PLP Leaders repond to 2020/21 National Budget Communication.
STATEMENT BY I. CHESTER COOPER MP
PLP DEPUTY LEADER, SHADOW FINANCE MINSTER
RESPONSE TO 2020/2021 BUDGET COMMUNICATION
FOR IMMEDIATE RELEASE
26TH MAY, 2020
PLEASE CHECK AGAINST DELIVERY
The budget communication today was uninspiring, unimaginative, unimpressive and, quite frankly, unbelievable.
This was not a communication worthy of a Minister. Serious business people have stopped listening to this Minister of Finance. The Finance Minister must be truthful – we did not need a political rallying speech, but a simple factual statement on the economy without embellishment.
It was the worst budget communication in living memory.
This is fitting I suppose, for the worst administration in the history of The Bahamas.
As expected, we heard a cocktail of blames: blame the PLP, blame Hurricane Dorian and blame COVID-19.
The precarious financial situation we find ourselves in today has less to do with Hurricane Dorian and COVID-19; however represents the cumulative impact of a series of bad fiscal decisions over the past three previous budget cycles.
Had this administration not exacted such misery on the Bahamian people under the guise of fiscal responsibility, and instead focused on job creation and economic growth, we would be better prepared to deal with the COVID-19 crisis and its aftermath.
The Minnis administration has squandered the past 10 weeks by failing to implement the common-sense fiscal measures that the party and myself outlined months ago.
This was also to put in place the digital and public infrastructure and necessary reforms for the future Bahamas.
We advised the government to act swiftly, to go hard and go early with a comprehensive plan.
All of this was before the recent sovereign credit downgrade and the negative outlook which will now make borrowing even more expensive.
To paraphrase the saying: You snooze, the Bahamian people lose.
As for the failures in the aftermath of Dorian, this administration has only itself to blame.
This administration wasted time creating additional layers of bureaucracy that slowed the restoration of Abaco and much of Grand Bahama.
We need not dwell too deeply in the past for the moment, but history informs where we are today.
The disbandment of the revenue task force and the Revenue Enhancement Unit, and an ill-advised VAT increase led to multiple failed revenue targets and the most rapid increase in borrowing in history, without a plan, without a strategy that resulted in nothing to show
Instead of borrowing to pay bills that could have been amortized, they could have borrowed to invest in agriculture and fisheries.
Borrowing from the owner of a dilapidated hotel that every right-thinking Bahamian begged them not to do, when they could have invested more deeply in technological advancement.
Borrowing to build plants at BPL that are still not fully operational, when they should have been investing in solar, wind and wave technology.
This unfocused and reckless borrowing and failure to properly examine the revenue regime have led to the largest deficits in our history, thus, the largest national debt in our history.
We warned the government to leave some borrowing headroom and a rainy-day fund for days like this, but they did not, hence, another downgrade of our sovereign credit rating.
And now, we find ourselves in the embrace of the IMF (International Monetary Fund).
We are hat in hand having to accept its “no strings attached offer”.
And this is usually where it begins.
We fear The Bahamas will have to enter into a structured lending program which will happen before this administration is voted out of office in 2022.
When you hear “IMF” from now on, remember IMF stands for – “It’s Minnis’ Fault”.
We told this administration to borrow wisely, borrow to invest in Bahamians.
In less than three years they borrowed more than $3 billion gross and close to $1.5 billion net with nothing to show.
Bahamians are still asking what in the world they did with all that money.
The self-proclaimed master deficit manager Minister of Finance has now brought us the biggest deficit and debt level in the history of our country.
The borrowing this administration has undertaken has been of no material use to this country thus far.
The lack of financial flexibility brought about by this administration’s failed revenue and expenditure strategy is why we see such floundering in response to Hurricane Dorian and COVID-19.
This administration’s poor handling of the economic side of this COVID-19 crisis has made things worse than they ought to have been.
The most honorable prime minister’s rank incompetence as the competent authority in this crisis has been on full display.
Businesses that did not need to close, remained closed, hampering revenue generation for a cash-strapped government.
Islands that don’t need to be closed, continue to be closed, continuing to deepen the crisis in these islands.
Services that could have been an economic boon, like the real estate sector, were not allowed to conduct business.
In the communication given today, we see that this administration has decided to take some advice from the PLP and start to focus more on people.
Now the FNM wants to beef up NHI after railing against it and treating it like an unwanted child.
The new monies allocated to the social services budget increase are not robust enough.
And frankly is a slap in the face of Bahamians after cancelling RISE and reducing other programs, like uniform assistance.
Ten weeks into this crisis – ten weeks – Bahamians continue to go hungry. They continue to wait on this food committee to create this food network. Many live in their cars still as they await responses from NIB and Social Services.
This out of touch administration gloats about having the courage to cancel breakfast and lunch at the House of Assembly after arrogantly raising the food budget last year.
They gloat about cancelling red plates for Cabinet Ministers when they ought not to have had them in the first place.
They gloat about reducing ministers’ travel just as they recently excessively increased it.
The duty reductions mentioned don’t cut the mustard either and building supplies should have been reduced years ago to spur construction and make home ownership more affordable.
The possibility of new fees due to cuts in subvention to state-owned enterprises now puts the burden on the public to fund entities the government should have had the courage to restructure.
So they will be asking us to pay more. They say no new taxes, but yes there will be new user fees.
Had the government committed what is now saying it will to small and medium sized businesses from the outset, the economy would have grown far beyond the point it had pre-COVID-19.
Recent studies have put the gap between need and funding for SMEs in The Bahamas at between $150 million and $200 million per year.
The work of the SBDC is admirable, but $55 million per year between the SBDC and the Venture Capital Fund for roughly a $150 million need isn’t going to cut it.
The intended investment in food security is too little and three years too late.
A food security investment of less than $2 million on a $3 billion import bill is another sign of lip service and not real action.
So where are the plans for Grand Bahama and Abaco?
These islands need structured assistance and can be drivers of a national rebound.
The lack of planning around a new hospital and airport in Freeport is completely unacceptable and the lack of a plan for the redevelopment of agricultural and industrial activity in Abaco is a major letdown.
And let’s not forget, they forgot Ragged Island once again.
Again, we urge this administration to beef up BAMSI to see more production output.
We do not use BAMSI strategically enough therefore we will not see result.
We urge greater reliance on public private partnerships, something that we have been calling for these past three years, and we welcome it.
These are precarious times for our country.
The majority of Bahamians have lost confidence in this administration.
They do not regard our prime minster as a man who is looking out for their interests, but rather the special interests that he surrounds himself with.
Nor do they regard him as a man who knows what he is doing.
Their failed policies have brought us to the edge of ruin.
We only pray that it is not too late to reverse the vast damage that has already been done.
We urge the Bahamian people to not be swayed by their slick videos and their colorful graphics that they will endure over the next few weeks.
This will not soothe the pain that has been inflicted upon the Bahamian people at the hands of this incompetent administration.
Overall, this is a budget about threading water and not about moving our country forward.
If this administration is going to add another $1.3 billion to the national debt we all should have much more to show the Bahamian people. Their suffering should be soothed and they should be much better off into the future as we build a progressive Bahamas.
Thank you. God bless you.
End
