The Federation of Independent Trade Unions of Guyana (FITUG), through an invitation from the Ministry of Finance, yesterday (September 07, 2018) met with Junior Finance Minister, Jaipaul Sharma and other officials of the Ministry regarding our body’s suggestions for the 2019 Budget. The Federation contended that the Budget ought to be developed within the context of the Government’s objective to deliver “A Good Life for All Guyanese”. On this score, we did share with the Minister and his team that the promised ‘Good Life’, for many Guyanese, is elusive and they have become despondent. FITUG shared that it appreciated the Administration’s upholding of pre-Budget consultations but expressed the view that the exercises have has adopted a mere ritualistic tenor and are nothing more but a public relations gimmick which really does not attract the sincere and profound consideration it deserves. We, nevertheless, expressed optimism that the 2019 Budget would give positive consideration to the reducing the difficulties our people must contend with.
The FITUG did share that the 2019 Budget, in all likelihood, will be the final budget before Guyana becomes an oil producing state expectedly in 2020. On this matter, we shared that we recognized Government officials explanations about the large sums that will flow to the country. We also pointed out the several concerns shared regarding the arrangements for oil production and contended that a better deal should have been hammered out. We noted too the Administration’s intention to establish a Sovereign Wealth Fund (SWF) which we felt, on paper, was a good initiative but noted there is strong need for institutional safeguards and appropriate policies if we are going to avoid the pitfalls that many countries have faced and are facing.
We urged the Ministry to be careful in the assumptions it is making regarding the Budget as we saw wide variances in what it projected and what the reality was. We lamented that, at least publicly, the absence of data for decision-making as we pointed to the absence of further Guyana Labour Force Surveys, Ministry of Finance Monthly Economic Bulletins and the timely release of Statistical Bulletins. We told the Ministry that there is no need to give us pie in the sky hopes.
The Federation noted that between 2014 and 2017, tax revenues have risen from $136.5B to $171.5B with the VAT and Excise receipts growing by nearly 25 per cent and Income Tax revenues rising by just over 31 per cent. We felt that this was a substantial increase, especially noting the timeframe. The large rise took place despite a reduction of the rate of VAT and improvements in the Income Tax regime and has greatly eaten into the imposed pay increases the Government has awarded and boasted about. On this score, we urged the Government to consider upping the tax threshold to $100,000 per month; introducing relief for taxpayers with dependents; removing the 1/3 income tax threshold and replacing it with a second tier at $200,000 per month; removing VAT from electricity, water and private health care; widening the income tax base through capturing those engaged in tax evasion; and re-aligning tax exemptions with employment creation and national development goals.
Our body also lamented the worrying unemployment situation. We noted that as many as 12 per cent of our people were unemployed at the end of September, last year and that 1 in 5 youths were without a job. Vexingly we pointed out that large proportions of the unemployed were jobless for more than a year indicating that jobs were difficult to come by. On this matter, we urged the Government to urgently consider training or re-training programmes for those who are unemployed. We suggested too the Administration consider the establishment of a National Job Bank to allow employers and prospective employees a central point to meet as we felt the Central Recruitment and Manpower Agency (CRMA) was not living up to its expectations. The unemployment situation, we urged too, should give rise to consideration regarding unemployment benefits for those who have lost their jobs. This is something long touted in Guyana and a considered study, we felt, may be appropriate at this time.
The FITUG also spoke to the high cost-of-living situation and using statistics pointed to increase in several important commodities. We noted too the soon-to-be-increased water rates which would see an unmetered consumer having to find more than $18,000 per annum to meet the rate increased. On this matter, the recent increase in the minibus fares was also mentioned as we noted it could very see workers having to find several thousand dollars more per month for transportation. We urged the Government to consider increasing the Old Aged Pension to $30,000 per month; reducing the excise tax on fuel towards reducing the public transportation costs; reintroducing electricity and water subsidies for old aged pensioners, among other things.
On the sugar industry, the Federation expressed its deep concern with what is taking place in the communities of the now-closed estates. The FITUG believes that the Government cannot and, in fact, should not ignore the plight that the workers, their families and their communities. We said state help to citizens in such situations is not unusual and rather is more the norm than the exception and we called on the Administration to consider an an income support mechanism to ensure families can meet their obligations and send their children to school, among other things; introduction of school bus services to transport all school-aged children from their homes to school and vice-versa; to establish an enabling mechanism to promote investment in the area with a view to spur job creation; to introduce or expand the school-feeding programmes; to establish skills training programmes to allow the former sugar workers and the youth to receive skills that are demanded by the labour market and matching them with available vacancies, and to provide social counseling and other require social programmes to assist in reducing depression and other social anxieties that have gripped the people.
We also addressed the matter of crime, and noted that despite the releasing of statistics which say that crime is on the decline people are fearful of being attacked, mugged or robbed. Banditry and criminal activities, from our interactions with workers, have been on the rise. We urged the Government to take a critical look at the allocations in this area towards improving crime fighting capabilities, intelligence gathering, and expanding emergency response. We also recognised that criminal activities cannot be divorced the rising unemployment and the lack of job opportunities.
The matter of public infrastructure was also raised as we noted that large sums were allocated and several main roads, bridges and other infrastructure were/are being rehabilitated. But we recognised that many communities have impassable roads, poor drainage, crumbling bridges, among other things. These realities have resulted in additional costs for our workers whether it be more regular repair to their vehicles, the higher possibility of contracting a vector borne infections, or their resort to utilizing makeshift arrangements to traverse to their homes. This situation, we urged should not ignored and we suggested the Budget 2019 seeks to strike a balance towards allaying these difficulties our people face.
Regarding public health, the FITUG noted that large sums were also allocated to this area but recognised that our working-people, when they visit public health facilities, are told, at times, they are no drugs available; or made to wait hours to see a doctor or told to return another day, for instance. We suggested an urgent review of spending in this area to ensure that efficient and effective services are provided to the populace; that procurement systems are geared to ensure the availability of drugs and there is an equitable spread of resources to ensure that our health centers and hospitals can adequately deliver services to a population in need.
We recognised too that resources are finite and wants are infinite and a balance must always be struck. The Federation shared with the Ministry that the Guyana Budget and Policy Institute found that “…more than $12 billion of the $17 billion in new tax revenues [went]to shore up the government bureaucracy instead of better aligning public investments with social and economic needs. The total cost of running the government increased by 29% for a total of $54 billion, the second largest share (20%) of the total budget”. We urged the Administration to give serious attention to re-aligning its expenditure with the needs of the nation. FITUG surmised that better allocation and more proper utilization of resources could also be reached through consolidation of services across the Government and the utilization of technology. We urged the Government should to consider the consolidation of services in specialized Government departments or through tendering to capable and reputable agencies.
The Minister in response thanked the FITUG for its suggestions and committed to considering them and to share them with his colleagues. He noted that some are workable but noted too that resources are limited. The FITUG is hopeful that the Government would favourably consider our suggestions as we see their implementation could see Budget 2019 being deemed “The first step to the Good Life”.
