[xml][/xml]
The Bahamas Weekly Facebook The Bahamas Weekly Twitter
Bahamian Politics Last Updated: Feb 13, 2017 - 1:45:37 AM


Hon. Peter Turnquest Mid-Year Budget Statement
Feb 17, 2015 - 7:53:11 PM

Email this article
 Mobile friendly page
The following is the Mid-Year Budget Contribution Statement by Hon. K Peter Turnquest, MP, East Grand Bahama:

Unlike the Prime Minister who spoke last week in his Mid-Year Budget Presentation, I stand before you today very concern, as do many Bahamians about our nation’s economic future! After all the promises made and with all that has happen in this country since May 2012, Mr. Speaker this government have been more LUCKY than GOOD.

To quote the Minister of Finance, “The sunlight is broken through the clouds. Bright days lie before us now. We are standing tall, our heads held high, our hearts brimming over with faith in our country and optimism about our future.”

Very nice poetry but most Bahamians want to know what world does this Government live in? With unemployment at 16% in New Providence, 18.6% in Grand Bahama, 20.3% in Abaco and with youth unemployment of 31.2%, the highest it ever been, what are they talking about!

Many families find themselves no better off today than they were in 2012 and in many instances, worst off than they were. Many have expressed their regrets and disillusionment in this government and their inability to simply do what they said they would do….they HAVE FAILED US!

Today we live country in which rising Crime now accompany rising prices, rising unemployment and a rising number of young persons with declining hope of a stake here at home for them. Even while the Government foreshadows a desperate hope that BahMar will rescue

its failure to deliver the 10,000 immediate jobs promised, despite having almost three years to do so in a period of general economic recovery.

Despite the fuzzy math that side continues to repeat in this Honourable House to confuse the statistics, the truth is that the total number of unemployed persons IS 2,415 higher today than it was when this government came to office and is unfortunately rising.

So yes, we must all pray for BahMar success and trust that the ongoing dispute over the road cost will not mar the opening date.

Economic Developments

Mr. Speaker, the government is seeking to take credit for the external global economic recovery which has positively stimulated some pockets of our economy; But these were the same external global factors which during 2007 to 2012 were responsible for the very negative downturn in our economy which before coming to office this government convinced Bahamians, did not exist!

Today they are boosting that “we have weathered the storm”; “The worst is behind us’; my how their tongue has changed since coming to office.

Mr. Speaker, with the continue raise in unemployment, the unacceptable surge of crime, the increase dependence on our welfare system, the inequality of

opportunities and the disenfranchisement of young Bahamians there is much that this government needs to do and very little it has done to boast about. After listening, watching and seeing this PLP administration at work it is no doubt this government have been more LUCKY than GOOD.

Mr. Speaker, the average household income has decreased over the last two and a half years in real terms making the call for a minimum wage and pension review relevant as more of the social burden is passed onto the private sector to cover inefficiencies, waste and grandiose promises.

Mr. Speaker, the Government projects that real output in our economy is expected to be over $600 million larger in 2017. A very futuristic statement Mr. Speaker, and to the informed investor, full of speculation and undeclared risks.

To take this projection into context however, it would be useful to note that the Bahamian economic share of the world’s total GDP, adjusted for purchasing power parity, was 0.01% in 2009 and is forecasted to be 0.01% in 2015, no change. In other words, don’t get swing by these numbers as they are dependent on global economic forecasts, not the Bahamas in isolation. As the Government is quick to point out when it fits their purpose, we have an open economy that is vulnerable to external conditions, particularly the United States economy and so as one goes, so does the other; very little to do with direct Government effort.

But what does the Central Bank say about the economy? The data seems to indicate that perhaps it’s too early to predict success for this Government.

According to the latest Central Bank Fiscal/Real Sector Indicators schedule, total debt from May 2012 to December 2014 has grown by $2 billion, from $3,559.6 Billion to $5,565 Billion. The external portion of that debt, the most risky part, has grown by $797.2 million over the same period. Yet, the government brags about the success of its plan to date. How exactly do they measure success Mr. Speaker?

