Budget 2000 is $62.2B
by Gitanjali Singh
The government yesterday announced a $62.2 billion budget including a 26.66 per cent pay hike for teachers and the disciplined services, and a reduction in the sugar levy to $1 billion. However, it lacked specific measures to attract new private investment and placed heavy emphasis ($14.58 billion) on government expenditure in the housing, water and sanitation, health and education sectors. The budget, which for the second year running was devoid of new taxes, spelt out five specific measures, namely:
* no new taxes, fees or fines; The maiden budget presentation by Minister in the Office of the President with responsibility for Finance, Saisnarine Kowlessar, targeted expenditure at 22 per cent above last year's levels and allocated $1 billion for the holding of general and regional elections, scheduled by January 17, 2001.
Growth and development However, Kowlessar said, the one-off expenditure associated with holding general elections and the difficult external situation were expected to affect the macroeconomic environment. This notwithstanding, the government's need for financing from the domestic financial sector would be reduced as a consequence of large external capital inflows, and hence the private sector would have access to a greater amount of credit. The government, Kowlessar said, now intended to spend its energies to create the infrastructure for accelerated growth and development, to build on the strides made in the areas of health, education water and housing and to mitigate the adverse conditions that cause poverty. The government's public sector investment programme (PSIP) envisaged major construction and rehabilitation works in key areas. It was also expected that the Berbice River Bridge project would move ahead this year, along with the feasibility study for a deep water harbour. The Berbice campus of the University of Guyana is scheduled to start classes in October and the development of the Rupununi Savannahs to eventually create a 'Caribbean Corridor' to Brazil would proceed, along with the Linden Diversification Project, according to Kowlessar.
Infrastructure Substantial remedial work on sea defences was also programmed for Anna Regina, Henrietta, Reliance/Aberdeen, Devonshire Castle, Lusignan/Good Hope, Bush Lot, Turkeyen, Cornelia Ida, Bel-Air/Mon Choise, Trafalgar, Parika, Litchfield and Zeelandia. In the area of water and sanitation, three major integrated water systems were to be completed and operationalised at Pouderoyen, Rose Hall and New Amsterdam. Kowlessar said that the government was also looking for an early start in construction and rehabilitation works on the Bartica, Eccles and LBI systems. Pipe laying and related works on smaller networks in locations like Yakusari (Black Bush Polder), Williamsburg (Corentyne), Adventure and Melanie Damishana/Paradise, would also continue. Distribution systems at Siparuta and Kamarang and the refurbishing of water storage tanks at Hosororo, Barabina, Wanina, Morakabai, Achiwuib, Annai and Sarararu were all programmed for completion this year. In the city, the focus would be on replacing and rehabilitating the dilapidated sewage disposal system through the second phase of the Shelter Belt's rehabilitation programme when all sewage pumps and lift stations would be overhauled and or replaced. In addition, the life of the Mandela Avenue waste disposal site was to be extended for another two years.
Health and education In the education sector, target spending was $9.3 billion - $1.3 million more than the previous year - and was mainly to increase teaching materials and supplies, equipment and furniture and other fittings as well as undertake critical maintenance work. Thirteen new primary schools and 13 new nursery schools would be constructed. Forty-two schools, among them 12 secondary schools were slated for rehabilitation. The new primary schools were earmarked for Buxton, Beterverwagting, Golden Grove, Number Eight, Orealla, Sheet Anchor, Eccles and Queenstown. New nursery schools would be built at Hague, Pouderoyen/Crane, Enmore/Hope, Cotton Tree, Alness, Karasabai, Yupukari, Yakarita, Shulinab, Coomacka and Three Friends. The secondary schools slated for rehabilitation were Uitvlugt, Annandale, Belladrum, Tucville, L'Adventure, Fort Wellington, Vryman's Erven, Manchester, McKenzie, Campbellville and Dolphin. The reconstruction of Queen's College and the rehabilitation of President's College were also budgeted for.
Housing Areas to be covered in the regularising and upgrading were Lima Sands, Onderneeming, Zeelugt/Tuschen, Cornelia Ida, Par Fait/Harmony, Numbers 75 to 77 Villages on the Corentyne, Mon Repos, Non Pariel, Low Lands/Hope, Bath Settlement and Fortlands/Ordnance. The budget restated the promise that soon other financial institutions would be able to benefit from concessions similar to those enjoyed by the New Building Society (NBS) when extending mortgages to borrowers, through an amendment to the Income Tax Act. It also spoke of an amendment to the NBS Act to allow the society to accept security other than transport or certificate of title when issuing mortgages.
