Finance Minister Chris Sinckler delivered the Budget to an anxious nation wondering what drastic measures could be effectively applied to turn things around?
Key phrases such as “institute a sequence of managed structural adjustments and reforms”, “until global growth and recovery is evident, an 18-month programme of fiscal adjustments and specific growth initiatives will have to be implemented to pull our economy around, stabilize and grow the international reserves and create new jobs through major private and public investment” and finally, the theme is of Growth and Development Strategy 2013-2020 is “Adjustment, Reform, Recovery and Sustainability”.
I don’t think the Minister actually said the words “trust me”. However, given the amount of scepticism expressed after the Central Bank reported that the Medium-Term Fiscal Strategy yielded an economy-threatening situation, trust was definitely on the table.
There is a lot of activity in the proposed plan. Increased taxation would provide some additional revenue, reductions in expenditures through a hiring freeze, transfers and subsidies were hit, reverse tax credits were reduced and “free university education” came to an end. Beginning in 2014, students will be required to pay tuition.
The projected “investments” called for increased expenditures primarily aimed at tourism, increased hotel plant (read jobs) and yet another scheme to make sugar viable. Each of these has major “baggage” in terms of unmet performance targets.
The new strategy was deemed to be more aggressive than its predecessor, which was stoutly defended for more than four years. As a management consultant, I am trained to assess the likely impact of what is proposed and raise questions about possible alternatives.
I am not an economist, a financial expert or a political scientist but I do have extensive experience dealing with human performance, service excellence and organizational behaviour. I am also mindful of Governments’ poor track record regarding implementation over many years.
Here are some questions that were not addressed:
1. With the hiring freeze, many people will indeed be “frozen” in the old way of doing things. The history of public sector reform speaks for itself and the hiring freeze makes it more difficult. How will issues of low productivity, low employee engagement and chronic poor service be addressed in this plan?
2. The proposed investments in Four Seasons and Almond Resort have been justifiably questioned but when and how will the issue of a transformative approach to service excellence be started? Poor service is now a recognized national liability. Why is this not a high priority with clear measurements to track the progress?
3. The team to review and recommend the consolidation of statutory corporations seems to be entirely made up of insiders with vested interest. A credible, objective professional should guide such a process to ensure integrity, transparency and linkage to an overarching vision of success. Those within the respective organizations have valuable roles to play but examining themselves is not likely to yield more than an arrangement of mutual convenience. What safeguards are in place to address these risks?
4. Where is the low-hanging fruit? What actions can be taken right now that can give us some quick wins and build our trust and confidence?
5. The message seems to be: “We will engage in these activities for 18 months and hope external forces get better by then”. Is that the vision?
