thebahamasweekly.com - Turnquest: The Prime Minister’s Reckless Spending Habits

From:TheBahamasWeekly.com

Bahamian Politics
Turnquest: The Prime Minister’s Reckless Spending Habits
By The Free National Movement
Mar 10, 2017 - 4:57:52 PM

Nassau, Bahamas - K. Peter Turnquest’s, Deputy Leader of the Free National Movement (FNM) and MP for East Grand Bahama, statement:

“We all know of the infamous Roman Emperor Nero, who fiddled while Rome burned. In fact, our esteem Prime Minister Perry Christie has often been compared to him. For historical accuracy, and in fairness to Nero, we must compare Prime Minister Christie to Nero’s uncle, the Roman Emperor Caligula, for history records him as being worst then Nero.

“Caligula’s reckless spending threw the Roman Empireinto a financial crisis. Hence, the comparison to Caligula, as The Bahamas has been downgraded four timesin five yearsand is now at Non-Investor Grade Status (Junk) according to the world’s largest credit rating agency, S&P, under the watch of Perry Christie.

“In reviewing the various tables in the Central Bank’s Statistical Digest for February 2016, and Central Bank’s Statistical Digest for February 2017 Caligula Christie is at work, and thank goodness his reign is coming to an end.

“The mentioned reports tell a story no different from that of Caligula Christie’s natural disaster spending. Yes, the GFS Deficit (Tables 5.1 and 5.2 Central Government: Operations and Financing) was $314.425 million as of December 31, 2016 due to the government spending about half the approved budget appropriation and revenues being only 39.3% of projections at the half way mark.

“But, disaster spending is far from what happened in the second quarter of 2016/2017 as (Tables 5.3 and 5.4 Central Government: Expenditure by Economic Classification, and Tables 5.5 and 5.6 Central Government: Expenditure by Functional Classification), paints a different picture, as Current Expenditure was in line with expenditure in third and fourth Quarters of 2015/2016, and we spent less on Public Works in Quarter 2 - 2016/2017, $34.399 million, than we spent in Quarter 1 2016/2017, $39.809 million. The lion share of the $95.859 million in capital spending during the second Quarter of 2016/2017 went to fixing up government buildings as usual; no doubt Caligula Christie has an explanation. Yet another troubling reason to remove Caligula Christie.

“The increase in transfer payments & subsidies were initially highlighted in the June 2016 Central Bank Monthly Economic and Financial Development report. We have repeatedlydemanded that Caligula Christie privatize state owned assets. We note that since 2011/2012 expenditure in the form of transfer payments & subsidies, $398.7 million, had increased by $375.3 million to $774.1 million at the end of 2015/2016. This had led to warnings from local analysts Anthony Ferguson and Kenwood Kerr in August 2016, and recently by Moody’s in its quarterly country report. The FNM has implored Caligula Christie since 2012 to continue the policy of selling government assets to Bahamians and private enterprises to mitigate the strain on government resources. With this said, we call on the Government to make public the details of the bids in BEC’s request for proposals, and of its 2% buy back of BTC shares.

“Now, let us turn to concerns about special purpose vehicles which Caligula Christie loves. Imagine my shock when I learnt from the Central Bank’s Statistical Digest that not only had the Government created Bahamas Resolve Limited with its $100 million in debt, without Parliament’s approval, it had created Poinciana SPV Ltd and its $14 million debt. No doubt, Caligula Christie did this for another set of friends, family and lovers.

“Caligula Christie continues to make one fundamental mistake; it is with his optimistic revenue forecasting. Revenues and Grants are projected to be in around $2.2 billion for 2016/2017. Preliminary estimates at the end of December 2016 have revenues at $851.8 million or 39.3% of projected at the halfway mark. When we look back at budget revenue performance in 3rdQuarters of 2014/2015, $488.470 million, & 2015/2016, $501.213 million, and the 4thQuarters of 2014/2015 $527.141 million, & 2015/2016, $532.136 million, we lack Caligula Christie’s optimism. Note, we looked at these quarters because VAT was introduced in January 2015; therefore, the quarters are a better representation of how revenues will perform. And so, in order to achieve the revenue forecast we need at least a 10% better improvement over the preliminary revenue performance in the second half of 2015/2016.

“With that said, we are prayerful that Caligula Christie will not spend, in a vain attempt to convince voters to let him remain in office. As the revenue scenario outlined above, looking at the historical numbers for expenditure, speak to why Caligula Christie political life and his Administration must come to an end.

“Focusing further on government revenue, (Table 6.2 Central Government: Treasury Bills, and Table 6.3 Central Government: Long-term Securities) and mindful of the recent events in Barbados, we need more details from both the Government and the Central Bank on the increase in the Central Bank’s T-Bills holding since 2012 and specifically the $97.6 million increase in 2016.

“The FNM is eager to begin tackling this crisis created by Caligula Christie in order to truly offer‘help and hope’ to our people for the era of ‘friends and family’ has run its course. It is now the people’s time.”