Thursday, May 30, 2019
Taking care of the cents seems to be saving the dollars when it comes to the latest budget.
The headline numbers were that there was nothing major that was new – but it’s the detail that proves most interesting this time around.
Deputy Prime Minister Peter Turnquest, wearing his Minister of Finance hat, told how a line-by-line analysis of each department’s budget has helped to trim spending.
Rather than just letting departments throw in the same budget request as the year before plus a little bit extra for new projects, taking care of the details seems to have shown areas where some spending wasn’t needed. Funds for salaries that were no longer being paid, for example, with members of staff having moved on but the required funding still sitting in the request list.
We perhaps shouldn’t be too enthusiastic in applauding this – it is, after all, a fairly basic piece of management. Add to that the more disciplined approach to real property tax collections and you have an extra $21m coming in at a time when less money is required. No bad combination.
Ahead of the budget, the whispers had been that VAT might go up – no such measure, as Mr Turnquest signaled ahead of time. Indeed, funds are steady enough it seems that tax breaks have been put forward that will help families in particular – refrigerators and stoves, crayons and pencils among the new duty free items, while a reduction in duty on furniture.
Electric bills of $300 or lower or water bills of $50 per billing cycle being made VAT free permanently will also be welcomed by those in that range.
Overall, rather than leaving us all with a sense that the government is still struggling to right the ship as it wrestles through turbulent economic waters, instead it seems to be steady as it goes for the good ship Bahamas.
There are valid concerns – PLP Deputy Leader Chester Cooper certainly has solid questions about the projected extra income from VAT and the likelihood of bringing in $250m a month according to projections for the last two months when only $190m on average has been raised for the first ten.
However, his cry that the budget is an “epic failure” is the kind of overblown hyperbole that makes people roll their eyes at politicians. Indeed, were he to glance across at the mess that transpired over the BAMSI fire under his leader’s tenure at Ministry of Works, he might in his heart applaud the more detailed look at departmental spending advocated by Mr Turnquest.
More, in saying the government might have hit its revenue targets if not for “reduced taxes” for special interests and a VAT refund to “special interests in Grand Bahama”, he’s essentially admitting that the general shape of the economy is on course barring those areas.
We hope this is the shape of things to come – and that the government doesn’t lapse into politically motivated giveaways as we come closer to the next election.
Now that the ship is sailing more smoothly, let’s keep it that way.