Showdown looms over budget…-Ramjattan moves to cut $3.8B in spending

-gov’t warns it would cost jobs

AFC MP Khemraj Ramjattan has proposed budget reductions of $3.824 billion from programmes under three ministries, sparking the ire of the ministers yesterday at a hastily called press conference in Parliament.

The Committee of Supply of the National Assembly today begins examination of the estimates of government spending for this year and the opposition could use its one-seat majority to effect cuts.

A notice of a Motion in Ramjattan’s name, which was circulated in the National Assembly last evening, calls for amendments to be moved in the Committee of Supply to reduce allocations for expenditure under the Ministry of Tourism, Industry and Commerce, the Ministry of Housing, and the Ministry of Culture, Youth and Sport.

From left, Minister Irfaan Ali, Minister of Culture, Youth and Sport Dr Frank Anthony and Public Service Minister Dr Jennifer Westford at a press conference on the proposed AFC budget cuts. (GINA photo)

If Ramjattan’s motion is passed, the reductions would see the allocations for “contract employees” in all three ministries almost halved and government ministers last evening said it would result in job cuts.

Signalling his intention, Ramjattan also wrote Finance Minister Dr. Ashni Singh requesting details on the compensation packages paid to the top 25 contract employees in a number of budget agencies, statement on balances with respect to the National Industrial & Commercial Investments Ltd (NICIL) and Lotto Funds, among others, and details regarding the subsidies amounting to $10 billion for GuySuCo and GPL.

Under the Ministry of Tourism, Industry and Commerce, reductions in budget allocations are proposed by Ramjattan for the Guyana National Bureau of Standards (from $119M to $62M), the Guyana International Conference Centre ($12M to $3M), Tourism Development ($5.3M to $3M), Land Transport ($4.75M to $3M), the Competition and Consumer Protection Commission ($91M to $31M), the Competitiveness Programme ($235M to $220M), and Industrial Development ($50M to $25M), among others.

Under the Ministry of Housing, he has proposed reductions in allocations for the Community Roads Improvement Project (from $1.4B to $905M), Infrastructure Development and Building Programme ($1.9B to $990M), the Coastal Water Supply ($900M to $450M) and the Georgetown Sanitary Improvement Project ($503 to $353M). Also, under the Ministry of Youth, Sport and Culture, targeted for reductions is the National Sports Commission (from $451M to $200M), among others items.

Irresponsible

At an emergency press briefing called last evening, government members said Ramjattan’s motion was an irresponsible move that threatens the livelihood of hundreds of Guyanese.

Housing Minister Irfaan Ali, who also has responsibility for the Tourism sector, Sport Minister Dr Frank Anthony and Public Service Minister Dr Jennifer Westford addressed the media and said that the proposed amendments would render hundreds of contracted employees in the three ministries jobless and hinder the wider development plan for the nation.

For the Ministry of Tourism, Ramjattan has proposed the allocation for contract employees be reduced to $27M, from the $47.3M proposed by Finance Minister Dr Ashni Singh in the budget. Similarly, for the Ministry of Housing and Water, Ramjattan is calling for the $33.6M originally budgeted to be reduced to $18.6M, while in the Ministry of Culture, Youth and Sport, he is seeking for a reduction in allocations for contract employees in three categories; from the $62.4M originally budgeted to be reduced to $27M; from $88.5M to $59M; and from $111.5M to $76M.

The opposition parties have routinely argued that employing contract employees is a method used by the PPP/C administration to pay favoured individuals super salaries. The government has repeatedly denied this.

Anthony said that the proposed deductions would be a fatal wound to his ministry’s budget. “This is a fatal wound to our allocations… they want to kill the Ministry,” Anthony declared. He said that should the motion be passed, several of the ministry’s key infrastructural projects, such as the Synthetic Athletic Track at Leonora and the warm-up pool at the National Aquatic Centre, would not be completed.

Anthony said that Ramjattan’s motion was a contradiction to what the party and the opposition on the whole had argued about creating more jobs and developing in youth. “This is really, really a sad day in our country,” he added.

Meanwhile, Westford said that the government will stand by its contracted workers.  “We are not going to succumb to this, even if it means the government is going to have to subsidise them,” she added. According to her, it is not only professionals that would be impacted but cleaners, handymen and other vulnerable citizens. “We will have to stand with these workers,” she declared, while expressing hope that “better sense prevails” on the part of the AFC.

Meanwhile, Ali said that if the allocations to the Tourism and Housing ministries are indeed reduced, several key government programmes cannot be implemented. He said that it was strange that Ramjattan would propose to reduce the budget of the Tourism sector when the AFC MP Cathy Hughes had spoken in her presentation about the need to invest more in this sector.

Requests

Meanwhile, in a letter to Singh, dated April 12, 2012, Ramjattan’s requested the contract employment details for the Office of the President, the Ministry of Finance, the Guyana Elections Commission, the Ministry of Amerindian Affairs, the Ministry of Agriculture, and the Ministry of Culture, Youth and Sport.

The agencies for which the AFC wants statements of balances as at December 2011 are the Bank of Guyana, the Guyana Forestry Commission, the Guyana Geology and Mines Commission, the Guyana National Cooperative Bank Debt Collection Unit, the Lotto Fund and government money not in the Consolidated Fund. The AFC also wants financial details on the subsidies to the Guyana Sugar Corporation and the Guyana Power and Light Company.

“Can you also provide us with a copy of the request by GuySuCo and the Guyana Power and Light showing their proposals to restore their corporations to viability and more particularly how they propose utilising the proposed subsidies?” he questioned.

The 2012 budget makes provision for GuySuCo and GPL to receive subsidies of $4 billion and $6 billion, respectively.

In the letter, Ramjattan also called for the government to provide particulars of all tax waivers, concessions and duties by sector and/or products during 2010 and 2011 and the revenue collected by each of the respective economic sectors, including sugar, rice, bauxite, forestry, fisheries among others.

Further, Ramjattan, on behalf of the AFC, wrote Budget Director in the Ministry of Finance Sonya Roopnauth seeking clarification on the projects financed by loans as against being financed by grants. “As you are aware, deliberations on Budget 2012 move to the stage of detailed consideration of the estimates early next week,” Ramjattan wrote on April 12, 2012.

“In preparation for that exercise, we, Parliamentarians of the AFC, have been examining the three volumes of the Estimates, including Volume 3 ‘Central Government Development Programme Capital project profiles’ and note that the projects are broadly and vaguely described, rendering impossible an understanding of the budgeted amounts for the various elements of the project,” Ramjattan said.

“We also note that item 9.7 of the Capital Project Profiles is described as Amounts to be financed by Foreign Loans/Grants,” he said. “In order for us to participate effectively in this important exercise, our Party would appreciate if you would make available to us details of principal projects and their estimated cost under the respective budget agencies and clarify for us those project/amounts financed by loans and those financed by grants,” the letter concluded.

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