Public spending promotes development, delivers services and creates employment. It is a major instrument used by a government for these purposes and also to influence private investment and growth of the economy. Sometimes it is necessary to reduce public spending to maintain economic stability. When the economic indicators are good, governments may increase spending. When inflation is high or threatening or the budget deficit is too large, which can also trigger inflation, raise interest rates and create other negative tendencies, public spending may be reduced.
Very often and in many countries, allegations of corruption are made in relation to public spending.  Horror stories are heard in many parts of the world. Recently a governor of a Nigerian province was imprisoned for stealing US$250M. What would happen in these countries is that after considerable public pressure, investigations are carried out and perpetrators are prosecuted. Sometimes corrupt practices persist, especially in countries with authoritarian governments.
In developed countries, even though corruption is an issue in many cases, the focus in relation to public spending involves the economic difficulties which the U.S. and many European countries are undergoing. Austerity programmes are being implemented which result in vastly reduced public spending. The consequences are deeply traumatizing for millions of people who have been thrown out of work and who have had salaries and pensions slashed.
An argument has been going on since the recession started in 2008 in the U.S. and Europe, as to whether austerity or stimulus measures should be applied. Three experiences are of note. In the U.S., the government implemented a stimulus package, which some economists argued was too small but better than nothing. Growth and employment figures are up, but not enough to suggest that recovery is clearly on the way. In the U.K. the new Conservative Government, facing a huge budget deficit, abandoned the cautious approach of the previous Labour Government of halving the deficit in five years, and implemented substantial spending cuts which drove the economy into a tailspin, chocking off growth and increasing unemployment. Britain is now going, if it has not already gone, into recession. In the Euro area, German influence had resulted in a policy of drastic austerity for Greece, Ireland, Spain and Italy, in return for Euro support in dealing with debt and budget deficit issues. All of these countries have gone into dire straits, worse than before, as a result of the austerities which they have been required to impose. Greece is now bolting, and unless a government is formed after elections just held, new elections are likely to return the left to government, which will dismantle the austerity package and leave the Euro. Rather than facing a decade of austerity and throwing millions into poverty, Greece happily, will follow the experience of Argentina a few years ago. Argentina defaulted, refused to pay the bankers, implemented measures to protect the country and its people, and in two years was growing again. Shortly after it began to experience 8 percent growth, helped by some other positive factors. No banker went to bed hungry. Millions of Argentinians were spared that fate.
The election of Francois Hollande as the French President and the dramatic loss of support by Angela Merkel, the German Chancellor, in recent local elections, together with a shift in public and professional opinion, may lead to a modification to the cuts in public spending. But it is doubtful whether this will bring relief to the millions who are suffering.
The entire argument is between progressive and conservative opinion. It is the latter which holds sway at present. It dictates that the current economic crisis can only be resolved by introducing confidence in business to invest. This can only be done, it is argued, by having a stable and debt free economy, hence, drastic austerity measures to reduce deficits. The unspoken principle is that the working people, who are the ones to suffer when cuts are made, must bear the burden of the crisis created by the banks. Of course, less public spending means less taxes. That is why conservatives argue that cuts in public spending should be accompanied by reduced taxes, especially on the wealthy. Progressive opinion suggests that increased public spending is the answer. Based on Keynesian theories, this will stimulate the economy, create jobs and return the economy to growth.
Notwithstanding that in Guyana cuts to the budget were made by the Opposition in different circumstances, cuts are nonetheless associated with reactionary thinking. They ought to have learnt by experience but did not. Some years ago, the Opposition voted against the education budget for Berbice. The government had a majority at that time, so the Opposition’s negative vote was merely symbolic. But the next day, the Opposition had to face screaming headlines that they are refusing to support education for Berbicians. Reactionary austerity programmes result in job losses, so do the Opposition cuts.
The reasons given for the cuts are to reduce contract employees, stop corruption, influence policy changes and to gain leverage. If the Opposition had paused for a moment to consider, they would have recalled the incident mentioned above in relation to education for Berbicians, and would have understood that throwing people out of work and obstructing developmental programmes will not stop corruption or achieve any of the objectives they set out to achieve. Instead, they are facing daily criticisms and an effective campaign aimed at discrediting the cuts which have been made.
Cuts by the Opposition make no sense. They are illogical, ineffective for the purpose, will not stop corruption, smack of vindictiveness and harm innocent people. Corruption is a problem in a large number of countries. It is also a difficult problem. With the best will in the world, it is sometimes difficult to grapple with. And governments sometimes do not help. I believe that the Procurement Commission could have been established long ago, but it was left in abeyance after an inconsequential difference of opinion between government and opposition in relation to the composition. It was the responsibility of the government to aggressively pursue a resolution of this minor difficulty but it did not. It allowed this matter to remain and fester, all the while absorbing suspicions and allegations.
The Opposition has had only a short period to savour their victory and to determine policy. It cannot be an easy matter to chart a constructive course quickly and unerringly. But the scope is wide and the possibilities are great. Nobody believes that it would be easy and the Opposition should not assume that the government would roll over. But reckless cuts to the budget which halt programmes and harm innocent people are not the way to go. Licking your chops to cross- examine this person or that person merely reveals an agenda for vendetta, rather than a considered programme to correct wrongs.