from the various ministries and read those inconsequential details out to the nation, while failing to address key manifesto promises such as job creation. “This sort of things is not what it takes to inspire a country to produce, to expand welfare, to generate jobs and so, on all those counts we have seen an utter abysmal failure on the part of the Minister of Finance and the Government,” he stated.
According to Jagdeo, the biggest job creation initiative is GO-Invest expecting to bring in $154 billion in new investments next year. However, this, he said, is nothing but fictitious, since similar claims were made before when Government touted $180 billion in investments were expected to be facilitated by GO-Invest and create 10,000 jobs.
“They lied then and it is now true now. That’s about US$750 million ($154 billion) of investments and they haven’t said in what sector. Even with the oil and gas sector, they can’t meet US$750 million in investments next year so that’s fictitious and it’s likely that the 5000 jobs that they are projecting to create next year is also fictitious,” he argued. Moreover, Jagdeo said that calling the measures outlined by the coalition Government “pathetic” would be a mild description.
“There is nothing here that inspires; nothing that says to the Private Sector “we’re working as your partner”…there is nothing to say to any group of Guyanese, whether you’re a young person, whether you’re a pensioner, you’re a child going to school, whether you’re a farmer, a bauxite worker or anyone working in retail, trade or a servant that (you) have a better year to look forward to, based on this Budget. There is nothing to look forward to!” says the former President.
Examining the financial performance of the country’s economy, the Opposition Leader posited that the growth rate could not have matched the revised projection of 3.1 per cent despite Government collecting some 8.7 per cent more in total revenues through taxes and other means than last year. This, Jagdeo noted, confirms what the Opposition has been saying all along, that the economy is not performing. “They collected $8.2 billion dollars more taxes in 2017 than in 2016. We’ve been saying that this government is taking more taxes out of peoples’ pocket while arguing that they were too heavily taxed under the PPP,” he said.
In addition to $10 billion being transferred from stat- utory agencies into the treasury, Jagdeo highlighted that there was a massive deterioration in the current account of the balance of payments of over US$ 200 million, while the marginal increase in the capital account is as a result of the inflows from ExxonMobil investments and disbursement. He added that the country’s debt has gone up and was projected to keep going up.
The Opposition Leader went on to say that the announcement of plans to carry out a countrywide land valuation to increase rates and taxes was a contradiction of the Minister saying that there were no new taxes in the budget. “They are introducing a measure now that, having exhausted the taxes measures at the national level, they are now taking this to the NDCs (Neighbourhood Democratic Councils) and municipalities across the country,” he stated.
Jagdeo also reflected on the Minister’s statements about the sugar industry, that the Special Purpose Unit ( SPU) would guide the divestment of sugar and also reconfigure the remaining estates. Referring to the Guyana Sugar Corporation ( GuySuCo) being termed an “old antiquated industry” that needs to be gotten rid of, Jagdeo said that had the PPP/C Government taken that approach regarding the bauxite industry when it took office in 1992, then bauxite production in Linden would not have continued. “We created alternatives for the people and still bauxite mines open in Linden and then we manage to privatise it. But this is their approach, an industry that about 100,000 of our people depend on, that’s already wreaking havoc on your balance of payments; now we’re seeing how impactful the sector is on everything else and this is your approach to it – short-sighted,” he asserted.
With regard to the rice sector, the Opposition Leader pointed out that it was the only industry that was sustaining the economy’s growth rate and would be driving the grow rate in the future without any help from Government, except the fact that work is being done to upgrade the grains.
Touching on Government’s popularly touted ‘Green State Development Strategy’ (GSDS), Jagdeo said that the coalition’s approach towards the energy pillar of the plan was one that was in contradiction of the overall objective of the strategy, which is the sustainable use of energy in a green economy.
He referred to Jordan’s announcement of entirely scrapping the Amaila Falls Hydro Project and moving ahead with the Moco Moco Hydro Project. According to the Opposition Leader, the latter would only supply Lethem with half a megawatt of power while 50 megawatts of power will be generated from natural gas. “That would violate the objective of this (GSDS) plan, which is to have a 100 per cent of our energy come from renewable sources by 2025. And he sees nothing wrong with it,” Jagdeo asserted.
He went on to outline that other energy projects such as the solar farm at Mabaruma along with others are being done without any transparency.
This led the former Head of State to further highlight that Government failed to address key issues in the emerging oil sector such as the release of the oil contract in the name of transparency.
“Frankly speaking, the worst period in modern history in terms of transparency and the use of public funds is now,” he stated as he listed several projects that Government was yet to fully come clean with the details on such as the new Demerara River crossing and the D’Urban Park.
Moreover, while Minister Jordan lectured on the oil industry and how to spend impending resources wisely, at the same time Jagdeo said there was a deliberate act on the part of Government to delay the establishment of the Sovereign Wealth Fund.
“This was a promise made two and a half years ago to get it done, but this is basically a delaying tactic. I think they do not want the Sovereign Wealth Fund in place because the Sovereign Wealth Fund will restrict
their ability to waste and to use the resources wantonly and in a manner they’re using public resources now,” he stated.
According to the Opposition Leader, a platitude approach was taken on other major issues of national importance such as constitution reform, debt management, Local Government Elections and the international Sustainable Development Goals.
He went on to reiterate that the coalition Government continues to piggyback on old projects started under the People’s Progressive Party/Civic (PPP/C) regime that are now coming to fruition.
In fact, this is exactly the case in the infrastructure sector, Jagdeo said, noting that most of the road projects were initiated by the previous Administration. He specifically mentioned the Cheddi Jagan International Airport (CJIA) Expansion Project, which the Opposition Leader said has turned into tragedy with the alterations to the original design. “This country needs an airport that will look to future; it is unbelievable that you would just reduce the air bridges to two from eight when we have aircraft on the tarmac waiting (to disembark passengers)… They just reformulated the project and now we’re gonna have an airport that we will have to go back to (in the future to again expand),” he posited.(Guyana Times)