BILLIONS of dollars will be pumped into the infrastructure, crime and security, communication, climate change and resilience, health and education sectors this year when government unveils its first full year budget this month.Finance Minister Winston Jordan said the APNU+AFC Administration is currently making some adjustments to the budget. Those adjustments will see massive spending in the area of infrastructure.
Speaking with the Guyana Chronicle, Jordan noted that this year’s budget focuses on “infrastructural transformation” aimed at bridging the varying gaps that exist across the country. “The major gap is the gap between the coast and hinterland,” he told this publication at his Main Street office.
“We keep saying that the hinterland is where all the wealth is but we have most of the people strung along a narrow strip on the coast. So we really want to bridge that gap. Whether the bridging of that gap be physical bridges, roads, boats, airstrips, communication… all those areas we are going to tackle,” he added.
Jordan in his major budget presentation in August last year presented a truncated budget totaling some $221B. This year’s budget, he said, will be bigger.
“Proper infrastructure is crucial for attracting business, existing business to stay in business… linking our different parts of the country,” the minister stated.
With a bigger budget and the focus being on infrastructural transformation, Jordan said citizens can look forward to seeing work done on the Linden-Lethem road.
He explained that government will be budgeting monies to fix the road and keep it maintained as best it could while donors are being engaged. The Finance Minister stressed that there are many projects that government is looking to have developed in 2016 and is currently exploring all possibilities that exist to have those projects come to fruition.
“On airstrips, we have been able to engage the Caribbean Development Bank (CDB)… to interest them in airstrips, some airstrips need to be modernised at those ports… given the types of aircraft we can no longer have a little thing dug out,” said Jordan.
He added that with the interest expressed by the CDB, government is hopeful that the loan would be approved soon. “The CDB is interested, and I don’t know if the loan can be approved by next year but I am telling you we are aware of this interest and it is one of the several projects they have been looking at. They are excited,” the Finance Minister added.
REPLACING LADY NORTHCOTE
Additionally, Jordan said the government is in the process of securing financing for a vessel that will be replacing the MV Lady Northcote that operates the North West District route. In September, Cabinet had approved $69M for the docking and repair of the Lady Northcote despite concerns about maintaining the old vessel that transports persons to Region 1.
“We have India as a donor as it relates to finding financing for the vessel we intend using on the North West District route to replace the Lady Northcote. As far as we know, it is a two-part financing, one part loan, one part grant. We understand that the loan part has been approved in principle; the grant part we understand has been approved in principle but it awaits the Indian committee on finance for formal approval. Sometime next year, this will be made available,” Jordan disclosed.
Meanwhile, in the communication sector, he said efforts are going to be made to increase the reach of the National Communications Network (NCN). He noted that money will be budgeted for the expansion of NCN’s reach and for improving the entity’s radio coverage. “That is a critical area we are looking at,” he said.
Additionally, in the crime and security sector, focus is being placed on strengthening the country’s defence. “Defence remains a major issue for us so we would be looking at some spending in that area.”
Climate change and resilience remain steadfast on government’s agenda, said Minister Jordan who explained that with the effects of climate change, “we’d have to look at carefully both in terms of how we see ourselves living on the coast and our capacity to maintain ourselves here and in the fullness of time whether we are going to be moving in terms of habitation towards the hinterland.”
MOVING FROM COASTLAND
Jordan said one of the reasons government is placing much emphasis on infrastructural development is to facilitate persons moving from the coastland to the hinterland regions in time to come.
“That’s why we are placing this critical emphasis on building infrastructure; so that people can naturally move and have economic activities for sustenance and survival,” he said.
In the area of health, special emphasis would be placed on improving primary healthcare facilities, Jordan said, noting that special emphasis will be placed on maternal care. “There is significant focus on primary healthcare,” the minister said noting that primary healthcare is critical to a healthy nation.
He said too that construction of the Specialty Hospital would be evident this year. “We should start seeing columns and so going up,” he said optimistically while noting that he has no doubt that Fedders-Lloyd will construct a ‘first class hospital’.
He said while he appreciates the criticisms placed at government’s feet on the awarding of the Specialty Hospital contract to Fedders-Lloyd, Jordan noted that the company has been in existence for a number of years and have built many state-of-the-art hospitals.
