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Borrowing our way out just won’t work

Tuesday, January 10, 2017

Most senior financial practitioners I have spoken to cannot see total Government revenue topping 30 billion dollars in 2017, while we are budgeted to spend 53 billion dollars. Faced with a similar situation two years ago, the Government of Suriname took the courageous decision to cut their budget in half, and while this decision has caused a degree of early suffering for their citizens, at least they are now back to living in the real world.

We in T&T are not. We are simply living in dreamland with a hugely unsustainable budget deficit for the past two years while we continue to borrow our way to the gates of hell. Meanwhile labour unions are lining up to receive wage settlements predicated on an economy that disappeared three years ago.

To highlight how absurd some of these demands are, an office cleaner at Petrotrin has a higher base salary than a cabin crew purser on Caribbean Airlines. When next you speak to the senior officer of a leading bank branch manager at a shopping mall, understand that he or she has a salary that is on par with a truck driver at Petrotrin.

Turning to the police service, a constable in T&T makes four times the salary of his counterpart in Guyana!

The rationale for these very high salaries compared to our Caribbean counterparts no longer exists and all parties need to fully digest the new realities here for us to collectively chart a successful way forward.

Furthermore, Petrotrin has debt it can never repay and is losing hundreds of millions of dollars annually, while it has more than twice the number of employees needed to run the refinery.




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