Poverty reduction: A major goal of PPP/C’s policy

Dear Editor,
Immersed in the excitement of oil wealth, many Guyanese have been calling not only for direct cash transfer to every household but also asserting that oil wealth offers the best opportunity to produce the good life and for eliminating poverty. While exuberance about impending oil wealth is understandable, direct cash transfer has serious limitations; for example, it would not eliminate nor even reduce poverty; rather it would lead to dependency and entitlement that are unsustainable. It is important, therefore, that Guyanese’s lofty expectations be tamed with a dose of reality.
The Ghanian oil expert George Owusu stated: “I don’t believe in cash transfer; you must work for the money.” (Feb 2022). Mr Owusu’s view synchronises with this position: “any able-body person gains his/her self-respect and self-esteem through being a productive member of society.” However, the PPP/C is not averse to limited “conditional” cash grants for such projects as home ownership, business startup, education advancement, job creation, and scientific research to improve living conditions and reduce the poverty level. Its focus is on “empowerment” to provide a good life and lift people out of poverty.
Stunned by the 43% poverty rate in 1992, the PPP/C Government moved quickly to invite the Carter Center to develop a plan to reduce poverty. That effort resulted in the development of a National Development Strategy (NDS) and together with a Business Summit held in 1999 there emerged the Poverty Reduction Strategy (PRS). However, the PRS is not the only PPP/C’s Government approach to poverty reduction; others including the NDS, the NCS (National Competitiveness Strategy) and the LCDS 2030 (Low Carbon Development Strategy) are also critical policy instruments. Together, these strategy documents indicate that poverty could be reduced through the implementation of various measures such as providing affordable housing, job creation, and quality education. (Please see chart). The focus here is restricted to housing development, education advancement, quality healthcare, and job creation.
The Government is investing (G$) 54.5 billion in housing development in 2023. About 80% of the 20,500 house lots allocated between 2020-2022 have been awarded to low-income families. This means that over (G$) 25 billion annual housing subsidy goes to low-income families. The Government has established 44 new housing areas, constructed 827 homes for low and moderate income and professional people (with another 527 in progress), and regularized 6 of the 19 existing squatter settlements. These projects provide jobs for thousands of workers as well as expand household income and consumption and help to lift many households out of poverty.
Delivering quality healthcare to all regions is a top priority of the Government. With a budget allocation of $84.9 billion, the Government has moved swiftly to establish 6 state-of-the-art regional hospitals and one Paediatric and Maternity hospital at Ogle, plus the construction of a Hospital at Bartica. The Georgetown, New Amsterdam, and Linden Hospitals are scheduled for rehabilitation and expansion, while 4 tele-medicine centres will be established in Regions 1, 7, 8, and 9. Hundreds of workers, including those previously unemployed and those living in poverty, are being hired to work on these projects.
Buoyed by the distinctive honour conferred upon the Anna Regina Secondary School for being named the 2022 CSEC School of the Year for the Caribbean, the Education Ministry with budget of $94.4 billion is expected to play a significant role in the transformation of Guyana. In 2021-2022 the Government awarded 13,690 GOAL Scholarships at a combined cost of (G$) 2.3 billion. For 2023 and 2024 the projection for GOAL Scholarships is 6000 annually. By 2024, this GOAL investment alone translates into lifting 4881 households (or 2.1% of total households) out of poverty.
The cash and school uniform grant amounting to $5.8 billion and awarded to 147,000; the national school feeding programme that benefits 85,000 children ($2.1 billion); and $3.4 billion worth of textbooks would also augment the household income of thousands of households that live in poverty and progressively lift many of them out of poverty.
The Government has allocated (G$) 10 billion in budget 2023 for the continuation of the 11,000 regular part-time job programme at a 10-day per monthly rate of $40,000. By contributing an average of (US$) 6.5 per day (based on a 30-day month) to the household, many part-time workers are helping their households to rise above the official poverty line of (US$) 5.50 per day. About 4180 households (1.3% of total households) with supplementary income of $6.50 per day would rise above the ((US) 5.50) poverty line.
Together, the GOAL and job programme alone would result in a poverty reduction of 3.4%. With a budgetary allocation of $220+ billion for other sectoral programmes/projects, like in housing, health, human services, public works, agriculture, hinterland, and tourism, a further drop of at least 3.4% in the poverty rate would be realised. This rate (3.4%), combined with that of GOAL and job programme (3.4%) would result in a decline of 6.8% in the poverty rate from 38% (as of 2022) to 31.2% by 2024. And once the Government continues on this track, the poverty rate is expected to drop progressively to single digit by 2030.

Sincerely,
Dr Tara Singh