To fully appreciate the conditions created by a social budget we must first understand that the budget is a process, which leads us to a vision of self-actualisation. It creates the environment for us to help ourselves and those of us who are willing to seize the opportunities provided can succeed and prosper if we work hard and consistently.

According to the International Labour Organisation in Geneva, “Social budgeting serves two main purposes. On the one hand, it is a part of the social policy planning and, on the other hand, it is part of any medium-term financial planning of the Government.

The social budgeting process normally includes the accounting of all social expenditure and income in a given observation year or a number of observation years. But social budgeting as understood here goes beyond the accounting of past events, it also provides forecasts of income and expenditure for normally a medium-term period and/or simulations of social expenditure and revenues under alternative economic, demographic or legislative assumptions. The latter aspect is a critical component of Government budgeting and mid to long term planning process.

Social budgeting is thus a macro-device in national financial planning, i.e. essentially the attempt to reconcile public and semi-public expenditure with tax and contribution revenues, it is an indispensable part of responsible governance in any society under any economic system.

The social budget thus supports the political decision-making process at the increasingly sensitive intersection between social policy and national financial planning. Social budgeting is therefore a crucial tool for sound social and fiscal governance.”

The Honourable Minister of Finance in his 2003 budget speech to Parliament said it in these words, “Mr. Speaker, we are cautiously optimistic that despite its inauspicious beginning, Year 2003 will see further advancement in the welfare of our people. As President Bharrat Jagdeo intimated in his New Year’s message the task of the Government will be to continue to forge a Guyana in which opportunities for all our people abound; a place where citizens are free, proud and can pursue their way of life in dignity. We have already developed plans and programmes to make this vision a reality. They find expression and elaboration in the PPP/C’s campaign manifesto for the 2001 elections, the poverty reduction strategy paper, the National Development Strategy and various public statements and pronouncements that have been made periodically.”

In every model the typical family unit is regarded as two working parents with two children. A family of four in Guyana can expect to benefit from the new tax threshold of 20,000 per month or slightly over 10 per cent more than they did last year. They can rest assured that the maximum tax bracket is still 33 per cent of any income after the tax-free allowance. I can recall in the eighties a maximum tax bracket of 75 per cent of every dollar earned and in most socialist countries it takes more than a 33 per cent maximum tax to fund a social budget.

We must remember that for those of us who work, as well as those of us who do not, our children can still go to school free and no matter what age we are, we can still obtain medical treatment anywhere in this county free of charge. This would not be possible in many of the developed countries to which we constantly aspire.

Guyana has always been below sea level and has always had as its primary output agricultural produce. We live in a land that is literally an open greenhouse. We cannot as a nation ever run out of food, as we can grow our own almost in every backyard. To maintain our good fortune in this regard the Government has to devote a considerable amount of its expenditure to sea defence works and drainage and irrigation projects. Unlike our counterparts in the Caribbean and elsewhere we fight a constant battle with the ocean and this is costly.

Another factor to consider is that we are a large country with 83,000 square miles of land and about 800,000 people. Unlike some of our neighbors and the developed world, we do not have a large working population capable of paying taxes but we still have to provide for a people spread out along the length and breath of our country. The amount of roads constructed and maintained each year in Guyana can cover the entire surface of Barbados yet they have many more times the number of taxpayers that we do. Consider also the sheer volume of electricity posts and wires, telephone networks and water pipes and one will quickly realise the disadvantage we work under each and every day as we strive to bring these essential services to every citizen across our ten regions.

Despite these burdens the Government still provides a labour system that is sympathetic to workers with a five-day work week and guaranteed vacation and sick days. Every Guyanese is guaranteed access to a union of his choice by our Constitution and the termination of employment laws provide for a guaranteed severance payment based on the number of years of service. The National Insurance Scheme also provides a guaranteed pension after a fixed number of contributions and while it may not be very large it is available to everyone who qualifies.

We still live in a society where every citizen can invest his own money in any business venture he chooses without a lot of government regulations to contend with. Anyone can establish a small business by simply registering a business name at a cost of G$2,500. Poultry farmers can get started without knowing anything about rearing chickens through contract growing of chickens with large producers and the local market is protected by a tariff of close to 100 per cent on imported chicken. Real estate agents need not go to school and sit exams or work with brokers for years before starting a business. Construction workers can actually build a house without even learning to read and write. These things are simply not possible in the developed world. These simple forms of investment add up and can sometimes have a greater impact than a single large investment.

And speaking of housing, a family of four can qualify for a low-income house lot from the Government which would provide enough land to build a comfortable home and still cultivate a sizeable garden. The family can obtain a low-income mortgage at government subsidised rates and will end up paying less in mortgage payments than they would in rent. As we all know the family would end up owning a property in less than 10 years, an accomplishment, which they would not have made elsewhere, or one that would have taken an entire lifetime under normal circumstances.

If viewed in this light we can see the benefits of persisting with a social budget. Each year a little more is accomplished despite trying circumstances to bring us closer to the vision of a free and independent people, self-sufficient in our own land with nothing to fear but ourselves.

In this year’s budget the Government has even made an extra effort to solve that problem with an allocation of over 7 billion dollars to be expended on national security.