He has not been given the promised job of lead economic advisor.
So today former Prime Minister Owen Arthur proceeded to dish out some free economic advice to the Freundel Stuart Government.
Warning that the Barbados economy remained in intensive care and that it was still in a very delicate position in terms of its achievement of growth, Arthur, who confirmed that he had earlier been approached by Minister of Finance Chris Sinckler to replace the retiring Sir Frank Alleyne, who is in his late 70s, as head of its “independent” advisory council on the economy, advised today that the next “unpopular and painful step” that needed to be taken by Government was abolishment or amalgamation some state enterprises “as soon as practicable”.
The former prime minister, who was in office for 14 years, also warned Government to proceed cautiously on a number of projects, including the much touted $500 million sugar restructuring plan; the $800 million waste-to-energy project, as well as the Sam Lord’s Castle redevelopment, the proposed marina in Bridgetown and the cruise pier – all of which he said could wind up posing an additional burden to the already stretched public purse.
In his speech which found favour with Government Minister Donville Inniss, Arthur also warned the Central Bank to stop printing money, calling this “an act of vandalism”, which puts the stability of Barbados dollar in peril.
The former Barbados Labour Party (BLP) leader, who currently sits as an independent in the House of Assembly, also warned that the country’s foreign reserves, which have fallen by half a billion dollars since 2009, were headed in the wrong direction and that the current deficit position was worse than the worst case scenario of 3.5 per cent, envisaged under the island’s
medium-term development strategy.
Also insisting that failure was not an option, the former Minister of Finance told Government that it should also seek to get capital investment of at least $500 million in order to put the island back on a sustainable growth path.
Adding his voice to the debate on the 2016/2017 Estimates of Expenditure and Revenue in the House of Assembly this evening, Arthur further advised Government to focus on making the island an export and investment driven economy.
Questioning if the country was on a “solid growth path” and in a position to “fend off” some of the major threats that could destabilize some of the efforts being made, Arthur said had he been given the job of advisor to Sinckler he would have sought to ensure the Minister of Finance was making the best decisions based on the “best information”.
“Some of the things that have to be done by the Government of Barbados, some of the things that must be done by many of the Governments of the Caribbean are things that may not necessary lead to immediate popularity, but are things that must be done because they are in the best interest of the country,” said Arthur.
“The Minister has to make and has to help to supervise over at least $200 million of adjustments in the money we provide for public enterprises. It has to start,” he said, warning that, “cutting the state-run BIDC [Barbados Investment and Development Corporation] by five members of staff is not the solution”.
He said he was prepared to give Government his support should it bring a programme, based on his suggestions, which sought to “temper the effects at the personal level”.
The trained economist, who was credited with leading the island through 14 years of economic prosperity, contended that Barbados was worse than it should have been given that the fiscal deficit, which is projected to reach 4.2 per cent of GDP in the next two weeks, should not be higher than 3.5 per cent, based on the MTFS.
“Perhaps if I was advising the Minister of Finance, I would tell him that I have to agree with the Governor of the Central Bank [Dr DeLisle Worrell] that the policies that should have been pursued this year in the Estimates are policies to have a fundamental restructuring in certain aspects of the Government while addressing issues about debt,” said Arthur.
The Member of Parliament for St Peter, who has extensive work experience in the region as an economic advisor, also called on Government to revisit some of things done by National Heroes Errol Barrow, whose legacy was one of state enterprises, and Sir Grantley Adams, who has been credited with nationalizing the transport system.
“We have to do it. I wish to have been in a position to tell the Minister [of Finance] and to tell the Government that it has to do it not to get popularity but you have to do it because there comes a time when good politics must become good policies. You have to do it,” insisted Arthur.
“It is not a matter of coming to office misleading the public, but there is no way in which we are going to get out of this unless there is privatization. There is no way we are going to get out of this by rationalizing our relationships with state enterprises. Some will have to get amalgamated [and] some will have to be abolished, but it must be addressed.”
In pressing for some state enterprises to be shed and for others to be merged, Arthur suggested to Government that it should create a database with the names of those who would be affected by the changes and for them to be provided with access to retraining.
He said the proposed database would also be used to give them access to the Enterprise Growth Fund, Fund Access and other funding facilities to assist them in the start-up of their own businesses.
In addition, Arthur suggested that Government should put in place a procurement policy, which would give affected workers at state corporations “first access” to small contracts from Government.
“What is happening now quite frankly, is that the Government is afraid of addressing this matter, but it must be addressed. And Dr Worrell is at least right on this point that you cannot deal with the debt alone unless you deal with the reform of the public enterprises because it is the public enterprises, the debt of the public enterprises and the amount by which you are guaranteeing them that is causing the build up of debt in countries like Barbados,” argued Arthur.