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Budgetary choices


Peter Wickham

Budgetary choices

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Some have suggested that last Tuesday’s  Budget – the most feared in recent times –  could have been worse.
I, however, struggle to imagine how much worse  it could have been if by “worse” we refer to the degree  of bitterness of the economic medicine. I often identify philosophically with the Minister of Finance; however, my agreement with him on this occasion is unlikely  to move past the belief that some form of harsh economic medicine was necessary.  
There can be little argument that something needed to be done. I, however, have fundamental difficulties with both the timing and content of his package that conveniently avoided “large elephants” and touched other issues in ways that were most unfortunate.
Any analysis of the Budget should be framed  against the background of key commitments made  by the Democratic Labour Party (DLP) in the February election that there would be no dismissal of public servants and no sale of Government’s assets. These commitments were made for obvious reasons; however, the wisdom of continued adherence to a perverse interpretation of these principles lacks both political and developmental wisdom.
The Minister set out to deliver a package which avoided those measures and superficially he did,  so perhaps, he should be awarded a prize  for political genius.  
The crass manipulation of the concepts of “privatization” and “public sector downsizing” imply  a presumption that the DLP believes us to be less intelligent than we are. In reality, this Budget has implicitly introduced both and in ways that might  well be more negative.
The acronym PPP (public-private partnership) emerged well before the Budget and was blessed  by this year’s statement and, as I understand it,  this arrangement will shift substantial work which  the public sector normally undertakes towards  private contractors who, coincidentally, are all large and friendly with this Government.
These arrangements are likely to achieve greater efficiency which is, for all intents and purposes,  a programme of privatization and counter to the DLP’s stated position.
The other side of this issue is the promise not to “downsize” which remains the elephant in the room.  In fairness, the Minister has not specifically referred to it, but one needs to ask what is the logical consequence of major cuts at institutions that are funded by the state alongside a PPP. Spending cuts at the National Conservation Commission (NCC) or worse, the Queen Elizabeth Hospital (QEH) must of necessity impact  on jobs since so much of their spending is related  to human resources.
This approach is replicated across the board in  a way that demonstrates the Stuart Administration’s lack of either the willingness or the testicular fortitude to face the reality of what needs to be done. Instead  of clearly stating their intention to send home workers, they have taken a decision to let board chairmen  and technocrats do the dismissing for them.
The Budget’s failure to live up to the DLP’s  promises speaks partially to my difficulties, while  the other aspect is a profound discomfort over  the types of choices that the Budget implies.
Nowhere is this concern more acute than with respect to decision to charge University of the West Indies (UWI) students fees. There can be no question that the scale of the contribution that Government makes to the UWI is excessive and unsustainable  but the approach to correcting this problem reflects  a draconian and fundamentally backward developmental step.
In previous presentations, the same Minister spoke about the origin of this problem which summarily appears to be the establishment of the new medical faculty, along with a peculiar arrangement which allows UWI to determine its intake and thereafter send Government a bill in respect of Barbadian students. Moreover, it is clear that several of these students have not been performing with dire economic consequences for the taxpayers who have funded “long stay” students. One would think that the preferred solution would be to address these problems directly instead of punishing an entire generation in this way.
These types of poor choices are replicated across  the Budget and reflected in inclusions and omissions. As such, the Government is committed to retaining control of a large inefficient and highly overstaffed Caribbean Broadcasting Corporation (CBC), while  cuts are made to the budget of the QEH.  In all if this, there is a curious unwillingness to release valuable assets like the airport, seaport, postal service and  the Sanitation Service Authority, while in the latter  regard, we are all now being taxed more heavily  to pay the SSA to continue to be inefficient.
This all reflects a perverse philosophical perspective to which we will be subjected for the remainder of this parliamentary term.
• Peter W. Wickham ([email protected]) is a political consultant and a director of Caribbean Development Research Services (CADRES).

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