EDITORIAL: All eyes on Social Partnership
BASED on information which has been provided, an offer to advance the date of the next Social Partnership meeting to this Friday, August 11, 2017 has been made and accepted.
Much contention has surrounded what has been termed as the ‘lack of dialogue’ between the members of the Social Partnership, as has been suggested by the Barbados Private Sector Association and four unions. Some significant announcements regarding the future of the Tripartite Arrangement have to be discussed. What is the function of the Partnership? Is it an arrangement which was designed to chart a way forward in terms of coming together to address economic and social issues or is it designed to be something else?
Based on the Constitution, fiscal decisions reside with the Cabinet of Barbados and we accept that, since they are the ones judged every five years by their employers … the people of Barbados. That seems to be clouded recently by suggestions for deeper discussions on the way forward to chart a rebound in this country’s economic fortunes.
So what would be the role of the private sector and the unions? What do they want and do their objectives square with the fiscal realities of the country? The National Social Responsibility Levy (NSRL) seems to be the focal point of attention for the parties, in terms of its increase from two to ten per cent. That tax, as explained by Government, has been designed, in part, to narrow the gap in the fiscal deficit, which has to be addressed as restructuring of the economy is heavily dependent on eliminating the debt challenges.
So in terms of the unions – how does one square the call to reduce the tax by half to five per cent, with issues related to keeping the Civil Service numbers at existing levels? With a wage bill over $1.2 billion, if one looks at the deficit-enhanced budget, it represents a significant portion of the country’s expenditure. So Government adjusts from ten to five per cent, the deficit could drop by half, but it also will reduce the capacity to pay what we owe. It would still limit Government’s attempts to seek loans, if necessary, to further finance its operations.
For the Private Sector, we need clarity as to what you actually want. Government creates policy after consultation, but it does not have to accept suggestions. With measures also announced to curb foreign exchange spending, the question must be asked through introspection, as to why the level of outflow in foreign exchange is so high? Has the private sector made tangible proposals to keep our foreign exchange levels at acceptable levels? We go further – what policies has the private sector advanced to earn valuable foreign currency? Are we going to earn it or continue to borrow it at high interest rates? It is unsustainable.
We welcome any suggestion to have the deliberations televised. It is time for Barbadians to appreciate the economic realities which this country faces and hear from leaders at all levels, in terms of what they propose to address these problems.