The impact of lower oil prices has not trickled down to the travelling public

Dear Editor,

Guyana remains unprotected from movements in the oil price as a result of our policy-makers failing to successfully diversify our energy sources over the last 50 years. The Ramotar administration will want to respond that they tried with the Amaila Falls Hydro Project. However, the premium and inflated prices they were asking the nation to pay was nothing but overbearing. APNU did justice by telling them to take a hike. Looking forward, Guyana will get another chance to fix this challenge at the right price this time.

Since late 2014, there has been a temporary decline in the oil price, but unfortunately the impact of the lower prices has not effectively filtered down to the travelling public and those who desperately need a few dollars more in their pockets. But this reduction in oil prices will not remain at this level forever, as the Saudis re-strategize and ‘big oil’ withdraws new investments from the marketplace. The Alliance For Change (AFC) as a partner in the newly formed broad based alliance has always advocated at the policy level for the active diversifying of our sources of energy. This vision is expected to be added to the collective development strategy of the broader alliance.

More people friendly policies were expected from the Ramotar administration with respect to these lower oil prices. If one observes the time and quantum of the trickle-down effect, the man in the street is marginally better off with the 10 per cent reduction in electricity bills and zero downward adjustment in transportation costs. Upon closer inspection, one would observe that since 2007, the policy at the Ministry of Finance was to inversely correlate the excise taxes with the oil prices, meaning the lower the prices the higher the taxes. That is why when the prices at the pumps were coming down in most countries, in Guyana they were stagnant until the 2015 elections date was announced. This reduction in the excise taxes in 2015 was not done out of empathy for the needs of the people, but more as a vote-buying tactic.

But what is worse is that even though the prices at the pumps were finally slashed by 30 per cent in late January 2015, the minibus travellers did not     benefit from lower fares. Any responsible government would have been actively engaging the minibus association to bring greater fairness to this situation for the travelling public. Rather the Minister responsible for Consumer Affairs has more executive time allocated to resurrecting the PYO across the country, than actively addressing this need of the travelling public.

As a back-up plan, it would have been a progressive strategy if the Minister of Public Works had put some temporary mechanism in place for the state-managed big buses to ferry passengers at market rates rather than the current inflated rates being charged. The lack of any effective policy actions from the Ramotar administration clearly illustrates how out of touch the PPP remains with the needs of the people.

Quite belatedly and in a most unyielding fashion, a paltry 10 per cent reduction in light bills was offered when the fuel bill for GPL went down substantially over the last year. The leadership of the newly formed broad based alliance is expected to review this mechanism and take progressive policy actions when the time comes, to ensure that greater remedy is brought to those who most need some respite from a decline in oil prices. We cannot continue this Jagdeo imposed model of unequally distributing the nation’s income and wealth so that those at the bottom of the economic ladder always get the short end of the stick. A greater share of the national pie has to be earmarked for the working class.

Yours faithfully,

Sase Singh

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