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Budgeting Beyond Waste: The PNM’s financial challenge

Today, when Finance Minister Colm Imbert unveils his budget, we will see whether the Dr Keith Rowley-led administration, too, is guilty of confusing the private sector with big business and big business with entrepreneurship.

Photo: Prime Minister Dr Keith Rowley.
Photo: Prime Minister Dr Keith Rowley.

If this government, too, is locked in the conventional economic paradigm, we might as well pucker up and get ready to kiss safe-sailing goodbye. The only antidote for the poisoned chalice of bloated government, which has been handed to the Rowley government, is a robust, self-sustainable community of small, medium and large businesses with the capacity to survive beyond state funding.

In the context of the PP government’s massive expansion of the role of the state in the economy, changing gears to restructure the economy could be very painful. All the indications are that business dependence on the state is at an all-time high.

Despite all the talk of economic restructuring, every sub-sector has become more addicted to state funds through subsidies, grants and contracts. The earnings from oil at US$100 boosted state revenue and financed government expansion.

For many in business, from big to small, government contracts are as solid as a lifetime guarantee even if it comes with no end of trouble in collecting government cheques.

Photo: Former Health Minister Dr Fuad Khan (right) shares a tender moment with UNC financier Ish Galbaransingh, who is wanted for corruption by the United States Government. (Courtesy Trinidad Guardian)
Photo: Former Health Minister Dr Fuad Khan (right) shares a tender moment with UNC financier Ish Galbaransingh, who is wanted for corruption by the United States Government.
(Courtesy Trinidad Guardian)

In recent years, we have witnessed the phenomenon of businesses created for the sole purpose of collecting state contracts. Any audit of state expenditure will turn them up.

With the contraction of government revenue, it is not only the student getting the GATE tuition subsidy or the mother getting a baby grant who could be affected by government cutbacks.

Big business caught in the government honeytrap is equally vulnerable.

The extent to which the Rowley administration can wean individuals and companies off subsidies, grants and state contracts will determine whether T&T will ride safely through the downturn or not.

In the late 1980s, the Robinson administration could not do it and, in the process, unleashed the forces of despair and destruction. It is now the turn of Rowley and his team to navigate hard times which, at this stage, is hardly as difficult as that which confronted the NAR.

Photo: Late Prime Minister Arthur NR Robinson (right) is greeted by then Cabinet colleague Basdeo Panday. (Courtesy Trinidad Guardian)
Photo: Late Prime Minister Arthur NR Robinson (right) is greeted by then Cabinet colleague Basdeo Panday.
(Courtesy Trinidad Guardian)

But, it could get there, depending on global economic conditions and its own ability to negotiate its way through competing interests.

PM Rowley has been at pains to assure us that there is a safe pair of hands on the ship of state. The sky is not falling in, he says, and there is no need to panic.

Even with oil prices in the US$40 range over a sustained period, he believes that his government can cut its cloth to suit. The first target is to trim the waste of public funds.

A safe guess is that he has seen the figures for the previous government’s budget for food and entertainment. It might not be identifiable from the budget, but one sector that should expect to take a big hit in tomorrow’s budget is Catering which gave literal expression to the PP’s wealth distribution mechanism so colourfully known as “eat ah food.”

The budget will also be the first test of the deal struck between the PNM and FITUN on the eve of the last general election. How are the unions going to respond to terminations, job rationalisation and lay-offs?

Photo: The Joint Trade Union Movement protests.
Photo: The Joint Trade Union Movement protests. 

For now, public attention is on contract workers with the Opposition vowing to go into action on behalf of them. Aware of the trap inherent in the PP’s stacking of ministries and state enterprises and agencies, the PNM is approaching the task with timidity.

What is needed here is a clear statement on how the government intends to proceed on this matter and, equally important, how it intends to prevent the institutionalising of jobs for the boys and girls by itself and all governments to come.

As in so much else, the Persad-Bissessar government turned a crack into an avalanche.

Governments have always abused the public sector recruitment process to make room for family, friends and supporters. But it took the Persad-Bissessar government to teach us just how dangerous it could be when legitimised as government policy.

The bold-faced appointment of unqualified party hacks, some of whom were downright dangerous to the effective functioning of public enterprises, reveals a lacuna in the government’s recruitment and appointment process.

Photo: Reshmi Ramnarine (far right) shares a drink with former Education Minister Dr Tim Gopeesingh. Ramnarine was controversially appointed as a Security Intelligence Agency (SIA) director in 2011. She subsequently resigned after media reports that her credentials were fraudulent.
Photo: Reshmi Ramnarine (far right) shares a drink with former Education Minister Dr Tim Gopeesingh.
Ramnarine was controversially appointed as a Security Intelligence Agency (SIA) director in 2011.
She subsequently resigned after media reports that her credentials were fraudulent.

For now, what is needed is a full human resource audit of contract employees and public sector vacancies with a view to aligning demand and supply of qualified staff and closing loopholes in the hiring process.

The public needs to have the full picture in precise detail. There are too many people, especially young graduates, who are on the sidelines of the job market, watching unqualified hacks occupying the positions for which they are trained.

As a people, we need to account for the Reshmi-isation of the public service in which anyone, regardless of competence, could be appointed to any job because someone has the power of appointment without the responsibility to account to us.

So, yes, as he goes through the accounts, Minister Imbert will likely find a lot of waste that could be trimmed in protecting the bottom line. But that will only go so far.

Photo: Minister of Finance Colm Imbert. (Courtesy Power102)
Photo: Minister of Finance Colm Imbert.
(Courtesy Power102)

Beyond that comes the real reckoning of fundamental transformation of the structure of the economy. And, given the vested interests involved, that will be the hardest challenge of all.

AboutSunity Maharaj

Sunity Maharaj
Sunity Maharaj is a journalist with 38 years of experience and the managing director of the Lloyd Best Institute of the West Indies. She is a former Trinidad Express editor in chief and TV6 head of news.

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2 comments

  1. Hear nah, I nearly dead! LOL

    “A safe guess is that he has seen the figures for the previous government’s budget for food and entertainment. It might not be identifiable from the budget, but one sector that should expect to take a big hit in tomorrow’s budget is Catering which gave literal expression to the PP’s wealth distribution mechanism so colourfully known as “eat ah food.”

  2. Hopefully with review and implementation of proper procurement there would soon be an end to the contractor who, through divine intervention, opens up just in time to benefit from state contracts at the expense of moree established/experienced contractors. As for food bill, i recall when President Hassanali was in office he saved money by not serving alcohol. I recall reading somewhere the office of a top office holder owed a huge sum of money to a grocery. We need to review those figures. As for recruiting process whthe public servants stand since they are the gatekeepers to the gov’t purse. Wise counsel to tread cautiously as a previous minister terminated a number of persons and many of them got compensation at court.