“For all of the discussions that have been going on which are healthy… it is the government that has to make the decision in the best interest of everybody,” asserted Jordan.
ALLOCATION TO UG
This year’s budget will also see budgetary allocations being made to the University of Guyana (UG). The country’s lone public university has been in a cash-strapped position for a number of years and has lobbied the former administration for financial support repeatedly.
“On the education side we want to continue to improve education … our only public university has been going through some trials and so we want to see areas where we can …within the limited resources …return this university to the pride and glory that it had in its early days… 60s, 70s. I don’t know how much we can do,” he said, noting that the allocation to the institution would be a welcomed move.
The Finance Minister emphasised government’s commitment to ensuring that the traditional sectors continue to thrive and impact the country’s economy. He said, “We will continue to support sugar in the context of the Commission of Inquiry (COI) and see discussions to continue. We will continue to support them but our support won’t be infinite.”
Jordan noted that sometime this year, an assessment will be done to conclude further the future of the sugar industry here. Beyond that he said an extensive analysis would be done on the APNU+AFC Government’s view of the sugar industry in 2020, the end of the coalition’s first term.
“We hope to provide as much support as we realistically can,” he said.
Similarly, the minister said government will continue to support the rice industry despite the concerns it has.
“We cannot relegate the traditional sectors that have served us well to the dustbin of history. There were there forever, their importance remains even more today – contribution to GDP, employment and way of life,” he added, noting that government would not be “romantic about these industries.”
“All the issues about subsidies …big countries can give subsidies…they can afford it. We cannot afford it. There is a limit to what we can afford. We have to recognise this and try to be as competitive as we can. There are no sympathies out there… people may like Guyana but when it comes to buying your product they want it as competitive as the next guy,” the minister emphasised.
Jordan also stressed the need to modernize and improve processes and technology so that the cost attached to many of the agencies can be reduced.
Final preparations are ongoing, he said, but noted that with this year’s budget being the first one in which the Constitutional agencies’ budgets are to be presented to the National Assembly for approval, government has to abide by the decisions of the House.
“Once approved by the National Assembly, we can’t touch them. We still have to get those budgets from the National Assembly for inclusion,” Jordan added.
Asked whether there is a possibility that the budget would be presented later than this month, Jordan said: “We don’t want to go down that road. The idea here is to improve the accountability process that starts with the budget. We don’t want any budget that will go further into the fiscal year, thereby jeopardising implementation of critical projects that already had their jeopardies in 2015 as a result of elections, late budgets, etcetera.”
CONSULTATIONS WITH PPP
On the issue of budget consultation with the People’s Progressive Party (PPP), Jordan denied excluding the party from the budget preparations. He explained that since the preparation of the 2015 budget, he has extended a hand to the main Opposition party.
“They can’t complain because in the 2015 budget – in August during the consultations, I indicated to them that I have an open door policy where consultations were concerned. It doesn’t have to be a scenario where budget is coming around, I invite them and they come. They could have always picked up the phone and call me if they have anything they wished to discuss and so on. They never made use of that door I’ve opened. The door remains opened,” he said.
He explained that the PPP wants to make demands on him during what is supposed to be budget consultations and he will not tolerate that. “When having consultations, let’s not have demands and so on,” he said.
In a letter dated November 26, 2015, the PPP requested of Minister Jordan several documents noting that the provision of those documents, which include but are not limited to GuySuCo’s COI report, Five-Year Public Sector Investment Programme, latest Bank of Guyana report, submissions made by the 10 administrative regions to the Finance Ministry, IMF Article IV Strategy Report and actual income and expenditure statements to the end of October 2015 and the year in projections, contending that those will aid in “meaningful” consultations.
Jordan said many of the documents requested were already in the possession of the party and many of the issues raised were dealt with before by the government. “If we are going to consult, these have to be meaningful consultations; they are not going to be consultations on issues which we have appropriately and effectively dealt with.”
Thus far, he said, the PPP has not accepted the offer for consultations on the 2016 budget. “No, they didn’t accept the offer… they made the offer conditional,” Jordan told this publication.
By Ariana Gordon