According to the Bank, credit quality conditions remained stressed, with private sector loan arrears increasing. Mortgage and commercial loan delinquencies were also higher, loan loss provisions have increased and credit policies have been tightened and $100 million in bad loans have been transferred to Bahamas Resolve Corporation. But yet they boast?

Had it not been for the significant drop in oil prices, this situation coupled with the inefficiencies of our energy sector and VAT, many businesses would not survived this hostile period and inflation would have had a much bigger rise. This Government has indeed been more LUCKY than GOOD.

Instead of taking advantage of the lower oil prices however, the government continues to fumble with its energy reform and BEC policy and have seemingly made no concrete advancements on that crucial front. Today’s newspapers print a headline in the business section about engine overhauls to meet BahMar

requirements, but this was not even worth a single line in the Mid-year statement! One wonders what is happening to the restructuring process and if we ever get a straight answer and action from this government on BEC or mortgage relief (also notable omitted from the Statement).

Fiscal performance

Mr. Speaker, it is rather difficult to make any comparisons year over year in this mid-year statement due to the many budget format changes made last June and the lack of detail in this statement. You will recall that we on this side, called for a restatement of the budget presentation but of course, we were ignored.

Be that as it may, the Government indicated that up to December 2014 it has achieved 38.9% of its revenue target. Mr. Speaker, while this does not give us tremendous concern given the timing of the revenue collections as indicated in the statement, it is worthwhile to note that many businesses and individuals stocked up on supplies prior to the January 1, 2015 VAT implementation date, and so it will bear watching to see what effect this may have on trade revenue and VAT in the early months of the year.

TAXES

VAT

Mr. Speaker, now that VAT is the law of the land, the government seems to be changing the reason for implementing VAT. At first the government came to the people, hat in hand promoting this tax as a way to restore fiscal balance with emphasis being placed on debt reduction.

In fact in the PM’s budget communication in 2014, Mr. Christie said VAT was designed to “secure the desired and necessary enhancement in the revenue yield of our revenue system”. Vat was supposed to be part of a mix of measures that would allow the government to alienate the “untenable structural imbalance between recurrent expenditure and revenue by the 2015/2016 fiscal year, to sharply reduce the GFS deficit by 2016/2017; and to arrest the growth in the government debt burden and move it onto a steady downward path to more sustainable levels”. All fancy words to mean reduce debt.

But in Mr. Christie 2015 New Year’s address, the fancy words changed. It was my interpretation that the tax was very skillfully linked to building infrastructure and capital works.

I call on this government to be accountable, transparent and honest; I call on this government to pass a Fiscal Responsibility Act so the Bahamian people can see exactly where their tax dollars are going. I call on this government to earmark through legislation a portion of VAT collected revenue to directly payoff outstanding loans thus reducing our debt. The people deserve to know the TRUTH about how their money is going to be spent.

VAT, or as Dr. Roopi puts it, that dirty Rat! has effectively reduced the buying power of the Bahamian dollar by 7.5 cents overnight and many Bahamian families are feeling the pinch.

Indeed just yesterday, while attending a track meet in Grand Bahama, I was challenged by a dialysis patient who wanted to know why she should have to pay VAT on her treatments, which are already expensive? Where is she to find this additional money with all of her other medical costs? Similar complaints have been lodged by other residents who argue that the cost of medicines have also increased because of VAT. An unhealthy situation I would say Mr. Speaker.

Additionally, I was surprised to learn yesterday that VAT is being charged at public health clinics. I was under the impression that like education, public health fees and services were exempt from VAT. What gives? Is public education and health exempt from VAT or not?

Many Bahamians have also complained that VAT is charged on, ATM withdrawals, cheque cashing at some banks, overdrawn accounts and any other “service fees”. Yet, we were told that financial services were exempt from VAT. Is financial services exempt or not? And don’t tell me that cashing a cheque or withdrawing funds is not a financial transaction, that’s just insulting. This application amounts to double or maybe even triple taxation because you pay VAT to cash your cheque, again to withdraw your money and then again when you pay for goods or services.

Many Bahamians are trying to do the right thing but VAT seems to penalize them for doing so. That’s NOT FAIR Mr. Speaker.

