Opposition Leader, Tobias Clement, Monday dismissed the EC$1.3 billion (One EC dollar=US$0.37 cents) budget presented to the Parliament last week as being “highly deceptive” and predicted that it will be unable to meet the current fiscal and social challenges facing Grenada.
Finance, Economic Development, Physical Development, and Energy Minister, Gregory Bowen, in pr4esenting the 2022 budget strategy last Friday, said it aimed to address the challenges created by the coronavirus (COVID-19) pandemic and provides for total expenditure, including amortization, of EC$1.35 billion with recurrent revenue pegged at EC$722.2 million and current expenditure estimated at EC$661.7 million.
Bowen said that with a deficit projected for 2022, the government will need EC$98 million more financing than what it expects to generate from domestic revenues and grants, to meet all of its obligations.
But Clement, in his rebuttal to the fiscal package, said the presentation by the government lacked implementation “and it means, therefore, you have failed” asking the government to indicate how it is going to finance the budget deficit.
“What I see today is the presentation of a document that is cut and paste…The number changes a little bite to fit inflation, but it is the same template from since 1995,” said Clement
“If we have to go somewhere in this country we have to innovate. If you look at the presentation of the budget, you will see a look of nice things in there, anybody could put anything in the budget but like I always say, the proof of the pudding is in the eating…the proof of the budget is in the implementation,” he added.
“I will call it a Santa Claus budget that is highly deceptive in its presentation as it is,” said Clement who is of the view that the financial affairs of government are out of order and ‘must be put in order for the sake of the country’.”
During his presentation, Clement urged the government to re-consider options to stir economic activity here.
“It means therefore that the government is not working because what should have been done to stir economic activity in the country was not done,” he said, recalling last year he had urged the Keith Mitchell administration to seriously consider a coronavirus (COVID-19) stimulus package to be included in this year’s fiscal package.
“Let me at this point in time thank the government for coming back to Parliament and passing the stimulus package in 2021. But Mr Speaker I hasten to say when I look at this year’s budget documents there’s EC$9.2 million allocated for COVID related business for 2022.
“Mr Speaker sad to say that I do not believe that COVID is not with us as yet,” he said, noting that just last week, a new variant of the pandemic had been detected “so let us not rest and think we are out of the woods.
‘It means Mr Speaker that we, may have to return again to some form of stimulus for COVID…and I hope the powers that be are listening,” he said, indicating that he wanted to make some recommendations for consideration by the government.
Last week, the Finance Minister said that the government would be removing the Environmental Levy (EVL) for certain consumers of electricity, whose usage does not exceed 500 kWh.
“In other words, Mr Speaker, domestic customers consuming up to a maximum of 500 kWh per month, will be relieved of government charges on their electricity bills.”
Bowen said, additionally, with the rise in the price of fuel expected to continue, a reduction of 25 per cent on the non-fuel charge per KWh, will be instituted for all categories of consumers and that these changes will take effect in the next billing cycle.
The Finance Minister said this would not have been possible, had the government not moved to acquire ownership of GRENLEC, the sole electricity supplier on the island.
In December last year, the US-based WRB Enterprises (WRB) and Grenada Private Power Limited (GPP) announced it had executed a Settlement Agreement with the Grenada government agreeing to transfer their majority stake in GRENLEC to the government in exchange for the payment of US $63 million, thereby making the government the majority shareholder.
But Clement said that the government should now go further and consider offering shares in the utility company to ordinary Grenadians.
“I would ask the government before the election is called next year or the year after…make sure we diverse the shares of GRENLEC to the Grenadian people. I too may want to own a couple of shares,” he added.
“Mr Speaker, God Forbid, as the elections turn on a dime, just perhaps GRENLEC might end up back in the hands of WRB,” he said, adding “it would be a very sad thing in Grenada”