Vice President of the Democratic Labour Party (DLP) Ryan Walters is calling on the Mia Mottley administration to consider expanding the Barbados Employment and Sustainable Transformation (BEST) programme to include other sectors.
Walters, who is the DLP spokesman on business and entrepreneurship, said many firms across a range of sectors continued to struggle due to the ongoing effects of the COVID-19 pandemic. These, he said, could benefit if Government expands the BEST programme by $200 million to support the non-tourism businesses in the area of new hires.
“I would recommend adding another $200 million onto that BEST progrmame and make it available to other sectors for new employment only, not to sustain what they currently have, but to employ new people. And if that is done, we can see people coming back to work, we can see people buying more, we can see consumption going up, we can see small businesses reopening, we can see income tax increasing, we can see VAT increasing,” said Walters.
Under the $300 million BEST scheme, which was implemented towards the end of September 2020, tourism-related entities are able to receive grant funding to re-hire a minimum of 60 per cent of their workforce on 80 per cent of their normal salary for at least one year.
They are also able to receive an investment of up to $2 million in the form of preference shares, to fund projects to upgrade and transform their facilities.
With a less than ideal take-up of the BEST scheme, government recently made some adjustments, making $30 million of the funds available as loans to tourism entities that do not qualify or wish to participate in the programme otherwise.
There is also a matching grant component of up to a maximum of $500,000 for an approved tourism enterprise.
Speaking on Sunday, during one of his Linking up with Ryan programme, Walters said he believed the best way to help stimulate economic activity now was to get more people back to work.
He explained that a lot of businesses were still struggling to keep their doors open and if the assistance was offered they would be in a better position to stay afloat and employ more people, creating a ripple effect in the economy.
What is more, Walters said, this would help generate revenue back to Government in the form of the various taxes.
“You have a situation where the Government has invested $300 million in the BEST programme, but what they have done is that they have given this money to the [tourism] related businesses only, but there has been fallout across all industries, across all sectors which seemingly are left to fend for themselves,” said Walters.
“So where unemployment is roughly around 18 per cent or so I think what the government needs to do is to expand that BEST programme into areas that are outside of the tourism sector . . . One of the biggest things that this will also do is this will actually help to recapitalize the National Insurance Scheme (NIS).
“The Government seems to have borrowed money or is borrowing money or getting money from somewhere to put into NIS, but if they create employment in a programme like this that affects lots of people in all sectors, you will actually be recapitalizing the NIS with about $50 million in one year if you consider the contributions from both the employer and the employee,” he explained.
At the end of August, Government announced that Cabinet had agreed to recapitalise the Unemployment Benefit Fund of the NIS to the tune of about $180 million over a three-year period.
With the arrival of the pandemic on Barbados’ shores in March 2020, the tourism industry was devastated, several businesses closed and unemployment skyrocketed.
Unemployment claims reaching close to 52,300 from over 32,000 people, resulting in the NIS paying out in excess of $155 million. The unemployment claims on average prior to 2020 were around 11,000. (MM)