Tony Vieira's Comments
18 October 2017

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Eradication of Poverty
(Aired 23 March 2004)

    During Mash I looked at the mashers carefully, what struck me is that the white revellers and there were surprisingly quite a few, seem to me to be completely out of step with the way we Guyanese gyrate and mash to the beat of the music. They just did not seem to be able get the rhythm. This is no bad reflection on them, since this is our music and we know how to dance to it.

   But this reminded me that we have a government which is comprises mostly of people who were trained in the Soviet Union in the heyday of communism and just cannot get the rhythm of how to jump up to the new tune of open markets and democracy, they are just floundering around out of step with the rhythm of the rest of the world.

   To get the rhythm the government needs to reorient itself with the new way of doing things.   

   Now I come to the substance of this commentary, the government's own Poverty Reduction Strategy calls for fundamental changes in the way we do things with openness transparency and inclusiveness.

   The National Development Strategy which was financed by the Carter Centre and published in 2000 for implementation between 2001 and 2010 and which the government in its Poverty Reduction Strategy refers to as the foundation of its Poverty Eradication programme, differs in very significant ways.

   I have gone through this with you before, but I would like to touch on one or two differences which are crucial for the Carter strategy to work and which are completely absent in the Government's Poverty Strategy.

   The Carter document is very specific, that for there to be real progress in Guyana the PPP and the PNC must sit down and sort out their differences, this is the most important prerequisite to the Carter's National Development Strategy, the communiqué which is the next stage in the dialog started by Jagdeo/Hoyte in mired in controversy, with the PNC claiming bad faith, and the PPP claiming that they have been making the necessary changes to have more inclusive government but the PNC are not cooperating. But even though the constitution calls for a Procurement Commission and not a Procurement Administration, the Procurement Commission has not been formed and the Secretary to the Treasury who is supposed to be the convenor of the Central Tender Board now stands accused of corrupt practice and has been sent home, I presume that his salary of G$465,255 per month, as a contracted employee of the Government was not enough, this situation alone makes it imperative that the Procurement Commission be put in place immediately. Since apparently we can't trust anyone in this government.

   The Carter Centre document and the controversial World Bank 2003 Reports are very clear on this point, that only after there is political stability in the country, the Government must then enable the private sector to be the driving force of our development through investment both foreign and local to create JOBS. The World Bank tells us this, and I quote "the choices depend on whether Guyana would be able to pursue politics of social cohesiveness and political inclusivity and to improve the investment climate. In the long run renewed growth will have to come from exports, given the small size of the domestic market, with the Private sector leading the effort. The Carter Strategy tells us that the economy had declined recently and needs stimulus, not monetary stringency [heavier taxation] 2, the behaviour of the monetary aggregates since 1992, shows that they have declined in relation to nominal GDP. Another principle that could be abandoned is the practice of floating bonds for the purpose of liquidity sterilisation, it is illogical. The bonds are issued because the government deficit has given rise to inflationary pressures, and yet the burden of interest payment on them contributes, either, to a worsening of the deficit, or to making even more daunting the needed improvements in revenue collection" end quote.

   In other words this IMF imposed conditionality which this weak, inept, lazy out of step  government has accepted since 1993 has, and is, contributing to the decline of private sector investment, since it has had the effect of raising the interest rates, the result therefore is that all businesses, including all farmers especially the rice Farmers are going bankrupt daily because of it, and the government itself is increasing our National Debt as a result of our paying the Commercial Banks interest to keep this money out of circulation, so why keep playing this obscene game with the IMF?

   None of this has been addressed by this Government, additionally the tax base has not been increased, and the amount of people who file tax returns accounts for less than 20% of those who should. There seems to be no effort to go after those who do not pay taxes, of course some of them are friends of the PPP, what seems to be happening since it is easier, is to go after those who do pay and file tax returns and crucify them further, this country has been collecting a static amount by the revenue authority since 1999 of around 44 Billion dollars a year. In 1992; 74% of the Taxes came from Businesses, whilst around 24% came from private individuals; in 2002 the Bank of Guyana tells us that the private individuals now pay 74% of the taxes whilst the businesses only pay 24%. At Banks DIH for example which has 15 thousand Guyanese share holders from all walks of life, 49% of its total, I repeat total revenue goes to pay Income taxes, duties, consumption taxes etc. that is around 2.4 to 3 Billion Dollars a year; this one company which could only pay its 15,000 Guyanese shareholders a paltry 3% dividend, paid the government of this country nearly 12% of the total revenue of the annual Guyana Revenue Authority Income.

  Fuel particularly diesel fuel used widely in agriculture and the fishing industry lands in Guyana for 90 US cents per gallon that is 180 G dollars/gallon but at the pump diesel is selling for nearly 400 dollars per gallon, this makes agriculture uneconomical, the strategy calls for increased production in Agriculture not to tax them out of business, our rice industry is heavily mechanised so fuel is a major part of their expenditure both in the fields and at the mills, no rice mill I know of buys electricity from the power company they just cannot afford it, so isn't the first step of the strategy to bring down the cost of power to the consumer? By eliminating the line losses? Of course it is. 

   The Government's Poverty Eradication Strategy promised lessening the bureaucratic burden on the nation, less Ministers and Ministries, but they are paying lip service to this conditionality of the International Funding Institutions, since we still have the same amount of ministries with no tangible evidence that any effort whatsoever is being made to reduce them, I have in my possession a list of Contracted government employees and their salaries totalling 620 employees, 171 from the ministry of Youth Culture & Sport alone. Who do these people think that they are fooling? For example why are we paying former Minister of Amerindian Affairs Vibert Da Souza $204,204 per month to be our Hinterland Project Officer? And why is former Commissioner of Police Laurie Lewis designated as Joint intelligence coordinating officer receiving 300 thousand a month? From the Office of the President for the past year?  

   Now we come to where the Poverty Reduction money is going, I am informed that the bureau of statistics have received several new 4x4 Toyota vehicles, that several other government ministers have also received new vehicles, I see a frenzy of road building going on from Rosignol to Timehri and on the West Bank of the Demerara River, now I live on the West Bank and I want to know why we need a wider road? I do not see the necessity for it, and how might I ask will these roads reduce poverty? I had predicted that when all of this debt relief money is given to this country, all the PPP will do is award contracts to build totally unnecessary roads and totally unnecessary structures riddled with corruption and generally fix themselves up, and to hell with the poor.

   Any Guyanese out there waiting for cheaper more reliable electricity, cheaper fuel, better water delivery, lowering of the tax regime to encourage those who do not now file to do so to jumpstart investment, thereby creating jobs specifically for export, which is what all of these strategies call for, don't hold your breath.