Budget 2014 a `huge disappointment’ – Ram and McRae

In their detailed annual review, accounting firm Ram and McRae says the 2014 budget is a “huge disappointment” and contends that at least one of its provisions makes it “dead on arrival”.

20140331amaila falls logoIn a 12-page edited version of the Budget Focus in today’s Stabroek News, Ram and McRae says the budget seems to contain only a shopping list for Expenditure while offering nothing on employment creation and the critical issues of corruption and better public sector financial management.

“Indeed, there is growing evidence that the country’s financial management is under serious threat, despite regular warnings. Despite the usual grandiloquence there is no real evidence of a central theme or the direction in which the Government proposes to take the country”, the chartered accounting firm said in its conclusion.

It charged that the budget placed very little attention on job creation and none on the National Insurance Scheme (NIS), which it says is still reeling from the loss of monies in the CLICO collapse.

“Dr. Ashni Singh is not only the Minister responsible for the NIS but was also the Minister responsible for CLICO’s oversight when it collapsed. It is all the more troubling that there is such little interest in what is an equally badly executed liquidation”, Ram and McRae said.

Noting that little was said about the Amaila Falls Hydropower Project and how the need for low-cost energy will be met, the accounting firm said that concerns that there may be moves to restore the project cannot be discounted even as the Government announced a study into the feasibility of hydropower from Mazaruni.

“Indeed Ram & McRae finds it hard to understand the $16,000 million allocated for equity contribution to the Amaila Falls Hydropower Project. We believe that item alone makes this Budget incapable of approval, or in common parlance, dead on arrival”, the budget review said.

Ram and McRae contended that Singh’s presentation was  a budget driven by subsidies and handouts with the Guyana Sugar Corporation (GuySuCo) and Guyana Power and Light, Inc. (GPL) continuing as major beneficiaries even though the Government is resisting a review of their operations. The accounting firm says it  seems irresponsible for GuySuCo to be provided further budgetary support until it complies with the law relating to the presentation of annual accounts and reports.

Ram and McRae also reviewed the controversial decisions by the Court in  the “Budget Cuts Case”.

“We believe that the court fell into error and therefore welcome the decision by the Speaker to appeal the decision of the one-man constitutional court. The National Assembly now proceeds to have the Estimates examined by the Committee of Supply which the court stripped of any real purpose and function, prompting one seasoned commentator to describe the process as “high farce””, the budget review said.

It added that the National Assembly has been stymied in its work by the Executive and the President who “appears to treat the opposition as an obstacle rather than a partner in progress”.

The review said if there is no progress on settling the impasse over the Anti-Money Laundering and Countering the Financing of Terrorism amendments, all the projects by the Minister of Finance could be placed in jeopardy. “We therefore join in appealing to everyone to put Guyana first”, the review said.

“Ram & McRae predicts that the Government will have a difficult time to persuade the parliamentary opposition to support certain budgetary allocations for projects and initiatives that appear to have received inadequate planning; or to allow the spending on NCN from which so much of the country is shut out; or to finance some of the government’s pet projects.

“There is a belief that the PPP/C is unwilling to function without a clear majority which would allow it to have its unhindered way in the Assembly. Cynics might even suggest that the 2014 Budget was designed to invite a rejection of the Budget and justify returning to the polls and forestalling long delayed and much feared local government elections”, Ram and McRae asserted.

 

 



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