The budget communication was “a tale of epic failure”, Progressive Liberal Party Deputy Leader and Shadow Minister of Finance Chester Cooper said yesterday.
Minister of Finance Peter Turnquest presented the 2019/2020 budget yesterday in the House of Assembly.
“What we can categorically say about this latest budget is that the FNM’s (Free National Movement’s) strategy of taxing, borrowing and focusing on putting numbers over people has inflicted untold pain and suffering on the Bahamian people,” Cooper said at a press conference.
He said that despite the government’s focus on fiscal responsibility and deficit reduction, overall debt has increased as well as the debt-to-GDP ratio.
“This government, despite all its talk of old bills, borrowed like a drunken sailor, increased recurrent expenditure by $246 million, increased the debt-to-GDP ratio from 54.4 percent in 2016/2017 to 58.2 percent in 2018/2019 and the national debt increased to $8.2 billion,” he said.
Cooper added, “Further, in the face of the minister’s transparency soap box, we question how the minister will collect an average of $250 million per month in the last two months, when it only received an average of $190 million over the first 10 months.”
The government projected it would collect $2.6 billion in revenue for this budget year.
As of the end of April, Turnquest said roughly $1.9 billion had been collected and that revenue for the year is expected to be $2.4 billion, nine percent lower than what was budgeted.
He emphasized that due to lower than budgeted expenditure, the government is still on track to meet its deficit goal of 1.8 percent, as outlined in the Fiscal Responsibility Act.
Cooper, however, questioned whether the government will meet that goal.
“The minister of finance made great fanfare last year about the Fiscal Responsibility Act, but judging from today’s numbers, we will examine in due course whether this administration will violate its own requirements it foolishly built into legislation,” he said.
“Despite the pandering to the IMF, the government has still outspent its recurrent expenditure estimates.”
Cooper also highlighted the disparity between the percentage of last year’s value-added tax (VAT) increase and the increase in collected VAT revenue.
“The government believes that somehow its reckless course on the VAT increase will correct itself, when it is apparent the VAT increase has dampened economic growth,” he said.
“They increased VAT by 60 percent, but only collected 21 percent more VAT revenue.
“This budget is a tale of epic failure. The modeling and implementation was simply disastrous.
“Where are the prognosticators of a rebounded economy now that growth expectations have not been met?
“GDP growth of 1.6 percent fell significantly short of the touted 2.5 percent projection.
“With a robust U.S. economy that led to improved tourism numbers, a booming Baha Mar thanks to PLP policies, no hurricanes, increased borrowing and taxes, this administration still could not meet its growth projections.”
Cooper accused the FNM of prioritizing numbers over people.
“What about the people?” he asked.
“When will it be the people’s time?”
Education: Virginia in Charlottesville, BA in Foreign Affairs and Spanish