Job creation Dealing with policies to support job creation and growth, Kowlessar mentioned the historic business summit with President Bharrat Jagdeo and the private sector and the recommendations which had arisen from this. He committed his government to continuing to create opportunities and promote initiatives for the small business sector to grow. Funding for the Guyana Youth Business Trust, he said, would come initially from the government and the European Union, and he promised small business legislation this year to ensure the orderly development of that sector. The government, Kowlessar said, would be giving priority to increasing skills in the technical and vocational area. The Guyana National Service would be focusing on skills training in areas such as catering, office procedures, refrigeration, electrical installation, joinery, tailoring, and handicraft during this year. What the Budget means to you:
No new taxes
Increase for public servants, pensioners
Housing
Poverty programmes
Local governments
Parliamentary opposition says budget based on hopes The parliamentary opposition has described Budget 2000 as being based on hopes that would not be realised in an election year. They said that it did not address the real problems facing the nation. And PNC leader, Desmond Hoyte pointed out that the crises in the rice and forestry sectors were not addressed because the government was in a state of denial. Speaking with reporters after the presentation, the first by Minister in the Office of the President with responsibility for Finance, Saisnarine Kowlessar, Hoyte said, "overall we have had the typical PPP budget--no policy elaboration, but a number of things hopefully to be done." Hoyte said that the presentation was devoid of a "comprehensive economic framework against which the economy of this country will be managed." The PNC leader said that it was the same old tired rhetoric which the National Assembly has heard before, claiming that Kowlessar had done a "Nokta" which was to present "a long list of alleged infrastructure projects that they have completed or intend to complete. "And if you listen carefully to him, you will see that a lot of the budget speech is taken up with promises of things that they will do. Well, we hear that every year." Hoyte noted that there was nothing in the budget speech about tax reform. "One would have expected a proposal for comprehensive tax reform and not the ad hoc kind of matters he has dwelt upon." Neither, he said, was there a policy enunciated on investment as one would have expected nor the carefully spelt-out programme for poverty alleviation. Hoyte said that there was nothing in the budget "to address the fundamental problems of this society which have to do first of all with employment--no programme to generate employment to do with the various crises in our society. "He hasn't mentioned the crisis in rice, so the government is in a state of denial. As far as they are concerned there is no crisis in rice. But the rice farmers know that the banks are descending on them everyday, seizing their machinery and equipment." Nor, he continued was there anything "to address the crisis in forestry other than a threat, which we read about in the newspapers, to cancel leases and so on." The United Force leader, Manzoor Nadir, told reporters he too saw "this budget as one of hoping." He said that what the finance minister and the government had done was "played with the numbers hoping that the economy would 'rev up'." Nadir said that it was only if the economy 'revs up' that the targets and expenditure mentioned in the budget presentation would be met "because they could get more taxes at the same rate and thus they will be able to meet the expenses they are projecting. "If the economy does not 'rev up', which it most likely will not do, because it is an election year and people will be very cautious, we are going to see a bigger deficit than they are proposing right now." He said that the budget really was a series of "handouts to the so-called poor people to win their votes... nothing more." Nadir also said that the cost of the budget programme was no different from last year. He explained that if one took into account the "the devaluation of the Guyana dollar and then you take the consumption tax windfall from petroleum sales, we have basically been presented with a stagnation budget." For the Alliance for Guyana parliamentarian, Dr Rupert Roopnaraine, the budget did not address the central problem of the country--the political instability. But he welcomed "the across-the-board increases for workers" and said he hoped that the rise in prices didn't wipe out these increases. "... We have to hear something about the political issues for as long as the budget skirts around this issue then they are going to be in difficulties," Dr Roopnaraine said. The MP, who is also co-leader of the Working People's Alliance, commented on "the massive investment they are talking about acquiring. I don't know where this is going to come from while the political instability continues." Dr Roopnaraine mentioned the amount of aid from overseas, stating: "It has to come from there for the truth of the matter is that the conditions don't exist for increased revenue collection in this country. "No revenue creation or revenue authority is going to create magic. In an election year you are not going to raise the $12 billion or whatever it is they estimate to raise in the budget. It is not going to happen. All the rest is wishful thinking." Kowlessar's presentation was not the only first. PNC frontbencher, Clarissa Riehl, who is the deputy speaker, was the first woman to sit in the Speaker's chair for a budget presentation. And she also disciplined her first member, a colleague on the PNC benches, Andy Gouveia, whom she had the Clerk of the Assembly ask to leave the parliament chamber because he was improperly dressed. Gouveia's dress shirtjac did not have the stipulated two pockets at the bottom, as required by the rules of the House. One of her first announcements was the resignation of Dr Hughley Hanoman as a member of the National Assembly. The vacancy created by his resignation is to be filled by a name extracted from the PPP list of candidates.
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