A university academic is warning the Freundel Stuart administration of the possibility of social unrest and increasing crime in this country as a result of a heavy tax burden, joblessness and the general economic climate.
But head of the Department of Management Studies at the Cave Hill Campus of the University of the West Indies, Dr Philmore Alleyne, said today all was not lost.
He told Barbados TODAY the power was in the hands of members of Cabinet and the private sector to avert this pending state of affairs.
In an interview this morning, Dr Alleyne cautioned that more and more businesses will send home workers, leading to more people with less disposable income in an already over taxed country and a lack of economic stimulation.
“We need to find a way to try to see how we can do what we call, grow the economy and stimulate; maybe in terms of some incentives, trying to get tourism back on track, getting the manufacturing sector to do more exporting . . . producing, and trying at least . . . getting more people employed,” the head of management studies argued.
“Certainly, if we have situations like what is happening at the NCC and all of these other institutions, and more people going home, there will come a time when you will have a lot more issues arising, potentially more social unrest, more crime, all of these things.”
Alleyne suggested that to turn the situation around, the public and private sector stakeholders had to “come up with a road map and remove the politics out of things”.
“If we don’t do anything at this point in time, we are going to have problems,” predicted Alleyne. “When you open the newspaper and see people crying, in terms of losing their jobs, it hurts a lot; I would imagine the powers that be recognise it and understand it.”
He lamented what he termed “this silence that is around”, where nobody is saying anything for fear of reprisals or victimisation.
Alleyne told Barbados TODAY that many companies were complaining they did not know how things would shape up by December.
“Now that level of uncertainty, certainly does not augur well for the country,” he cautioned.
Even though the business management expert is recommending a national approach to help solve the country’s economic woes, he is insisting that taxation is not the answer.
“When you look at how businesses are actually operating, most of them are complaining that if you have reduced spending . . . you have the VAT at 17.5 per cent when it was supposed to go back down to 15 per cent; you have consolidation tax coming out of employees; so the middle class that was before who would have had a lot more income to spread around, they have a reduced income. I mean you have taxes coming from VAT, income tax, then as well you having National Insurance . . . all these things; when will it end?” the senior university lecturer asked.
He pointed out that over taxation could be a disincentive to spending and that will have a domino effect.
“People don’t have the disposable income to spend or to do things, so they’re sticking to pure essentials. Companies who rely on those expenditures from consumers are now having depressed sales. When you have depressed sales . . . you have reduced profits.”
The UWI official also informed Barbados TODAY that more businesses were forced to seek loans from commercial banks, get extended overdrafts and at times cut staff in order to survive.