The National Assembly late Friday night passed the People’s Progressive Party/Civic’s $330 billion Emergency Budget for the remainder of the 2020 Fiscal year.
This was done following a week-long consideration of estimates in the Committee of Supply. On September 9, Public Workers Minister Juan Edghill presented the PPP/C’s first budget of the 12th Parliament, on which the Members of Parliament from both sides presented their debates last week.
Minister Edghill on Friday night lauded the staff of the Finance Ministry for their commitment to preparing the Budget in just 29 days after the new government took office on August 2, 2020. He noted that they worked beyond the call of duty without any complaints.
While defending the allocations for the Finance Ministry, Edghill was asked about salary increases for public servants and in response noted that while this is not included in the Budget 2020, it is not something that has been ruled out.
“I would like to assure the Honourable Members of this House that, even in the midst of underperformance in the economy, mismanagement, maladministration, and spending without due recourse, the PPP/C will at all times, at the appropriate time, consider whatever is workable even in the COVID pandemic environment to do what is good for public servants,” the Minister said.
Nevertheless, of the $330 billion being presented, $51.7 billion, representing 15 per cent of the total budget, will be going to health. This includes $14.3 billion for the procurement of drugs and medical supplies.
In the field of education, $52 billion has been set aside, including $1.7 billion for construction and rehabilitation of schools. A further $3 billion has been set aside for housing and $2 billion for the Guyana Water Incorporated.
In addition, $34.4 billion has been allocated to go to the Public Works Ministry, where work will be done on a number of projects, including the Ogle Bypass Road and the East Coast Railway Embankment Road.
The Ogle Bypass Road, according to Edghill will be worked on as quickly as possible. He noted that the project, funded by the Indian Export-Import (EXIM) Bank, is at the agreement stage.
Members of the Joint Services will also be receiving a two-week tax-free bonus. This, therefore, means that the Guyana Police Force (GPF), the Guyana Fire Service and the Guyana Prison Service will benefit.
The Joint Services previously received a one-month tax-free bonus implemented by the former People’s Progressive Party (PPP) Government, until the measure was discontinued by the former A Partnership for National Unity/Alliance For Change (APNU/AFC) Government back in 2015.
In Budget 2020 there are provisions for a $25,000 cash per household distribution drive as a relief package in light of the COVID-19 pandemic.
In addition, the old-age pension will be increased to $25,000 per month and pensioners will receive free water, with the overall removal of Value Added Tax (VAT) on electricity and water. It was announced that VAT would also be removed from all medical supplies, not just those related to treating COVID-19 and its symptoms, or even for Personal Protective Equipment (PPE). VAT will also be removed from hinterland travel and cell phones, as well as building and construction materials. The Government will also be removing corporate tax on private education and healthcare, a measure likely to bring the service costs down.
As part of the budget measures, $800 million had been set aside for the Amerindian Development Fund. This will provide funding to support the socio-economic development of Indigenous communities and villages, through the implementation of Community Development Plans (CDPs) the Indigenous communities themselves picked.
When it comes to school children, the Government will also be implementing, effective from January 1, 2021, a $15,000 cash grant for children and a further $4000 uniform voucher allowance.
VAT has been removed from all exports, as well as machines and equipment. Additionally, duties have been reversed on machines and equipment while tax concessions will be granted for persons operating in the mining, agriculture and forestry sectors.
Persons looking to purchase a used vehicle are also catered for since the Government will be reversing the ban on the importation of vehicles older than eight years that was introduced by the former APNU/AFC Government back in 2016.
Questions have been raised about how the PPP Government is sourcing the money for such a large budget, considering the fact that the country has been in a prolonged political standoff since 2018, after the passage of a No-Confidence Motion against the former Government.
In addition, the last time a budget was passed was in November 2018. But Vice President Bharrat Jagdeo had explained that the monies comprise funds the Government borrowed, as well as rollover sums.