EDITORIAL: Getting the financials in order
TWO THINGS HAPPENED recently that didn’t go unnoticed.
The first was a loud complaint from Derek Alleyne, director of the Urban Development Commission, about the “inexperienced” leadership of the National Union of Public Workers (NUPW) and the lack of up-to-date financial reports.
“We have not had an audited statement of the NUPW for the last six or seven years,” said Alleyne.
Not so, replied Akanni McDowall, president of the union. “For the first time in recent years of the NUPW, we have all of the financials ready. It is something we are very proud of,” he responded.
Not so fast. Yes, Mr McDowall can take credit for the audited financial reports but no, don’t shout to the rafters. There wasn’t a single valid reason why the NUPW should be in that state. After all, the union’s membership has a basic right to know if their organisation is financially sound.
The second thing was Standard Poor’s (S) decision to downgrade Barbados’ credit rating to CCC+ plus, the lowest rating in at least 20 years. Barbados is now in the company of Venezuela and Belize. Ours is now lower than Greece’s.
Explaining the downgrade, Dr Lisa Schineller, S analyst, alluded to the “uncertainty” surrounding the “magnitude of fiscal adjustments going forward”, suggesting that tough action was needed to cut Barbados’ unsustainable fiscal deficit. Such action cries out for a reduction of the long list of enterprises whose inefficiency is bleeding the Treasury dry.
The trouble is, we don’t know the full extent of the corporations’ needs because far too many of them haven’t completed audited statements. That’s where Mr Alleyne’s statement and S’s downgrade come in.
If the 60-plus corporations are to be “rationalised” and the newly minted financial advisory panel appointed by Minister of Finance Chris Sinckler is to do an effective job, it must make strong recommendations about the future of wasteful state enterprises. Some can be merged, others privatised, but too many of them haven’t presented annual audited financial statements to the public for years.
Sir Courtney Blackman, a former governor of the Central Bank, has been complaining for decades about the absence of such annual financial reports: “Audited financial statements are a crucial management tool, yet many of the state corporations fail to have them.”
Right now we don’t know how our money is being spent. That is an untenable situation which must be corrected. The ministers responsible for these enterprises must be held accountable for this sorry state of affairs. How can they go before Parliament during the Estimates debate and ask for more money when they don’t know if the agencies really need the funds?
Clearly, Cabinet ministers’ feet must be held to the fiscal fire. The current situation borders on recklessness. Let’s hope that Mr Alleyne’s own Urban Development Commission has up-to-date “financials” as well.