“Fluff and bluff budget cannot deliver the good life” – Ali
2019 Budget debates
Opposition Member of Parliament (MP) Irfaan Ali kicked start the 2019 Budget debate in the National Assembly on Monday declaring that Finance Minister Winston Jordan is providing inflated estimates aimed at giving Guyanese an “imaginary good life”.
Ali voiced his displeasure over the Government’s $300.7 billion Budget, saying the presentation was sugar-coated ‘fluff and bluff’, adding that 63 per cent of voters signalled that they were not fooled by what he deemed was Government’s inability to improve their lives.
Ali, who is a former Housing Minister, said that Government’s budget was poorly forecast with no measures to aid the “ailing economy”, further saying that it was riddled with wasteful spending on items such as $5.9 billion on dietary needs and billions more for accumulated expenditure on other refreshment and meals, local travel and security for Ministers. Despite the Finance Minister’s near five-hour presentation last week, the People’s Progressive Party/Civic (PPP/C) Executive was adamant that the forecasts presented were “consistently inconsistent” with Jordan’s speech, disputing Government’s announced measures to “reduce taxes”. To this end, the former Housing Minister highlighted that the tax revenue for 2019 will be $93.6 billion more than the actual tax revenue for 2014.
“In the speech we also heard about fantastic projects, but their economic feasibility not yet determined and no funds have been set aside to support these projects based on the estimates,” Ali told the House.
These relate to several road projects across the country and the Demerara Harbour Bridge feasibility study, which was sole sourced for $150 million. The Public Accounts Committee (PAC) Chairman also highlighted procurement breaches such as the $ 1.1 billion spent on the D’Urban Park Project. Ali noted that Minister Jordan omitted to highlight that sugar production for 2017 was approximately “57 per cent less than the level reported for 2014”.
“Export revenue from sugar was US$39.5 million (or $8.3 billion) less than the level reported for 2014. The export revenue for rice and bauxite also contracted by US$48.5 million (or $10.2 billion) and US$17.6 million (or $3.7 billion) respectively between 2014 and 2017…Timber production fell by 30.9 per cent between 2014 and 2017, causing the export revenue from timber products to reduce by US$20.2 million (or $4.2 billion) Meanwhile, diamond production contracted by 47.9 per cent thereby causing the export revenue to decline,” Ali told the House.
He outlined that this year’s budget saw little or no significant allocations for youth and at-risk groups such as single-parent mothers. He in fact believes that this year’s budget was crafted to give an inaccurate impression of the improved standard of living Guyanese were expecting.
Ali pointed out that the forecasts for the sugar sector were $4.3 billion and $5.3 billion above the actual contribution of this sector in 2016 and 2017 respectively, adding that the forecast for contributions from the gold industry was $2.7 billion above actual contributions from the sector in 2017. He noted too that the revised estimate regarding the contribution of this sector is also projected to deviate from the initial forecast in 2018 by $11.3 billion. The PAC Chair explained that owing to these and other forecasting errors, the Minister was forced to revise the real
economic growth rates for the past three years downwards.
“Based on new Balance of Payments presented by the Minister in the 2019 Budget, the deficit for 2018 is projected to be more than two times the forecast he gave last year and may be responsible for the unplanned depletion of the international and gold reserves of the Bank of Guyana,” Ali observed.
The PPP/C MP opined that Government had to first acknowledge problems existed in the economy before they could be solved rather than MPs putting their “heads in the sand”. Ali noted many of the troubles in the various sectors could be linked to tax measures imposed, especially on the productive sector for which the former Minister said his successors were unwilling to accept that there was a decline. “Since assuming office in 2015, this government has budgeted and expended more than a trillion dollars. Unfortunately, a large portion of the Government’s expenditure has been channelled into areas that do not improve the well-being of our people or stimulate economic growth,” Ali stressed in his speech. He said that the combined total amount spent on other refreshment and meals, local travel and security for Ministers in 2018 was 2.6 times the total amount allocated to maintain bridges, roads, drainage, irrigation works, sea and river defences and other infrastructure. He added that it was 47 times more than the increases given to our elderly in the form of Old Age Pension and Public Assistance.
“The amount proposed for these frivolous activities in 2019 approximate $5.7 billion, which will be 2.7 times greater than the amount budgeted in 2019 for maintaining roads, bridges, drainage and irrigation works, sea defence, and river defences and other infrastructure that would benefit all Guyanese rather than the select few at the top of the food chain, 22.9 times greater than the $800 million that pensioners are expected to benefit from in the form of increases in Old Age Pension and Public Assistance during 2019,” Ali disclosed.
Days before his presentation, he was arrested at 04:00h by ranks of the Special Organised Crime Unit (SOCU) and later faced 19 charges relating to lands the State says he undersold. The Opposition holds out these are politically trumped-up charges instituted just after the coalition was defeated at the recent Local Government Elections (LGE) where the PPP/C won 61 per cent of the popular vote.