A $1,000 allowance for police officers, assistance plans for CL Financial and Hindu Credit Union depositors and an amnesty on tax penalties took top billing yesterday in Finance Minister Winston Dookeran's 2010/2011 budget package. But under Dookeran's budget, litterbugs would have to cease and desist–or risk fines which have been increased 100 per cent. And the Alutrint and rapid rail projects by the previous PNM administration have also all been officially axed along with the property tax. Dookeran presented the new People's Partnership Government's $49 billion budget at the Red House yesterday in a two-and-a-half-hour presentation on the theme: "Facing the Issues–Turning the Economy Around."
Saying the budget was driven by the need to fulfill the people's expectations, Dookeran added: "This budget lays the foundation for a major shift in our developmental approach and adopts a fiscal stance that is stable, people-centred and responsible. Our mandate not only expressed the people's desire to be heard, it is also a mandate to change course," he said. "We must now usher in a new momentum for growth and a fairer distribution of income and opportunities." The People's Partnership first budget came in at approximately $5 billion more than the previous PNM administration's $44.3 billion budget for 2009/2010. Total revenue from the People's Partnership budget is estimated at $41.2 billion.
An overall fiscal deficit of $7.7 billion is projected. Deficit financing will be met by domestic as well as multilateral and other external sources. Dookeran said T&T benefited from higher energy prices than expected in 2010 and registered economic growth of 2.5 per cent this year. For fiscal year 2010, Dookeran projected a deficit of 3.5 per cent. Announcing incentives for police officers, Dookeran said a monthly Special Duty Allowance of $1,000 would be paid to more than 7,000 officers effective next month.Tax on this will be waived. Tackling the CL Financial issue early in his presentation, Dookeran said the matter was handled badly by the authorities from the start and was a "colossal inexcusable, multi-billion-dollar mistake."
He said the People's Partnership Government must now "clean up the "mess". Dookeran said a high-level team of experts "critically analysed the situation" and advised on a course of action to stop the drift and indecision, bring order to the Clico and British American companies involved and take immediate action to drive recovery in a prudent, structured manner. Dookeran outlined the five-pronged plan. This would aid small depositors, review CL Financial and its subsidiaries, introduce measures–including divestment of assets–to reduce CLF's debt and restructure the group. Small depositors would receive initial partial payments of a maximum of $75,000. Dookeran outlined a similar four-point plan to assist 160,000 HCU investors.
Depositors and shareholders would be entitled to $75,000. Depositors above $75,000 will be paid in equal annual instalments and shareholders will be required to sign over their rights to HCU assets to the Government. The Government also intends to hold litterbugs highly accountable via a 100 per cent increase in littering fines from next month. Individuals and corporations who litter will have to pay $1,000 and $4,000, respectively. Material falling or thrown from a moving vehicle will cost the owner or the corporation $2,000 and $4,000 respectively. Depositing litter on another person's premises without their consent carries a $2,000 fine. Fines have also doubled for littering with material deemed a health hazard, failing to comply with clean-up orders and leaving derelict vehicles in public places.
Bidding to improve tax collection, Dookeran offered an amnesty on tax penalties and interest for late filing of returns and late payment of income, corporation and Value Added taxes, business, levy, environmental plus lands and building taxes. The amnesty applies on outstanding tax liabilities for years of income up to 2009 and extends up to May 31, 2011. Dookeran said the Government expects to settle Public Service wage negotiations by year-end. The GATE programme will be expanded with "strict" enforcement of measures to stop programme abuse. On the rapid rail project, Dookeran said feasibility studies and design plans alone cost $565 million to date–yet no viable economic plan had emerged.
He said the project's expected capital cost would have been $22.5 billion. Cancelling the project, he said Government will design an alternative transport programme. Dookeran said the Alutrint smelter project will also cease following public outcry, health and environmental risks as well as concerns over viability. Debate continues from 10 am next Tuesday with Opposition Leader Keith Rowley's reply.