NHI

Mr. Speaker the government wants to implement NHI in January 2016 to give “health coverage” to all Bahamians. It was this promise that got the PLP elected in 2002 and it failed then. During the last Christie administration (2002 – 2007) it was estimated that NHI would cost 235 million which would be funded by way of a payroll tax. That was then, now the figure has almost doubled to get it effectively running today, that is according to a member of the NHI Commission. I want to caution the government that despite your political dream to get reelected at any cost, please be careful what you promise and weigh the cost of your promises because the Bahamian people are at this point being over taxed and will not be fooled again. Once bitten twice shy.

Accountability

Mr. Speaker, the Bahamian people want to know;

* How much has been spent on BAMSI, who burned the place down, was there insurance and when will someone be charged for that fire classified as arson.

* They want to know, how much has been spent on Junkanoo Carnival directly and indirectly through the Ministry of Tourism

* They want to know what is happening with the environmental levy fees.

* They want to know how much has been collected in real property tax arrears and what is the net amount accruing to the Bahamian people after debt collectors have been compensated.

* They want to know how much of the Bank of the Bahamas loans transferred to Resolve Bahamas has been collected and what is the net amount transferred back to the bank.

* They want to know, what is the status of UR 2.0 budget and Small Home Repairs. Are we getting value for money?

Mr. Speaker, I took special note of this particular line item in light of statements made by the co-chairs recently in the news about the effectiveness of the small home repair program as many of my constituents complain that they have yet to be assisted despite their applications and desperate need.

The co-chair proudly stated that over $2 million of the Bahamian people’s money had been spent on this program and that as a result, many contractors had been employed and the trickledown effect had been multiples of the investment.

Well Mr. Speaker, he is correct on two points, more than $2 million has been spent and there has been a trickledown effect BUT unfortunately, not in the way intended.

And it goes downhill from there Mr. Speaker. The examples of slackness and possible abuse of public funds is disturbing to say the least. I will leave it there for now Mr. Speaker by only saying; IF YOU HAVE NOT EARNED IT ….THEN RETURN IT!

STATE OF THE ECONOMY OF GRAND BAHAMA

Mr. Speaker, I represent a Grand Bahama constituency and so I must speak specifically for them. The economy for GBI remains disappointing and far removed from the “pie in the sky” and “bright lights of Vegas” images presented by the good Minister of Tourism since taking office. Yes Memories is here and the hotel is open, but the success of any economy is based mostly on how people’s finances have improved, and the people of Grand Bahama are still hurting; little to no improvements over the last two years and still no new casino operator as promised since 2012. Does it really take that long to sign a deal or was that all smoke and mirrors too, like the Silver Sands project, the new hospital, the new West Grand Bahama school and sports facility, the fishing hole road, the Smith’s Point seawall, et, etc, etc.

It is such a sad reality, when you reflect on these great promises and many others made during election time; who would have thought that Grand Bahama would still be in the economic state it’s in after the opening of a whole new Ministry, that is staffed from top to bottom, with a budget of over 9 million dollars.

Since coming to office however, thus far the Minister has only succeeded in leading the way to breaking down a Government building and preparing the land for sale, although I hear it done sell. Curious minds want to know, is it sold and if so to who? Still today with all the Campaign talks; WITH three of five MPs and two SENIOR MINISTERS, there is little to nothing to boast about in Grand Bahama.

The promise of providing quality new job within 100 days of taking office was a big joke when it was said and it’s still a big joke today, but nobody is laughing now. As we engage in this mid-term debate, Job Creation must be the number one priority for Grand Bahama and during your contributions; I hope the formula for Job Creation will be unveiled. The people of East G.B and the entire Bahamas will be listening.

Mr. Speaker, as you know I represent East Grand Bahama, humble people for the most part. We are blessed with some of the best behaved and intelligent children in the Bahamas.

Mr. Speaker, while I note reductions in spending at the Department of Education, I have in my hands a list of repairs that remain outstanding at our schools. Some of which I would classify as urgent as they are a threat to expensive electronic equipment and to the children themselves, as doors are literally hanging off the hinges in at least one classroom. Is this how we are balancing the budget, at the expense of children Mr. Speaker?

