GOVT’S PLAN OUTLINED

Government is intent on achieving a balanced budget by 2019, and to do so without any new financing requirements.

That was but one of the objectives of the new Government, which was outlined in the Throne Speech yesterday.

Along with that, Governor General Dame Sandra Mason told those attending the State Opening of Parliament in the Senate Chamber, that the Mia Mottley-led Government intends during its five-year term to follow through with all of its campaign promises. Among those would be to provide a Cost of Living Allowance to civil servants should negotiations with the trade unions on salary increases not be concluded within the next three months; raise the non-contributory and contributory pensions; raise the minimum wage to $8 and extend it to all categories of workers across the economy; pay the reverse tax credit of $1 300 for those earning less than $18 000 yearly; and abolish the controversial National Social Responsibility Levy (NSRL).

In the presentation that lasted close to one hour, Dame Sandra, noting that Government has commenced its mandate at a time of “unprecedented economic and social uncertainty for Barbados and its people”, characterised among other things by a stagnant economy, excessive taxation, unsustainably high levels of debt, decaying sewage systems, and inadequate foreign reserves to safeguard the value of the local dollar, said that Government has identified urgent national challenges as mission critical issues – 20 in total – which must be tackled with urgency and be resolved.

Not to address these issues, she said, would result in severe consequences. In that respect, Dame Sandra said over a period of six months, Government will focus on addressing all mission critical issues and clear guidelines will be set for deciding on and applying the identified solutions.

“Dedicated mission critical teams, comprising public servants and highly experienced professionals, recognised nationally, regionally and in some instances, internationally, will be established and tasked to ensure delivery. More important, proper management structures will be put in place to prevent these issues from reaching crisis proportions again,” she added.

Speaking specifically on the economy, the Governor General noted that from day one Government has been tackling the national debt and failing foreign reserves, and has started the process of restructuring the public debt and renegotiating existing obligation. At the same time, she said balance of payments support is being sought from the International Monetary Fund. With that in mind, Dame Sandra added that the Government intends to craft a comprehensive Barbados Economic Recovery and Transformation Plan, which it intends to consult extensively with the Social Partners on. The goal of that Plan, she explained, is to ensure that the burden of economic adjustment is shared fairly and does not fall disproportionately on workers. It is in that vein, she said, that the goal is to achieve a balanced budget by next year.

She added not only does Government remain committed to a fixed exchange rate and to preserving the value of the Barbados dollar, but the intention is to pursue policies to restore our foreign reserves cover to at least 15 weeks. Dame Sandra indicated that this is to be achieved through stimulating investor confidence and allowing Barbadians to retain foreign exchange they have earned in foreign current accounts in Barbados. Such Barbadians, she added, would be eligible for a foreign current tax credit on all foreign exchange earned.

Word of that came as she reiterated the manifesto pledges of the Government to return Value Added Tax to 15 percent within 18 months; abolish Road Tax and the NSRL and repeal the need for tax clearance certificates and the Municipal Solid Waste Tax (MSWT). In respect of the latter, Dame Sandra stated that a tax credit will be given over a period of time to those who paid the MSWT.

Additionally, referring to the “extraordinarily high” government arrears to citizens, corporation and institutions, which at September 30, 2017 totalled $1.7 billion; she said steps will be taken to bring those arrears down. According to Dame Sandra, a dedicated team will be assigned to work with affected individuals and companies on a plan to settle the arrears, and a structure will be created for regular on-time payments owed by Government to be made. She added that once that system is up and functioning well, where late payments are made, the Government will be required to pay interest and penalties. (JRT)