Government continues to pump millions of dollars into the loss-making Barbados Postal Service (BPS), even amid calls for reform and continued decline in its revenues in an age of rapid technological development.
In an annex to the 2018-19 Estimates of Revenue and Expenditure, which were laid in Parliament on Tuesday and will come up for debate next week, Government revealed that the BPS was facing a $7.1 million deficit this year, despite being allocated $29.7 million to cover its expenditure.
The over 400-page Estimates document, which will form the basis for extensive discussions in Parliament next week, shows that the post office’s projected expenditure is only down 1.4 per cent or $424,826 from last year’s figure.
At the same time, revenue for the post office for the 2018-19 financial year is projected at $22.6 million, up 12.8 per cent from $20 million. However, this is simply not enough to cover its overall spending.
Revenues from the postal service have been on the decline in recent years with private couriers and technology with instant messaging applications forcing a massive shift in business and consumer behaviour.
It was exactly a year ago that former Prime Minister Owen Arthur warned of the need for immediate rationalization of Government, while suggesting the BPS, which currently employs about 600 people at 19 physical locations across the island, may be a good place to start.
“I am not saying to sell it, but I can’t tell the last day I sent out a post card . . . .Yet every year you have to transfer into that,” he said, while pointing out that “Trinidad addressed theirs, New Zealand addressed theirs [but] we in Barbados continue to bury our heads under the sand.
“We have to rationalize the operations of a post office to make it compatible with living in a world where people are no longer sending to you through the post, but sending messages and post cards by WhatsApp,” the former prime minister and minister of finance had said, while emphasizing that adjustments had to be made.
However, no such move has been made, even though Minister of Finance Chris Sinckler indicated last week that Government was now willing to take on board Arthur’s suggestion for national consensus on the way forward for the island’s 63 statutory entities – including the Transport Board, which was the other entity identified by Arthur for reform, this time possibly through privatization.
However, Government has allocated $21.8 million in this year’s Estimates for the Transport Board in terms of subsidies, as well as a further $3 million in grants to assist it with capital works and much-needed improvements to its provision of public transport.
Like the Transport Board, Government has also not lost faith in the postal service, which based on a breakdown of its latest allocation, is to get $188,500 for upgrade of property and plant this year, compared to just $18,500 in the Revised Estimates for the 2017-18 financial year.
This amount will go towards the installation of water storage facilities and air condition units at various offices.
A further $1.5 million has been set aside for post office maintenance of property, up from $1.3 million; $98,000 for travel, up from $95,000; and $51,000 for furniture and fittings, up from $29,055.
The draft Estimates also make provision for $318,875 for supplies and materials, while $42,499 is to go towards structures in the upcoming financial year, compared to the $300,090 and $16,770 in the current financial year respectively.
The document explained that the amount allocated for structures was provision for “network and electrical cabling and telephone installation”.
The amount allocated for professional services will more than double, going from $75,000 in the current financial year to $194,000 in the 2018-19 financial year.
This, it said “provides for the payment of consultancy fees” for postal reform projects, postal coding and design of postal manuals, information technology and renovations to the General Post Office.
However, there are declines in the amount allocated for vehicles and machinery and equipment in the upcoming financial year.
Statutory personal emoluments are also to be reduced from $19.1 million to $18.79 million while “other personal emoluments” will go from $2.6 million to $2.3 million in the upcoming financial year.