Mr. Speaker, I will share this list with the Minister of Education today with the hope that some form of immediate assistance will be forthcoming.

Similarly Mr. Speaker, we have an issue with health care in Grand Bahama generally and the eastern settlements continue to be at risk. Just this past week, I was reminded of two very serious incidents in these communities where utter confusion over emergency services almost led to the unnecessary harm to residents.

Just last night, in the execution of his duties, I am told one of our officers in McLean’s Town was severely injured leading to significant blood loss. Mr. Speaker the nurse has been out of office for a while now with no replacement, and so this young man had to be taken to Freeport buy private car. We pray for him Mr. Speaker and hope that he will have a full recovery. I repeat my call for necessary equipment for these citizens to help themselves.

Going further Mr. Speaker, I am told by my constituents that the service at the public hospital, has declined and that the wait for service is unacceptable. Up to 15 hours in one case from initial contact to final resolution of the problem presented. These are Bahamian citizens Mr. Speaker and we cannot balance the budget at the expense of our nation’s health.

Mr. Speaker, I noticed a modest lag in social services spending to date. I must say Mr. Speaker that I am surprised given the needs as mentioned earlier. Are we balancing the budget on the backs of the poor Mr. Speaker, the very ones this Government claims they care so much about?

Liberalization of Telecommunications

Mr. Speaker, for a short minute I want to comment on the liberalization of the telecommunications sector. Mr. Speaker, you know it is gratifying to see with the passage of time, that history proves you right.

Mr. Speaker, while the government talks about the liberalization, there had to be a starting point and we all remember the hue and cry over the bold and decisive steps taken by the former administration. The door was opened and I trust this Government proves to have done a better job than the former administration has in the context of time and experiences with the former privatization.

Mr. Speaker, the Government said that 51% of the Newco will be reserved for Bahamians. Those of us who are a little more skeptical of this government, wonders how exactly will this be done. The arrangement with the former administration, the FNM, called for 9% of that entity to be divested to the Bahamian public, with a further divestment in planned phases. Instead of following through with that plan however, this Government did exactly the

opposite and clawed back 2% economic interest (whatever that is), in what can only describe as a farcical exercise in mental gymnastics. This action is a direct contradiction to the stated intent of the liberalization exercise now underway.

Given the actions or, lack thereof on that divestment exercise, are we to trust this Government when they say they will cause 51% to be owned by Bahamians? I think not! I do not believe it is in their philosophy to see Bahamians have a significant equity stake in our country. They prefer the cradle to grave approach, keeping people dependent on them in exchange for votes.

If 51% is to be sold in the new company, I urge the government to make it a true IPO offering and that it does not attempt to act as an intermediary or interfere in the offering. They have no creditability in this regard. I also call on the Government to fully divest itself of BTC shares so that there can be no claim of insider trading and or unfair practices. How does an investor trust the regulator of a process to police that process, particularly when they have a vested interest?

This is only one instance where Government is actively engaged unfairly against private interest. I call upon the government to remove itself from all anti-competitive positions in the private sector and allow private entities to grow and shoulder more of the burden of building this nation economically.

Mr. Speaker, with the uncertainty in global economies, especially those for whom we are interlinked, again FISCAL PRUDENCE NOT WASTAGE must be the new Mantra of governance. I renew the call for the Government to fully enact in law, the Fiscal Responsibility Act, the office of Ombudsman, the National Economic Council and a Non Partisan “Ways & Means Council”, with the power to collaboratively determine budgetary spending. In such a way, hopefully partisan political influences will be lessened and full transparency will be possible.


Bookmark and Share




© Copyright 2015 by thebahamasweekly.com

Top of Page

Receive our Top Stories



Preview | Powered by CommandBlast

Bahamian Politics
Latest Headlines
DNA PR: It's time to change the system
DNA on Extension of Emergency Orders
DNA on shanty town demolition court order
DNA on new lockdowns on Family Islands
PLP Candidate for North Andros and The Berry Islands on Lockdowns in The Berry Islands and Andros