Jagdeo breaks silence on budget cuts

“The country’s vibrant economy might be crippled in the near future if the opposition continues to stymie Guyana’s development”

By Svetlana Marshall

Breaking his silence for the first time since demitting office last year, former President Bharrat Jagdeo, speaking at the commissioning of the New Building Society’s new headquarters tore into the opposition last Friday, deeming their recent cuts to the national budget as a vindictive act, which will set the country several paces back.
The combined opposition had chopped some Gy$20 billion from the budget, Gy$18 billion of which was funds anticipated from Guyana’s forest partnership with Norway. Cuts to other agencies such as National Communications Network (NCN), the Guyana Elections Commission (GECOM), the Ethnic Relations Commission and Office of the President, made up the other Gy$2 billion.
Government has been fighting tooth and nail with the opposition over the cuts, and has been going around the country informing citizens about its likely impact on their communities and the country’s economy.
Addressing the commissioning ceremony, Jagdeo warned that the country’s vibrant economy might be crippled in the near future if the joint parliamentary opposition continues to stymie Guyana’s development. Jagdeo, an economist by training, said while some developed countries are experiencing financial turmoil in their economies, Guyana is blessed with a growing financial system which supported real sector growth and activities for the past six years. He posited that this progress did not happen by luck, but due to fiscal policies implemented by the government of Guyana. However, Jagdeo said this trend may not continue if there continues to be an assault on things that keep the economy growing.
He said while the president of America and Congress met and approved a bill to spend US$700 billion more to generate economic growth, all in an effort to avoid a recession, Guyana’s joint parliamentary opposition made significant cuts to the national budget, despite the fact that Guyana has the fiscal space. “So he (Finance Minister) took the budget and the budget was truncated, I could understand if you are talking about tax payers’ money, but we must look at some of the components that were truncated.”
The former president further said that sitting in a bank account is some US$70 million from Norway for the Low Carbon Development Strategy (LCDS). This money, he said was earmarked to execute several viable projects, but despite it not being tax payers’ money or a loan, the opposition still went ahead and denied the financing of key projects.
He said government had decided to spend some of the US$70 million in buying equity for the hydro project so that the price of electricity will be cheaper for all Guyanese and to businesses, but that too has been put on hold due to the cut.  “The unconscionably cut, not tax payers money, not a loan, a grant that the government would have spent on trying to utilise investment in clean energy that would have had a huge impact on balance of payment.”
In its campaign to stymie the development of Guyana, Jagdeo noted that even funding for Amerindian villages across the country have been affected due to the budget cuts. “The Gy500 million for Amerindian communities for demarking their lands, everyone of the villages came up, everyone of the villages came up with a development plan and that money that came from a grant would have gone on to helping them… create jobs in those villages, and to get to greater opportunities for young people who live in the hinterland, that too was cut.”
Additionally, he said, using some Gy$500 million from the money garnered from the LCDS initiative, it was government’s intention to assist the private sector, but this too, he said was cut and yet the private sector organisations have remained tight lipped. The former president noted too that the Republic of China contributed funds in the form of a loan for the acquisition of the 90,000 laptops to support the One Laptop Per Family (OLPF) initiative, but this too suffered at the hands of “spiteful politicians”.
The health and education sectors, among others, have suffered a similar fate, he said and this must come to an end.  “It is vindictiveness, it is not policy-led by any design, it is pure vindictiveness and if we don’t spend these are grants and soft loans, then the economy will not grow and people would not be able to afford houses because they would not have jobs. The financial system would collapse.”