DA­REECE PO­LO

Se­nior Re­porter

da­reece.po­lo@guardian.co.tt

Gov­ern­ment ex­pects an­oth­er dif­fi­cult year ahead as it con­tin­ues to as­sess the full ex­tent of Trinidad and To­ba­go’s fi­nan­cial oblig­a­tions while try­ing to cre­ate room for eco­nom­ic re­cov­ery.

Min­is­ter in the Min­istry of Fi­nance Dr Kennedy Swarats­ingh said the ad­min­is­tra­tion an­tic­i­pat­ed that its first two years in of­fice would be the most chal­leng­ing, with the econ­o­my ex­pect­ed to be­gin re­cov­er­ing af­ter that pe­ri­od.

But he said the Gov­ern­ment is still work­ing to de­ter­mine the full ex­tent of the coun­try’s in­debt­ed­ness, in­clud­ing out­stand­ing bills dat­ing from 2016 to 2024.

Swarats­ingh was speak­ing at a pre-bud­get con­sul­ta­tion host­ed by Ca­roni Cen­tral MP David Lee on Tues­day night at his po­lit­i­cal par­ty of­fice. Res­i­dents raised con­cerns rang­ing from the con­di­tion of roads and drains to the com­ple­tion of pri­ma­ry schools, re­pairs to pavil­ions, sup­port for farm­ers and so­cial wel­fare.

He said the fi­nan­cial pres­sures fac­ing the Gov­ern­ment were af­fect­ing even ba­sic in­fra­struc­ture works, point­ing to the coun­try’s wide­spread pot­hole prob­lem as an ex­am­ple of projects for which fund­ing had been dif­fi­cult to find.

Those pres­sures are set to in­ten­si­fy as re­cent­ly set­tled wage agree­ments, fol­low­ing the gov­ern­ment’s elec­tion cam­paign promise of a 10 per cent in­crease to trade unions last year, be­gin to take ef­fect and add to re­cur­rent ex­pen­di­ture.

“As we set­tled many of these wage ne­go­ti­a­tions, many of the new salaries are now kick­ing in for the month­ly paid. And in the next fis­cal year, some of the salaries for the dai­ly paid that we have set­tled will have to start com­ing in. Of every dol­lar the gov­ern­ment spends, 94, 95 cents of every dol­lar goes in­to trans­fers, sub­si­dies, salaries, pen­sions and debt re­pay­ment. So, in oth­er words, a small por­tion of that dol­lar re­mains avail­able to gov­ern­ment.”

The warn­ing comes as the gov­ern­ment pre­pares to present its 2027 bud­get with lim­it­ed fis­cal space and a grow­ing list of ex­ist­ing com­mit­ments.

Swarats­ingh said the ad­min­is­tra­tion would have to man­age those pres­sures while pur­su­ing an eco­nom­ic re­bound, sug­gest­ing that the room avail­able for new spend­ing re­mains nar­row.

Lee, mean­while, said the fi­nan­cial po­si­tion in­her­it­ed by the gov­ern­ment had been se­vere enough to raise the pos­si­bil­i­ty of T&T seek­ing as­sis­tance from the In­ter­na­tion­al Mon­e­tary Fund.

He cred­it­ed ne­go­ti­a­tions un­der­tak­en by Prime Min­is­ter Kam­la Per­sad-Bisses­sar and her ad­min­is­tra­tion over the past 18 months with keep­ing the coun­try away from that po­si­tion.

“As a mat­ter of fact, giv­en the fi­nances of this coun­try, I don’t want to say it, but if we did not man­age it as the ho­n­ourable Prime Min­is­ter and her team have been man­ag­ing it, we might have end­ed up in the IMF. And I leave that there at this point in time. But we are not there. We are nowhere close to be there be­cause of the ne­go­ti­a­tions and what we have been do­ing over the last 18 months.”

But the gov­ern­ment’s fis­cal chal­lenges ex­tend be­yond its im­me­di­ate spend­ing com­mit­ments. Swarats­ingh al­so warned against con­tin­ued de­pen­dence on the en­er­gy sec­tor, which he said ac­counts for about 35 per cent of GDP.

He said the gov­ern­ment was look­ing to agro-pro­cess­ing, small and medi­um-sized en­ter­pris­es and oth­er sec­tors to di­ver­si­fy the econ­o­my and cre­ate new op­por­tu­ni­ties for growth.

Against that back­drop, Lo­cal Gov­ern­ment and Rur­al De­vel­op­ment Min­is­ter Khadi­jah Ameen said the ad­min­is­tra­tion had al­so re­duced spend­ing as­so­ci­at­ed with min­is­ters’ over­seas trav­el and of­fi­cial func­tions.

Ameen said the gov­ern­ment had been forced to make sac­ri­fices be­cause of what she de­scribed as the mis­man­age­ment and cor­rup­tion in­her­it­ed from the pre­vi­ous Peo­ple’s Na­tion­al Move­ment ad­min­is­tra­tion, com­pound­ed by the wider eco­nom­ic chal­lenges fac­ing the coun­try.

She said the ad­min­is­tra­tion’s po­si­tion was that pub­lic funds should be di­rect­ed to­wards cit­i­zens rather than what she de­scribed as non-es­sen­tial ex­pen­di­ture.