Recently, it became quite insightful to hear Minister of Finance and Economic Affairs Christopher Sinckler making statements regarding privatization. It is an eye-opener that Minister Sinckler agrees the “Government has a responsibility to meet certain social needs of the population”.
Worrisome though, is that this Minister of Finance has been flip-flopping on the divestment/privatization problematic. The very idea of divesting some state agencies into the hands of the private sector is intended to bring about enhanced levels of efficiency. It should be noted that privatization is the transfer of enterprise ownership –– in whole or in part –– from the state to private hands.
The shifting minister said: “Switching from one set of managers to another, say from public to private, does not satisfy the central and kernel question in the provision of social services, which is: who is going
This is an important question and, yes, he is correct to assert it cannot solely be about who is managing an entity; attention has to be also directed on “who is paying”. This revelation is not new, nor should it be a roadblock for the Government to make the best decisions while maintaining an optimality for providing public goods
Yearly, the Auditor General’s Report speaks to such things as undetected financial transactions and wastage which cannot be accounted for, or traced. These have been identified as factors raising the levels
of Government expenditure and debt.
Coupled with the age-old problem of an oversized Public Service, and gross inefficiencies, we know the current administration sent home more than 3,000 workers immediately after the last general election. One wonders why similar efforts cannot be made to create incentives for the private sector to thrive without over-reliance on the Government.
Nevertheless, having used the School Meals Department and the collection of garbage in Barbados as examples, Minister Sinckler is stating in 2016 that this economy “has not yet reached the stage of development where Government can ask people to pay for such services at the point of delivery as they have not the capacity
to do so”. This claim is remarkably telling.
It must be considered in the context of a self-confession wherein the Minister of Finance would have failed to implement necessary reforms of “restructuring” the Barbados economy. In fact, the Government’s master plan in 2013 was described by Minister Sinckler as “a revised fiscal adjustment programme and a growth and development strategy for Barbados”.
Therefore, Mr Sinckler would have failed to grow the national economy sufficiently that people would have disposable income and other investment funds available to them. The Minister of Finance would definitely have failed Barbados by not having necessary discussions with all stakeholders, and this is a governance issue. Governance is the process of policymaking through active and cohesive discussion among policymakers who are interconnected through a broad range of networks.
The Minister of Finance, therefore, after forthright and wholesome discussions, needs to set about devising a comprehensive plan of action which would ensure effective regulations governing the provision of services, and, importantly, finding the ways that funding or any subventions could be instituted without having the traditional burden on the public purse.
Earlier this year, Minister Sinckler was adamant that “a large part of our private sector, both in their structure and function, are really just a reflection of Government. That is just simply a fact. Many of them are really Government departments in disguise, operating as private entities, living off of the very public purse that the same statutory corporations are drawing on, as they say, ‘like vultures on the body politic
of Barbados’. That is just simply a fact”.
How long ago was this feature recognized by the Minister of Finance? And, apart from pelting big rocks at the private sector, what has he done in terms of incentives or other policy initiatives to chart the paths for a budding private sector in Barbados? “Sometimes I hate who I have to be. But I live in a world of flip-flopping loyalties . . . . Trust is a luxury I can’t afford.”
Clearly, Mr Sinckler’s pronouncement in January, 2014, that “it is crucial that we now undertake a long overdue reform of the public sector in Barbados” appears to be more wishful thinking than any practical statement regarding the work he and the Freundel Stuart administration have been taking to redress the “real” issues.
It was Mr Sinckler who said: “The growth strategy has to be led by private investment and entrepreneurship. Government’s role is to provide incentives, infrastructure and an enabling environment in support of private initiative and investment.”
Surely, this writer would agree with the minister that private sector growth is essential and that the Government has a sure role to play.
However, I am concerned that Barbadians are witnessing another cop-out by the Minister of Finance; another statement of fluff without the necessary glue to bind him to action. You may recall the Minister of Finance also stating in 2014 that “the Government is implementing a clear and credible plan to reduce the fiscal deficit, and the diversification and restructuring of the Barbados economy is well under way”. Really? Where is the evidence?
The Democratic Labour Party (DLP) in its 2013 manifesto stated that it would “implement strategies that will expand real growth in the economy, increase Government revenues, reduce the tax share of gross domestic product, and reduce the level of the country’s indebtedness to an acceptable level”. While accepting there are some positive signs in the Barbados economy, as alluded to by the International Monetary Fund (IMF), in which the Barbados economy “appears to have turned the corner with activity picking up”, the prolonged uncertainty and the slow process of getting information to the public remains a huge setback, contributing to speculation of malfeasance, corruption and wastage.
As the IMF recommends, focus has to be put to “support the nascent recovery”, with specific “measures to raise the efficiency of public services, which impedes private sector operations, pursue reforms to increase labour market flexibility without unduly reducing worker protection, increase training opportunities in a cost-effective manner to address the skill mismatch, and move forward with a viable and affordable agricultural strategy to strengthen its links with the tourism sector”.
Much more can be done in Barbados to ease the public sector while enhancing the private sector. Sustained economic growth should be the platform for setting things right in this country.
One would hate to think that Minister of Finance Sinckler represents the ideal example of a “skill mismatch”.
(Dr George C. Brathwaite is a researcher and political consultant, and up until recently was editor of Caribbean Times (Antigua). Email email@example.com)