BUDGET 2016: MORE QUESTIONS THAN ANSWERS (PART ONE)

BrianFrancisDisappointed and befuddled! Those are the appropriate responses this writer can immediately reflect upon to describe his attitude towards Budget 2016 as presented by the Right Honourable Prime Minister and Minister of Finance to the House of Representatives last week.

I am disappointed with the Budget for two main reasons: First, much is being touted about the success of a Structural Adjustment Programme (SAP) that to me was unnecessary at this time in our country’s economic and political history. Yet, because of that same SAP, our economy continues to function with austerity measures that are hurting ordinary folks badly and the Budget contains little that can potentially reverse that trend!

Second, as part of the 2013 general elections, the NNP presented to the people of Grenada a manifesto that promised among other things the creation of a “new economy” that would have transformed the socio-economic climate in the country in quite significant ways.  Had the government stuck to the programmes, plans, policies and strategies contained therein, Grenada’s economy would have been on a different economic growth and development trajectory and hence there would have been no immediate need for a formal structural adjustment programme with the International Monetary Fund because the promised “new economy” would have addressed many of the ills that the SAP is supposed to be now trying to resolve.

Why then has the government not used Budget 2016 as the basis for implementing some of the important aspects of its manifesto to begin the process of turning the economy around so that fiscal balance could be restored?

Come on Grenadians, please, go read pages 6-9 of the manifesto and decide whether my inference that the SAP was unnecessary is solid or baseless!  Don’t just take my word as the gospel!

Now you know why I am disappointed with the Budget.  But why I am befuddled? The answer to this question is actually very simple:  Budget 2016 was strange in both content and structure. To me, the Budget reads more like a political speech than an economic and financial statement that outlines the policies of the government for the next fiscal year.

Why all the emphasis on casting blame on a former government and Minister of Finance in a Budget being presented by a government that has been in power for almost three years? In relation to the structure of the Budget since when do we treat critical issues such as The Budget Framework, Economic and Fiscal Review 2015, Recent Economic Performance and Forecast for ECCU, Comparison of Income Tax in the OECS, Tax Rates in the ECCU, Public Sector Debt 2015, and Fiscal and Debt Indicators 2015 as “side shows” by placing details on them in Annexes and giving the public limited treatment of those same issues in the body of the presentation?  Are those not some of the key things that the Budget is supposed to deal with? Or have we changed our approach to the Budget?




You see, I recall listening to a programme a few years ago on the Fox News Channel in the United States with James Carvel as the quest. In response to a question from the Host about providing advice to former United States President, Bill Clinton, Carvel responded that “people believe we tell the President what to say but, in fact, as advisors, we usually tell the President what not to say.”  Why is this relevant to Grenada’s Budget 2016?

As a former Permanent Secretary in the Ministry of Finance, your humble servant would most definitely have advised the Prime Minister against both the content and structure of Budget 2016. In short, I would have been suggesting to the Prime Minister that he should not say some of the political things he said as well as not to structure the Budget Speech the way it was presented to we the people last week.

Did the current holder of the highest administrative office in the Ministry of Finance so advise the Prime Minister or did he allow the Prime Minister to waste a golden opportunity to begin the process of once more restoring hope and confidence in the Grenadian people, especially the poor and vulnerable, who support and vote for the NNP, by converting the Budget Speech into a political campaign rather than using the time to spell out a well-conceived economic plan for them and the country as a whole? Of course, I am asking these questions because it is quite possible that the Permanent Secretary did his job but the Prime Minister failed to accept his advice.

Grenada is at a rather crucial stage in its economic and political history. The government controls the entire Lower House of Parliament.  Why, then, do the Prime Minister and other Ministers feel the need to politicise every aspect of life in this country? Why when given the chance to convince Grenadians that the country is on a sound socio-economic path by outlining in a clear manner all of the programmes, plans and policies that their respective Ministries are putting in place to spur economic and social progress to benefit all of us, do they instead use an hour and a half to feed we the people NNP Propaganda?

Mr. Minister, do you really think that this writer and perhaps many thousands of Grenadians at home and abroad really want to hear about the goings-on in your Constituency vis-a-vis political activities during a Budget Debate?

A Budget is a serious one year planning tool. It is supposed to address government’s policies and plans for the upcoming fiscal year.  It is supposed to inform the nation about the measures to be put in place in the next twelve months to boost activities in the real sectors of our economy.  It is supposed to inform us of the projects coming on stream to generate employment. It is supposed to address the most pressing problems facing the country such as the dismal state of affairs of our health system.  And I can go on and on about the purpose of a Budget.

My question therefore to the Prime Minister and other Ministers is: Why waste the opportunity to convince we the people that you are capable managers of our economic affairs and hence deserve to continue to occupy position of power and authority in this beautiful country that is in urgent need of a huge stimulus to inter alia grow the economy in real, not nominal terms; create good-paying jobs for our women and young people; support entrepreneurial development; resolve our failed health system; reduce the fiscal deficit without massive increases in taxes and fees; and reposition the economy to make it more diversified and resilient to external shocks?

(Dr. Brian Francis, a former Permanent Secretary in the local Ministry of Finance, is currently a Senior Lecturer in the Department of Economics at the Cave Hill Campus in Barbados of the University of the West Indies)

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