Labour and the budget

Labour

The Government of Guyana and its various supporters, notably those in the private sector, have heralded the 2011   National Budget as the largest in the country’s history. The trade union movement, built on the principle of the creation of a just society, sees any budget within the context of creating jobs which, of course, is premised on honouring the right to work, consistent with Article 38 of the Constitution which speaks to the “duty of the state, trade unions …and the people…to achieve the highest possible levels of production and to develop the economy in order to ensure the realization of rights.”

Lincoln Lewis

As the nation grapples with poverty the trade union movement remains convinced that the principal pursuit in the march towards poverty reduction ought to be the creation of jobs.

Job creation is not the responsibility of the private sector. Business, by its very nature, is driven by profit. This is not to say that profit is bad but it serves to reinforce the point of the misunderstanding between a profit- driven focus and an employment – driven one, the latter being the principal responsibility of government.

As the custodian of the nation’s Constitution in which is enshrined the right to work as fundamental to individual and national, well-being, it is the government’s responsibility to ensure that people are employed. Unemployment exacerbates poverty; and poverty hinders longevity and undermines personal and national growth. Poverty also brings with it other concomitant social ills including prostitution, drug use and abuse and, of course, crime.

Given these realities one wonders why the government, year after year, declines to embark on meaningful initiatives designed to create jobs, preferring to boast of remittances, to use remittances and taxes including the Value Added Tax (VAT) as indicators of how well the country’s economy is performing.

Any budget worth its salt would place human resource development at its centre, since development is about people.

Assembled for the budget debate

As such the budget’s failure to take account of the various critical sections of the population – the underemployed, employed, employable, unemployed, those currently at school who will shortly be absorbed into the job market, and the retired – is testimony to misguided and counterproductive policies. What the 2011 budget has manifestly failed to do is to articulate policies aimed directly at improving the livelihoods of the aforementioned sections of the population. Failure to address these concerns points to a serious deficiency in conceptualizing and understanding its own responsibilities.

Whichever political party forms the government, that party must assume responsibility for providing a quality of governance that is consistent with the requirements of the constitution.

This, by definition, includes ensuring the productive utilization of all the citizens in an environment that is just and fair. It therefore makes for both good politics and good governance to adhere to principles that are concerned with people’s development. The 2011 budget has fallen short of meeting these expectations.

What the political administration appears to favour is a ‘tossing around’ of numbers that bear little if any relevance to the concerns of many ordinary Guyanese. Bragging about ‘the largest budget’ means nothing to the ordinary worker, unemployed, or retired, whose financial circumstances are unlikely to be enhanced by the provisions of the budget.

The hoots and hand – clapping in the National Assembly that followed the announcements that old age pensions and public assistance are increased from $6600 to $7500 and $4900 to $5500 per month, respectively, and that the income tax threshold is now $40,000 ignores the fact that these miniscule adjustments will make no real difference to the liquidity of the ‘beneficiaries’ since these are likely to swallowed up swiftly by rising prices.
The tax regime as presently constituted has made wage-earners the nation’s beasts of burden.

Little wonder that even some private sector functionaries have expressed the view that a point has now been reached where serious consideration should be given to abolishing income tax for wage earners. Surely, the government’s takings from VAT are more than enough to compensate for the removal of the tax burden from around the necks of people who, even now, find it difficult to make ends meet.

The issue before us is not one of an adjusted tax threshold, but a focus on addressing real wages. Real wages are  reflected in purchasing power, that is, whether available income is sufficient to meet one’s material needs. That is the issue that the administration must face.