Prominent political scientist Dr Don Marshall has described as “good politicking” Prime Minister Mia Mottley’s Budget presentation on Wednesday.
But Marshall, Director of the Sir Arthur Lewis Institute of Social and Economic Studies (SALISES), said that in opting not to deliver a financial statement, Mottley was not obligated to reveal any planned expenditure cuts.
Speaking at the Democratic Labour Party’s weekly lunchtime lecture today, Dr Marshall said: “I want you to recognise that there was no financial statement, so without a financial statement you’re not obliged while standing on the floor to engage in what could be a messy discussion about where the expenditure cuts would be, where they will fall and who will bear the brunt of those measures.
“So you could argue that it is good politics, because ultimately a Minister of Finance is not required to go back to Parliament to discuss expenditure that he or she does not intend to meet or intend to max out,
“So no Financial Statement means good politicking from the point of view of a new Minister of Finance that wants to convince Barbadians to stay the course.”
Despite the Prime Minister having not revealed any planned Budget cuts, Dr Marshall said they should be expected, as Government was obligated to do so by the International Monetary Fund to reach its intended targets.
He pointed out that while cuts up to this point amounted to about “4.5 per cent of the targets”, this meant that “another 1.5 per cent to two per cent” were to go.
He said this meant a further reduction in the size of Government, which had to be sustained throughout the duration of the four-year IMF-backed economic programme.
“So I would hazard to guess that you can expect there will be some expenditure cuts going forward across the Ministries and agencies and that the four-year extended credit programme with the IMF will continue on pace,” the academic said.
From a political perspective, Dr Marshall praised the Prime Minister for her approach, saying she had done a good job in avoiding tough questions which might have been asked if she had chosen to deliver a Financial Statement.
He said: “Regardless of what happens at these annual exercises called Budget speeches, the eye on the prize for the Government of the day is to stay the course and meet the demands of the IMF.
“It is important in the midst of austerity to win confidence and the Minister of Finance is free to try to engender confidence as is possible . . . but on the question of the Budgetary presentation, I think the Minister of Finance did quite excellently in assuring that she avoids a very difficult conversation of Barbados.”
He said that while in Mottley’s budget there had been relief in the area of direct taxation, it could be argued that the cost of living and indirect taxation had risen by the introduction of new property taxes and by the announcement of a 75 per cent hike in bus fares.