The island’s most powerful public sector labour union is holding Prime Minister Freundel Stuart to his word on the controversial National Social Responsibility Levy (NSRL) in view of the performance of the tax.
The National Union of Public Workers (NUPW), which has been agitating for a 23 per cent pay rise or a subsidy for its members to help them cope with the levy, said now that Minister of Finance Chris Sinckler has reported that the NSRL raked in $50 million in the three months since it was increased to ten per cent from two per cent, Stuart had a duty to keep his promise and pay up.
While wrapping up a meeting of the Social Partnership at the Hilton Barbados Resort on August 11, Stuart repeated a claim he had made at a Democratic Labour Party luncheon on July 23 that the unions had agreed at previous meetings that the levy should be given a chance to see how it performed in the first quarter ending September 30.
He further recalled that he had made a promise that depending on its performance, Government would be willing to look seriously at the prospect of granting either the coping allowance or getting into serious discussions on a salary increase.
“I want to suggest to the unions once again that we give the levy a little more time to work, observe its performance, discussions would be taking place as has been agreed,” the Prime Minister said at the end of the August 11 talks.
The unions have repeatedly denied that any such agreement had been reached, with General Secretary of the Barbados Workers’ Union Toni Moore saying back then the Prime Minister’s statement was “totally untrue”.
This notwithstanding, NUPW President Akanni McDowall told Barbados TODAY now that the September 30 deadline had come and gone, and with the Minister of Finance reporting that the levy had performed well, it was time for Stuart to keep his own promise.
“The Prime Minister would have said at the Social Partnership meeting that he wanted to give the NSRL time to work but there was never a formal agreement to commit to September 30. Nonetheless, September 30 has gone and the Prime Minister and the Minister of Finance have committed to the NSRL. The Minister of Finance is now saying that the NSRL is performing . . . [well] and the Prime Minister said that if the NSRL performed the way that they expected there would be a review of our demands. So it seems that all of the stars have aligned,” McDowall said.
Speaking in Parliament this week as he introduced the National Social Responsibility Amendment Bill 2017, giving legislative teeth to the NSRL increase, Sinckler said it had raked in $50 million between July 1 and September 30, adding that this figure did not include the Value Added Tax earned on the levy.
“I believe the figure so far is just short of $50 million, which, if you were to multiply it by the four quarters, would give you just around $200 million [for the year],” Sinckler said.
When he stated in the May 30 Budget that the contentious levy would increase, the minister had projected that the tax would bring in $186 million minus VAT, for the remainder of the fiscal year – not the full year, as previously reported – and $291 million overall for a full year.
While announcing a number of concessions and exemptions from the levy this week, Sinckler said “the tax is performing close to what we projected net of these concessions, or the exemptions”.
Such an upbeat report prompted the NUPW to repeat its demands for some form of monetary compensation for workers.
“We are now hopeful that there can now be some move towards public servants getting their wage increase, or at the very least they should be able to get the coping subsidy because we can’t have a situation where as the grass is growing the horse is starving,” McDowall said.
The union chief explained that the workers were asking for no more than five per cent of Gross Domestic Product as a coping subsidy, which he said amounted to approximately $5 million, insisting that despite its performance the NSRL remained an albatross around the necks of Barbadians.
When Sinckler introduced the tax last year he said it was meant to raise $142.1 million annually to assist “in offsetting the costs associated with financing public health care service provision in Barbados”, to finance a new fleet for the Sanitation Services Authority and to procure parts for the existing fleet.
The trade unions and the business community have been opposed to the unpopular tax and organized a protest march in July, which attracted an estimated 20,000 people, although the unions claimed the number was over 30,000.