In light of Finance Minister, Winston Jordan’s announcement that Budget 2019 will be yet another early presentation, General Secretary of the People’s Progressive Party (PPP), Dr Bharrat Jagdeo is of the opinion that the APNU-AFC Government is still disregarding technical problems associated with this tactic and have not learned from their past mistakes.
According to the Opposition Leader, Jordan’s adamancy in ensuring that next year’s Budget Presentation is done ahead of the Local Government Elections (LGE) – which is slated for November 12 2018- may be a scheme to influence same.
“I thought that maybe they are trying to catch the Local Government Elections; to present a budget with a few goodies to influence people on how they vote. That is still very likely, knowing how this Government operates. It makes a lot of promises and has a poor track record of fulfilling those promises,” he said.
Nevertheless, the PPP member maintained that there are several major disadvantages to presenting early budgets.
“The issue is: when you go to the Parliament, you go to debate the framework, and the country expects a discussion on the economic performance in the current year; and based on that performance you will move forward. This is not what we are getting,” Jagdeo posited.
He further contended that presenting an early budget means that the numbers included, are not final year numbers but more numbers related to growth by sector, among others things.
He made reference to the previous budgets presented under the Coalition Government, stating that they had undergone several revisions of the growth rate — in some cases four times — because the final figure was much lower than the projection made.
In 2017, the Government initially projected that Guyana’s economy would have grown by a 3.8 per cent growth rate for 2017.
This projection was reduced to 3.1 per cent. It was then revised downwards again to 2.9 per cent. The actual performance of 2.1 per cent, was disclosed only earlier this year.
Jagdeo, a former Finance Minister and President, said the fiscal deficit also varied substantially when the actual numbers were presented.
He asserted that if one were to compare the components of the fiscal deficit, they would observe a massive change in current and capital expenditures, as well as revenue.
“We had false figures on revenue and expenditure, therefore the fiscal deficit numbers were false. The numbers were patently false figures,” he said, while adding that on the external side, the balance of payments’ numbers also changed massively.
The PPP GS also recalled that when the actual outcome was seen, it was worse by US$200 million and according to him, this could be a recurring problem.
Jagdeo noted that the balance of trade was also distorted.
To this end, he is maintaining that if Jordan, and by extent, the Government, is serious about presenting budgets that would have some impact and meaning, then they should wait until January so that they can have actual numbers to work with.
“We have a Minister who says nothing about the concerns that have been raised. What we will have is another debate on numbers that look great, but in a month, when the actual numbers are available for the year end, we will see a totally different picture,” he reasoned.
In the past, Jagdeo has been recorded asserting that an early budget puts his party members at a major disadvantage when debating the financial expenditures of the Government in the National Assembly.
The former Junior Finance Minister, Juan Edghill, has also maintained that Government’s early budget was a means of evading public scrutiny, and a means by which to hide their underperformance.
Edghill maintained there was no haste for an early budget presentation, noting that, historically, the country’s budget was presented in the first quarter of the fiscal year.
Government recently admitted that despite some slight improvement in the Public Sector Investment Projects (PSIPs), “tremendous” challenges continue to be faced, particularly with foreign-financed projects.
Jordan has said it is not where he wants it to be.
Compiled annually, the PSIP contains capital investment projects funded under the domestic capital budget, and projects financed through external aid.
In February this year, a critical analysis of PSIPs between 2014 and mid-2017 revealed that the performances of many projects left much to be desired.