#BTColumn – All Bajans matter – or so they said

by Steve Prescott

Disclaimer: The views and opinions expressed by this author are their own and do not represent the official position of the Barbados TODAY Inc.

I must admit I enjoyed Minister Kerrie Symmonds’ use of language when he “blasts exploitative mindsets”, as the headline was put by Barbados TODAY in their recent article about the row over the National Minimum Wage (NMW).

As laudable as that might be, I’ve got to ask though; Which member of a cash-strapped Government thought it was sensible to reduce Corporation Tax by more than 95 per cent – i.e. reducing taxes from 30 per cent (for profits over $30m) to one per cent?

Maths may not have been my strong point but that’s a loss to the country of $9m, or, to put it another way, earnings of only $300k. A company making profits of $30m just earned the easiest $9 m of its life.

As if that’s not bad enough, as far as I can tell there was no quid pro quo.  What benefit have Barbadians received from this tax policy?  I’m left presuming, businesses have used it in any manner they see fit.

This government gave away that money and never asked for anything in return. That doesn’t seem to be sensible and prudent economic policy.  Even if there were some stipulations placed on business in return for this tax reduction, what could be more important, at this time, than the NMW?

So this government didn’t, couldn’t or wouldn’t set a policy requirement which said we’ll give you $9m bucks but here’s what we want in return – a commitment to the National Minimum Wage.

I quite like Dire Straits, but forgive me, I have to rephrase a line in their song – “Money for nothing” and your employees for free!!  For me I’m describing flawed thinking which leads to flawed policy with consequences.  The Blue Ribbon Report spells it out.

But the follow-on question becomes this; would it have cost $9m to improve the lot of their lowest paid workers and upgrade them to a fair national minimum or “living” wage?

A workable Government policy could have been based on the promise Every Bajan Matters; so we’ll take the Corporation Tax and for say, 2 years, underwrite a proportion of the uplift for businesses that might be struggling and assist all businesses to achieve a NMW.

Because who loses out? Who is losing out? The employees of these companies who should be paying Corporation Tax. So many employees and their families are in dire straits.  So many losing livelihoods or struggling to put food on the table.  And yet in so many press conferences I hear the phrase “We’ll get through this together”.

Whilst this government was busy getting their feet under the table and spreading $4.5m in salary earnings around a large administration and giving public workers a 5 per cent salary increase, the rest of the country was being given fuel price increases and sewage, garbage, water increases and NO INCREASE IN THE NMW for those sectors that are entitled to it.

And here we are now, at the worst time of many people’s lives, arguing about implementing a countrywide NMW policy.  Seriously?  When this would lift many heads above the drowning waters of poverty, unfairness and inconsideration for the needy?

It seems to me, this Government’s Corporation Tax policy has allowed business to “exploit” workers. What else did they think employers would do? Pass on those savings to their employees?  Provide training, bonuses, incentives, pay rises? One would hope so.

Handing out this tax break is a poisoned chalice because now they want something for it which they didn’t stipulate at the beginning.  How do they come back from that?  How will they ever go back to the 30 per cent tax rate (and keep their votes)?

The economic landscape has changed; it’s going to be harder to implement now, all because they didn’t act on it 3 years ago.  People are in dire straits because business was given money for nothing. Am I allowed to say “bare foolishness” (I’ve come to enjoy that term)?  Remember, just an opinion!

Steve Prescott (LLB Hons) is an Employment Law Consultant & Advocate Bajan Pride – “From the People for the People”, steve@lr-and-p.com