05.DEC.08

Prime Minister, Hon. Dr. Ralph Gonsalves, on Monday of this week made his 2009 Budget presentation in the House of Assembly. It followed last week’s laying of the Estimates in Parliament which provided for government expenditure of $750,904,091. Significantly, this is a slight decrease (in absolute terms, larger in real terms) than the total budgeted expenditure for 2008, in the sum of just over $6 million.{{more}} The expenditure is to be funded by current receipts of $484.5 million, an increase of over $36 million and capital receipts of $266.3 million, down from the $309.5 million budgeted for the 2008 fiscal year.

In our editorial of last week, SEARCHLIGHT had opined that the 2009 Budget would be the most difficult in the life of the current administration. This was confirmed by the Prime Minister/Minister of Finance in his Budget presentation. Not surprising, given the circumstances we outlined in that Editorial, and which were forcefully underlined in the Prime Minister’s address. It is not the first time that this has happened in St. Vincent and the Grenadines, but it must serve as a clarion call to one and all of the extremely challenging situation facing us as a people and a nation.

Given the circumstances, the Minister of Finance did well, and except for the excise tax on imported soft drinks, no new taxes have been imposed, rather, income and company taxes continue to move downwards as promised. The stimulus package to businesses as well as continued support to the disadvantaged among us are welcomed, especially in these trying times.

When all the Parliamentary and media rhetoric dies down, Christmas passes and the New Year begins, the Big Issue will be how to ensure implementation of the Budget provisions. It has been our experience several times in the past that there is often a gap between figures and reality. Some Budgetary provisions take quite a while to kick into operation for one reason or another, thus the implementation phase is crucial, especially in precarious circumstances. Service provision by the bureaucracy is, therefore, key to budget delivery.

In this regard, relations between the Government, as employer, and its employees will have much bearing on budget delivery. The Budget address itself pointed to the need for boosting production and service delivery to stimulate the economy and thus provide the means for economic advancement. Both the private sector and government have well-enunciated complaints of each other’s shortcomings in seeking to achieve this goal. Deepening co-operation between them is essential if the tasks set out in the Budget are to be achieved.

At the same time, the rest of the population needs to have both a greater sense of awareness and understanding of the formidable obstacles in our path to socio-economic development. For instance, there is the alarming growth of our national debt ($1.06 billion) requiring expenditure of over $71 million for its service. Then there is the reduction in grant funding (from $116 million to $72 million) necessitating further borrowing to fund development projects. These cannot be sustained on the basis of low productivity, poor attitudes to work and public services, lack of regard for public property and the environment or on wanton consumerism.

If anything, a major national task, not just for the Government, but for the media and civic organizations, is one of getting our people to understand the realities of our situations and to shape new, more positive attitudes to production, productivity and national service. Now, more than ever, we need to forge that national consensus on the drive to maintain, deepen and enhance our development thrust.