Tobago should get at least another billion dollars in the upcoming budget to be used as a stimulus.
This is according to the deputy political leader of the island’s second major political party and the man vying to be its next Chief Secretary, Farley Augustine.
In an interview with the Business Guardian, Augustine said the call for an additional billion dollars was based on the upper limit of the recommendation of the dispute resolution commission that Tobago get between 4.03 per cent and 6.9 per cent of the national budget.
He said in the past successive governments have kept to the lower limit of the recommendation and with the elections due shortly for a new Tobago House of Assembly he expected the central government to give the island more funds.
“Firstly, I can tell you that I am hoping and expecting, that, at least they will attempt to bribe Tobago by giving us closer to the higher percentage of the dispute resolution commission requirements.... And the truth is if Tobago is to meet significant recovery from the what has happened in covid then we need to get more towards a higher percentage, not so that it could be used in the way Tracy and those guys have been using it, but to use in a manner that will allow for the stimulating of the economy of Tobago,” Farley told the Business Guardian.
Q: “You talk about to 6.9 per cent, by my back of the envelope calculation you are talking about at least a billion dollars more than Tobago gets now, is it that what you are thinking as well?”
A: “Yes. I am. And if you notice successive THA budgets, you know normally we will meet in June and we will make a budget for Tobago and send it down to Trinidad, all of those budgets tend to be somewhere in the region of four billion dollars.
Almost always, when we look at what we have always received, is usually a bit over two billion dollars to the THA for recurrent expenditure and for capital development and so what I’m asking for is actually no different from what PNM Tobago has asked for repeatedly over the last, almost 20 years. I will admit though that PNM Tobago has not been good stewards of the resources given to Tobago.”
Last year the THA received $2.134 billion in the budget which represented 4.3 per cent of the national budget.
In July the Assembly’s Finance Secretary Joel Jack told a news conference that he will submit a budget proposal of $3 billion to Minister of Finance Colm Imbert, to cover THA spending for the next fiscal year.
This is essentially a billion more than last year’s allocation.
Jack, who made the announcement during a post executive council media briefing, said the figure was derived after consultations with various interest groups and divisional heads.
Guardian Media tried to reach Jack on innumerable occasions but all calls to his mobile phone remained unanswered and up to press time the calls were not returned.
Augustine said the situation was dire in Tobago and money was needed from the central government to ameliorate it.
“I could send you a survey that was done by the Tourism Hospitality Association and among its membership, close to 75 per cent are saying that they don’t think they will be reopening post-covid.
“So Coco Reef would be the only one. Tourism is the largest industry in Tobago outside of the THA government sector. It means we are in for a very very rough recovery period and also there is the need to rebuild the economy in Tobago.
“This requires a lot of capital input from the government sector and it cannot be used just to win an election. It has to be very purposeful, it has to be invested in the right places. Tourism being one of those and I mean, unfortunately the stimulus that was available to us, made available to us by the government have not really gone anywhere.”
Augustine said as an example of the challenge facing businesses on the sister isle, only about 28 per cent of the properties in the same tourism survey were successful in getting a moratorium from the bank on payments.
“We talking about hotels and bed and breakfasts and AirBNBs and so on that have been closed for more than a year and only 28 per cent were able to get the bank to hold off on demanding the repayments. We also have another issue regarding the reserve capacity from T&TEC.
“Hotels are being closed practically almost indefinitely yet they have to pay this reverse capacity fee. So think of a payment of $30,000 when the month comes and there is no income. The lights is off, the rooms are locked up. There is no staff but you still have to pay that reserve capacity,” Augustine lamented.
He argued that there are some areas that have been neglected by the THA in the last 20 years that if elected his administration will have to pay some attention to.
“So, why am I telling you all of this? I’m telling you all of this to say that really and truly Tobago needs some sort of stimulus injection, that is above the minimum requirements of the dispute resolution commission’s, ruling, which is the four point zero, three per cent.
“We need closer to the 6.9 per cent. How that will be squared, with the national budget, is another question because the same way we are looking for that kind of stimulus injection from the central government I believe Trinidadians are looking for a similar kind of injection as well. And generally, the entire economy is in shambles and we have been running up deficits for a while, but you can’t really see the tangible benefits from the deficit budgeting that we have been doing. So we are in quite a pickle,” Augustine lamented.
Asked if he became the next Chief Secretary if he will fix the issue of the THA crowding out the private sector and employing 60 per cent of the workforce.
He said, “ I actually have a completely different approach to what exists at the moment.
“So much so much for that I have been accused of desiring to fire people in CEPEP and so on, which is the furthest thing from the truth because I just believe in having the government sector even more productive than it has been. I also have proposed a step-by-step measure by which we can wean people from the public sector.
“So I have actually developed a plan, which I have placed before Tobagonians already which is that we can begin to stimulate private sector goods by encouraging entrepreneurship, encouraging those who are employed with the THA to become entrepreneurs.”
He added, “In the end we do training, and as we go along to get your business started and you receive your salary as normal, but you get to spend some considerable time away as you find your business.
“In year two we only expect 50 per cent of your time working in the THA, 50 per cent with your business. By year three we need to wean you off completely to your business. But every single year, we reduce the amount of salary given to you.”
He said by using that kind of approach we will give people an impetus to leave the public and move into the private sector.
Additionally Augustine said what has to be done is to empower the private sector to do some of the very things the THA is doing. The THA at the moment he noted competes with the private sector in basic things like the provision of animal feed to the farmers.
“The THA should not be a direct competitor with the private sector. I don’t even agree with THA running hotels. So I would have never opted to the purchase Manta Lodge and Sanctuary Hotel.
“Manta Lodge is under construction at the moment, finally after all these years, but I really and truly do not believe the THA should be getting involved in an industry to compete directly with the private sector. I really don’t think that should be the case. So my approach is a lot more radical.
“My approach is not to just go in and fire everybody in the public sector, but my approach is to say look let us find a way to wean you away from the public sector and make you confident enough to run your own business or to be employed in the private sector.” Augustine ended