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Budgetary thoughts

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Debate on the 2009 Budget is scheduled to conclude today with the approval of government’s programme of expenditure and revenue for the New Year. Unfortunately, my own work schedule didn’t always permit me to follow the debate, but I can’t help commenting on a recurring theme. Why do the parliamentarians always say- “The best Budget ever” (if on the side of the Government), or “Worst Budget, hurting the poor” (for Opposition Parliamentarians)?? Why?{{more}} Do they compare the Budget with previous ones?

That aside, all are agreed that presenting the 2009 Budget was no easy task. So it turned out to be. The one comfort for the Minister of Finance and his staff in compiling the budget is that their frustration was being shared by tens of thousands of similar employees in Finance Ministries throughout the world, from the Unites States of America to Zambia, from the United Kingdom to China, from France to Japan, as they grapple with the fallout from the global economic crisis.

Responses to this crisis vary from country to country, depending on circumstances, philosophical and political orientation, and, quite frankly, space available for manoeuvre. In the citadel of world capitalism, the USA, President-elect Obama has already signaled his intention to try and refloat the ailing economy which had suffered under the incompetence of the Bush years. Addressing the unemployment situation and rescuing the manufacturing sector are high among his priorities. The British government faced with deep recession is responding by massive borrowing to revitalize the economy, offering tax cuts to the middle class and workers with plans to increase taxes when the economy recovers. In the Caribbean, the Prime Minister of oil-rich Trinidad and Tobago has slashed $3 billion from its 2008/09 Budget.

With a global scenario like that, given our own problems here at home, not to mention our ambitious, but necessary, International airport project, it would not have been out of place if the PM/Minister of Finance had preferred a Budget of restraint and cutback in expenditure. Yet, even though the overall Budget is $6 million short of the 2008 figure, recurrent expenditure is, in contrast, up by $36 million or 7 percent. It is the capital side of the Budget where the decreases are reflected, both in expenditure and receipts.

Remarkably, the government has been able to maintain its commitment to what it refers to as the “poor and working people”. This is reflected in its holding of the line on contributions to the disadvantaged, elderly and underprivileged. What one can question, though, is that whether in the current circumstances the continued payout of Christmas bonuses to central government employees, well-intentioned and greatly welcomed no doubt, are advisable at this time. The Budget already provides a number of pro-worker measures, including further tax relief, and while it is necessary to be bold, caution is not an entirely bad trait.

If anything, in complimenting the PM, one can’t but help but being concerned whether the right message is getting across. A government, no matter how positive, how pro-poor, cannot do it all by itself. There is a sense in which many of our people are becoming dependent on the ULP to deliver. What is our role? The reality of the present situation is that there are simply “no free lunches”. We need to get that stuck in our collective cranium. In order for the government to sustain such worthwhile social programmes, we must not only WORK HARDER and PRODUCE MORE, but we must be encouraged and facilitated to do so. Sacrifices will be necessary in the process if we are to lay the foundation for sustainable development. We cannot get all today.

In addition, we have to, side-by- side with the WAR ON POVERTY (Kudos to the PM for paying it so bluntly), wage a war against the blatant consumerism which is devouring us. We are talking our way (via mobile phones) to debt and poverty, “trussing,” our way (via hire purchases we can’t afford) into bankruptcy and “blinging” our way into the pit of economic despair. In return, our health is suffering, our balance of payments deficit increasing and agriculture and local production suffering.

This must become part of the overall message. “One hand can’t clap”. Our development thrust must include us all, every sector. The private public sector partnership and the special role for civil society must be cemented and nurtured if we are to succeed. The provision of $25 million, funded from the National Insurance Services to fuel development in fishing, agriculture, manufacturing, tourism and information technology, must be lauded. We must now move to ensure that the relevant partnership and governance structures reflecting the growth and development of these sectors are put in place and give them room for further development. Partnership is the only basis to guarantee such progress.

Renwick Rose is a community activist and social commentator.