Rearranging deck chairs on sinking Titanic

Rushton Paray -
Rushton Paray -


THE MID-YEAR budget review for 2024 presented by the government, encapsulated in the Appropriation Act, is reminiscent of rearranging deck chairs on a sinking Titanic. The Minister of Finance appears disconnected from the harsh realities facing the nation, lacking the vision, innovation and leadership necessary to navigate the economic turmoil.

The addition of $2.3 billion to an already deficit-laden annual budget, without clear justification, underscores a pattern of mismanagement. As we approach the end of the ninth year under this current administration, it becomes evident that the government has failed to achieve any notable economic milestones, relying instead on imposing new and higher taxes as the primary means of revenue generation.

In 2015 the PNM promised to diversify the economy and foster growth in various sectors, moving away from a reliance on a single source of income. Subsequent assurances from the Minister of Finance emphasised the potential for growth and export in several industries.

However, the current approach, which hinges on the effectiveness of the Revenue Authority to extract more taxes from an already financially burdened population, paints a different picture. The imposition of property tax and increased utility rates adds further strain to a society where costs consistently outstrip wages.

The government's inability to stimulate economic growth is evident in its lack of response to the declining production of oil and natural gas. The supposed economic improvement cited by the minister last October is nothing more than a slight rebound from the pandemic-induced downturn, with the economy still 6.4 per cent lower than pre-pandemic levels. Even prior to covid, the government presided over a period of economic decline, marked by falling energy production.

The minister often hides behind the IMF Article 4 report, which does not reflect the on-the-ground suffering experienced by the population. The report fails to account for the high levels of underemployment, the struggles of small and medium enterprises (SMEs), and the pervasive economic stagnation.

The flight of capital and human resources, driven by crime and poor economic conditions, further exacerbates the situation. There has been no meaningful effort to create an environment conducive to attracting investment, leading to more citizens and small business owners seeking better opportunities abroad.

The government's failure to support the agricultural sector, despite the availability of skilled farmers and arable land, has resulted in an annual food import bill of $7.3 billion. This neglect only benefits a select few within the importation network. Similarly, small businesses continue to struggle, with no significant initiatives to bolster this critical sector that employs the largest number of workers and contributes substantially to GDP.

As we progress through this decade, TT finds itself once again grappling with the PNM's mismanagement, marked by an over-reliance on tax increases. While other nations are modernising their economies and fostering new industries, the PNM's approach is contributing to an increase in the working poor and enriching a small circle of privileged individuals. The measures outlined in the $2.3 billion supplementary allocations fail to address the underlying issues, offering no solutions to the country's economic crisis.

To effectively support the SME sector, the government must ensure timely VAT refunds, equitable access to foreign exchange, and more favourable banking terms and conditions. The agricultural sector needs more than lip service; it requires tangible actions to boost food production and reduce import costs. However, the current administration continues to spend excessively without addressing the root causes of inefficiency and mismanagement, particularly within public utilities like the Water and Sewerage Authority (WASA).

Despite a commissioned study highlighting WASA's overstaffing and inefficiency, the government has chosen to allocate additional funds without implementing necessary reforms. This approach is mirrored across various ministries, where funds are misallocated and inefficiencies persist.

In the face of increasing violence and crime, the government's response has been inadequate. The sensational coverage by international media, highlighting the brutal realities of gang life in TT, raises questions about the effectiveness of local law enforcement. The reappointment of the head of the police service, despite its apparent inability to tackle these issues, underscores a lack of accountability and effective governance.

As we navigate this mid-year review, it is clear that the government's approach to economic management remains flawed. The reliance on increased spending and tax collection, without strategic planning and reform, will not lead to the desired economic turnaround.

The nation requires comprehensive economic planning, inclusive of all sectors, to address the ongoing decline and steer the country towards growth and prosperity. Unfortunately, there is little expectation that the current administration will take the necessary steps to achieve this.

In conclusion, the 2024 mid-year budget review reveals a government out of touch with the pressing needs of its citizens, continuing a legacy of poor economic management.

Without significant changes in strategy and implementation, the country's economic and social challenges will persist, leaving the population to bear the brunt of these failings.

Rushton Paray is the MP for Mayaro


"Rearranging deck chairs on sinking Titanic"

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