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Last Updated: Feb 13, 2017 - 1:45:37 AM |
"The Ingraham/FNM lottery: Sold out the poor and middle class"
By Bradley B Roberts, National Chairman, Progressive Liberal Party
Apr 3, 2014 - 7:07:05 PM
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 A writer identified as Simon/Front Porch wrote an op ed published in the Nassau Guardian accusing the PLP government of selling out the poor and middle class. After painting a picture of gloom and doom about “largely stagnant wages and significantly less disposable income” as the new normal in the wake of the Great Recession, the writer went on to say that “for many poorer Bahamians, incomes and prospects continue to worsen.”
The writer then penned a remarkable statement. The writer opined that “during the 2012 general election the FNM, led by Hubert Ingraham, offered a variety of proposals in response to what promised to be a slog toward more vibrant economic growth amidst a dramatically changed economic environment post 2008….Ingraham promised what he thought the country could afford given fiscal constraints.”
Since the pretext of the requiem of gloom and doom enunciated in the opening paragraphs was to apparently and simply blame Christie and the PLP for the precipitous economic decline of the middle class and the poor, the writer must answer under whose governmental watch this precipitous decline took place. It is instructive to the writer to note that between 1992 and 2012, the FNM governed this country for fifteen of those twenty years and much of the decline among the middle and class and the poor took place during that period. It is a well-known fact that the Pindling government built the professional class, the middle class and expanded the wealth of the merchant class beyond their wildest dreams as the government built the modern Bahamas.
This decline the writer refers to took place during the last twenty years and was exacerbated by the last global recession, but Christie and the PLP did not govern The Bahamas during that last recession, therefore cannot be held responsible for the fiscal management (or mismanagement) of the Bahamian economy during that period. Prime Minister Christie inherited an economy in shambles and a government whose public finances were teetering on the brink of collapse and at the edge of the fiscal cliff. In May 2012, there were 30,260 unemployed Bahamians and the country faced a budgetary deficit of some $500 million and a decline in revenue of more than $260 million over what is was in 2007.
Further, some 4,000 homeowners were faced with varying levels of foreclosures on their properties. Christie and the PLP had nothing to do with this sad state of affairs, but were hired by the Bahamian people to clean up this mess. It is Christie and the PLP who are gradually and systematically pulling this country back from the fiscal cliff through a multi-tiered fiscal consolidated plan. According to Prime Minister Christie, this plan consists of four key parts: growing the economy; restraining expenditure; enhancing revenue administration and securing new sources of revenue. The record also clearly shows that the government is receiving high marks from international agencies for its fiscal consolidation plan.
Since the whole purpose of the article by Simon Front Porch was to lay blame unconditionally at the feet of the PLP exclusively, then the above piece of historical context is necessary in the interest of fairness, balance and intellectual honesty.
This writer also tried to paint a picture of fiscal prudence on the part of the FNM, writing that “many of the economic and social proposals offered by Perry Christie and the PLP significantly more expensive than the FNM, which did not seek to outbid the PLP’s more expansive promises.” Well, let’s examine what the FNM actually did while in office. They cancelled an $85 million public road works project and replaced it with a project initially valued at some $113 million that ballooned to over $200 million, more than twice the cost of the cancelled project. The FNM inspired jobs training program was budgeted at $24 million, but ended up costing tax payers some $50 million with no accountability on how many persons were trained and the disciplines in which they were trained. This is in stark contrast to Christie’s National Training Agency. I will go further – when questioned about public expenses during his last term in office, former Prime Minister Ingraham said “look around.” Ostensibly, the former PM was implying that the $2.5 billion borrowed between 2007 and 2012 were all spent on public works (infrastructure and superstructures). Well, almost $500 million in one-offs collected by the government during that period more than covered the cost of the public works. This then begs the question of how the more than $2.0 billion in borrowings were expended. Given these facts, Simon had to have made that statement about “fiscal constraint” in jest.
The writer said “Christie intervened to assist his upper middle income chronically tax delinquent VAT coordinator with mortgage relief, despite having abandoned the vast majority of those he promised to help who were on the verge of losing their homes.” This statement is simply not true. Just as Prime Minister Christie called the bank to assist the VAT Coordinator, he used his office as Prime Minister to summon the clearing banks, agreed to a mortgage relief plan and authorized $10 million of public money not to assist “his upper middle class” colleague or friend, but Bahamian homeowners in general facing foreclosure. Also, it is an inconvenient fact to Simon and other critics that many delinquent mortgagees with the Bahamas Mortgage Corporation are still in their homes because of the policy of the Christie government. The Chairman of the BMC has repeatedly and publicly called on all delinquent mortgagees to come in and speak with them to negotiate a more workable arrangement. The Chairman is acting on the policy directive of the government. This “tale” about the Prime Minister helping only his special friends and ignoring everybody else is patently untrue but people who clearly know better or should know better continue to repeat this untruth over and over again to wrongly influence public opinion.
On the issue of Value Added Tax, the government was clear that it needed to broaden its tax base given the increased fiscal demands on government operations. The government collects in taxes between 16.2 to 18.2 cents on every dollar generated by the economy. Further, Its intent to ascend to the World Trade Organization required a harmonization of the Common External Tariff or customs duties. The government has proposed a reduction in customs duties amounting to some $300 million and the introduction of a Value Added Tax regime that captures both goods and services that is projected to raise between $500 million and $700 million. The government has consulted on this tax reform measure extensively, both locally and internationally as it seeks a consensus with the business community, a key stakeholder. Many have asked for more time and the implementation date was extended.
On this particular issue of tax reform and many other national issues, it is easy and lazy to sit in the tall grasses and throw stones in the form of criticism, half-truths, political spin and untruths, but to date, only the governing PLP has presented viable plans to address the myriad of challenges facing this country. The FNM, the political organization that governed this country right up to 2012 concede that while they accept the need of tax reform, they will oppose VAT in parliament, but also concede that they have no tax policy alternative to the proposed VAT. Go figure.
© Copyright 2014 by thebahamasweekly.com
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