Minister of Finance Chris Sinckler says while Government is open to selling off some state enterprises, as some economists have recommended as a way to improving public finances and helping to accelerate recovery of the economy, it has to carefully approach the issue before taking a decision.
“We are not rushing ahead to just go picking this and picking that and privatize this and privatize that,” he told reporters this week. “We are going to [take] a judicious approach to this matter, where it lends itself, where everything substantially lines up, and we will consider it.
“If it doesn’t, we look at the cost all around – financial, social and environmental costs – and then we make a decision. It is not that we are opposed to doing it but it has to be done for the right reasons and in the right way”, Sinckler added.
In determining which entities to offer for sale, Sinckler acknowledged that it would be easier to “move” a commercial entity that was making a loss, than an entity that was offering social services.
“That is why I say, strategically, Government looks at its asset base and it sees which ones make sense to move that can give immediate, medium and longer term benefits, and we have not been shy to do that. Where they have deeper and serious implications negatively on both the public and the Government side, we have to study those things very carefully,” he explained.
So far, Government has announced the intended sale of the Barbados National Oil Company (BNOC). The sale of that entity is being finalized.
Earlier this week on a televised programme to discuss the island’s economic performance, University of the West Indies, Cave Hill economist Professor Andrew Downes spoke about the issue of public sector reform, saying there was an increase in transfers and subsidies to statutory corporations.
Downes said it was about time “fundamental decisions” were made in that regard. Without naming any state entity, he added that some were established to enhance efficiency but were instead creating problems of inefficiency. These ones, he added, should be examined and restructured or closed.
“One will argue there are legislative issues involved but I don’t know if there is where the problem is in relation to getting the work done because we have to follow certain regulations, laws and so forth going forward, but we need to take a serious look at it,” said Downes.
Sinckler said it was necessary to take into consideration the implications of privatizing the state entities, especially the social services.
“So when I hear people say privatization, I ask them privatize which companies. Are you talking about sanitation services? Are you talking about public transport, hospital services? Which ones are you talking about because each one of those has a particular challenge or set of challenges that would have to be carefully thought about before you go down that road because it has implications for ordinary citizens in Barbados,” he added.
“So when people say privatization, they have to study all of the permutation and implications around the suggestions
I hear them making in relation to that,” insisted Sinckler. “So I think that rather than people saying, ‘let’s privatize this and let’s privatize that’ because it sounds good and looks easy to do, to give it a little bit more thought as to the implications of it and how it can be done.”