There can be no doubt that political systems are the mechanism through which binding decisions are made. In a similar vein, some political scientists suggest that politics is also about who gets what, when and how. This is why getting an electoral majority is important: it allows an administration or ruling party to make laws and set the policy direction, especially through the national budget. Indeed, the national budget is a key instrument for implementing government policy, as it determines which initiatives are funded.
A budget speech is a political device, a tool to win public support for the direction and tone an administration seeks to set. However, there is often a significant disconnect between what is presented in the speech and what is ultimately delivered; budget arithmetic is the reality that frequently undermines ambitious policies.
This happens because much of government expenditure is “hardcoded”, meaning that established bureaucracies have to be funded. Therefore, every administration must create “fiscal space” to fund new initiatives if it wants to make lasting change. This means that expenditure in some areas may have to be cut to provide the funds to facilitate priority areas. If not, new taxes must be implemented or new sources of revenue found. A strong, prosperous economy is the ultimate test of political performance. When the economy is performing well, there is a greater chance that most people will do well.
The United National Congress administration marked its first year on April 28, noting successes while admitting room for improvement. Its main task is to outperform the previous administration by demonstrating clear progress. Any administration is judged on key areas: crime and national security and the economy’s performance.
There are objective performance measures and hard data that can be used, rather than vague evaluations based on optics. The murder rate is generally considered the most reliable and critical variable for comparing the crime rate over time or between countries. The most important criterion here is not that the rate declined over one year. What the country wants is a permanent reduction in the crime rate, which means a downward-sloping trend over several years. This will improve the citizens’ perception of personal safety.
This requires a multi-pronged approach to ending violence in all its forms. A state of emergency cannot meet this goal. Nor will targeted zonal emergencies. These are temporary measures and must be supplemented with other targeted interventions.
Achieving sustainable positive economic results remains a key goal. Higher energy prices arising from the Middle East conflict are expected to boost the economy, but this is due to luck rather than policy. The Minister of Finance acknowledged this at the recent IMF meetings in Washington. Similarly, Shell and BP negotiations in Venezuela have sent positive signals, which may benefit the T&T energy sector. However, the country will do well to remember that Dragon is a 40-year-old project and Manatee took 20 years to reach this point.
The mid-year budget review will better show how well the minister has managed his sums. Moreover, the Auditor General again gave a qualified report on the 2025 Public Accounts. The Auditor General also noted that the Exchequer Account was “overdrawn” by $51.9 billion, with servicing the Public Debt accounting for 19.17% of total expenditure and the national debt continuing to rise. The high debt service percentage is crucial, as rating agencies will soon evaluate the country’s ability to pay its debts and international interest rates are rising. The results of these credit rating evaluations could significantly affect the nation’s ability to borrow.
