Private Sector Commission (PSC) Chairman, Captain Gerry Gouveia has described the performance targets outlined in the 2009 budget as “ambitious” and that the annual presentation had been shaped with the intention to restrain the financing deficit.
He stopped short of proffering “a “comprehensive private sector review” of the budget. “As a private citizen there are some things that occur to me immediately. However, as far as the private sector is concerned there would have to be deliberations by the stakeholders before we can provide an informed response, Gouveia said. Asked about a time line for a private sector response the PSC Chairman said that a meeting to discuss the budget could take place before the end of this week. Meanwhile, Gouveia said that it was his view that the performance targets outlined in the budget were “good benchmarks” to aim for. “What I have observed however is that the realization of those targets depends heavily on the performance of the sugar industry which is facing serious challenges at this time.”
According to Gouveia an objective analysis of the budget must take account of “the global economic situation” which he believed helped to inform its conceptualization. Gouveia told Stabroek Business that his “reading” of the budget was that it was prepared against the backdrop of government’s preoccupation with “a significant budget deficit.” “While I believe that some analysts may seek to make a case for more public spending in social services, raising of the income tax threshold and addressing issues of tax reform and while some of that analysis may appear entirely justifiable, one of the top priorities in this year’s budget was, clearly, to harness the deficit.” Gouveia said that while he noted that considerable sums of money have been earmarked for infrastructural works, he “wondered” about the inclusion of a new airstrip at Wakenaam. “While I am not suggesting that we ignore the building of communication links across our country I wonder about this development in the context of the various difficult spending choices that confront us at this particular time.” Asked about the likely impact of the budget on the tourism sector, Gouveia who heads Roraima Airways, said that while he had found “nothing of real significance” in the budget that might stimulate the sector he was “not particularly surprised” over this development.” Meanwhile, according to Gouveia government would still need to tackle the issue of tax reform as a matter of urgency if some measure of economic growth is to be stimulated. “In my view tax reform is one of the single most important issues that have to be dealt with if economic growth is to be generated. High taxation is a serious deterrent to economic growth.” And Gouveia disclosed that a team of overseas consultants had recently completed a study on tax reform under the aegis of the Millennium Challenge Corporation which would help inform public/private sector consultations on tax reform. He said that the document had already been studied by government and that a “selected private sector panel” was presently considering its contents. He said that the document had taken account of “the strong views of the private sector on tax reform” and that the PSC was generally pleased with it. Asked whether the private sector expected to see significant movement on tax reform this year Gouveia said that while the PSC was hoping that that would be the case “we are aware that the consultations are still to happen and that these must happen before tax reform materializes. My thinking is that that consultation process should happen in the next few months,” Gouveia added.