Last of the big spenders
Can the Government continue this pattern of deficit budgeting? It has no idea when gas prices will recover.
The Government has started to spend more than it expects to earn.
And unless there is an early recovery in the prices of gas, petrochemicals and iron and steel on the international market the country could be heading towards queer street.
That is the assessment of observers on the deficit $44.3 billion budget which an upbeat Finance Minister Karen Nunez-Tesheira presented to the House of Representatives yesterday afternoon.
Citizens will have to partly fund this deficit by paying increased property taxes and more for alcohol, cigarettes and for driving permits.
However, the $7 billion deficit will be mostly funded mainly by borrowing. One must ask: how long can the Government keep this up this pattern of expenditure exceeding revenue? Last year, the Government budgeted for revenue of $51 billion but there was an actual $15 billion shortfall.
In a wide ranging three hour and ten minutes presentation, the Finance Minister boasted about the Government’s achievements this year which included the opening of the overpass at the intersection of the Uriah Butler and Churchill Roosevelt Highways, the Port of Spain to San Fernando ferry service which transports some 2,500 passengers daily.
She also outlined fiscal measures for improved pension benefits for public servants and parliamentarians; crime fighting measures; having the Trinidad and Tobago Revenue Authority operational next year; the construction of a national aquatic centre and a tennis centre and the upgrading of sports facilities; the completion of 50 Early Childhood Centres and the start of construction of 50 more ; the construction of 18 primary schools; the completion of 8,000 housing units and the startup of 2,000 more next year.
The European contractor, Vinci, which built the overpass will build one at the Aranguez intersection of the Churchill Roosevelt Highway and there are plans for the continuation of the ferry service to Point Fortin and to Cocorite and highway development at Wallerfield; from San Fernando to Point Fortin and to Mayaro.
A lot of what she outlined have been rehashed measures outlined in previous budgets and one gets the distinct impression that the Government feels that it can achieve in one year what would normally be accomplished in ten. The fact is, the Government has all its revenue generating eggs in one basket and will have to pray that there will be recovery in commodity prices in the next couple of years. It has no say in the matter and one wonders whether it should not be trying to diversify from oil and gas, petrochemical products and the sunset industries of iron and steel and aluminum.
The Budget Debate will begin at 10a.m. on Friday.