P.M. presents “Facing, Fixing, Moving Ahead” budget
There was standing room only in the National Assembly building on Independence Hill this morning as Prime Minister Said Musa presented his government’s budget for the fiscal year 2007 to 2008. And as News Five’s Janelle Chanona reports, Musa’s “Facing, Fixing and Moving Ahead” speech also contained bold promises designed to curry favour with the electorate in the run-up to general elections in 2008.
Janelle Chanona, Reporting
Prime Minister Said Musa prefaced the presentation of his administration’s new budget by reporting on the country’s economic performance in 2006.
Prime Minister Said Musa
“Real G.D.P. growth was around four percent for 2006. The combination of tight fiscal and monetary policies and strong performance by exporters of goods and services led to a significant improvement in the balance of payments position during the year. The annual labour force survey showed that unemployment fell from eleven to nine point four percent largely due to the vibrancy of the services sector, especially tourism. The consumer price index rose by four point three percent. All commodity groups were affected, especially transport and communications, rent, water fuel and power.”
“Revenue collections for the current fiscal year are expected to exceed targets in all major revenue categories. This reflects two major factors. First, economic activity as measured by nominal G.D.P., grew faster than was projected at the start of the budget year. This is reflected in a revised projection of nominal G.D.P. of two point four-two-eight billion dollars as compared with the original projection of two point two-one-four billion dollars. This improvement had a positive impact on revenue collections. Secondly, strengthened tax administration also improved revenue performance. Total recurrent revenue was budgeted at five sixty-two point nine million dollars. By the end of the fiscal year, total recurrent revenue is expected to reach five eighty-two point four million dollars, almost twenty million dollars above target. Tax revenue is projected to exceed targets by fourteen point nine million. Of this, taxes on income and profits at one thirty-six point three million dollars are expected to be close to the approved budget of one thirty-five point one million, and taxes on property at five point three million will be just below the approved budget of six point one million dollars.”
The darkest cloud over the Musa government continues to be the country’s billon dollar external debt, but this morning the Prime Minister spoke of the restructuring efforts that have become their silver lining.
Prime Minister Said Musa
“Madam Speaker, the results are now in, the Government of Belize has successfully restructured the commercial debt of Belize. … In total, ninety-eight point one percent of the total commercial debt has been restructured. [Audience applauds] Madam Speaker this success rate is virtually unprecedented in the history of sovereign debt restructuring. The restructuring has resulted in an improved outlook for the future. Belize’s debt service profile has been transformed from one that was unsustainable to one that is certainly sustainable. There are no more spikes reflecting imminent bullet payments or put options. The new debt service profile provides Belize with considerable a net cash flow relief between 2007 and 2015, amounting to U.S. four hundred and eighty-one point five million dollars.”
“At the end of the day however, servicing Belize’s debt will in fact be sustainable as long as prudent policies continue to be maintained. This government has therefore pledged to our creditors and to the Belizean people that it will continue to manage its finances in a responsible manner. This will be reflected in the draft estimates put before this Honourable House today.”
In presenting the new budget, the Musa government says it has created ambitious but achievable goals.
Prime Minister Said Musa
“It is a budget that ensures our country continues to grow in a steady sustainable way; a budget that will generate more and better paying jobs; a budget that invests more in human capital of Belize through education and training for more productive living; a budget that tackles the challenges facing families right now by creating healthier and stronger communities; a budget that invests in our nation’s economic infrastructure; and a budget that still ends the year with a much reduced deficit and another primary surplus.”
“As in the past two years, the draft budget for the coming fiscal year continues to emphasise health, education, and poverty alleviation. In addition however, this budget gives greater priority to the implementation and maintenance of economic infrastructure than in previous years.”
In the part of his speech titled “The Plan of Action for the Future,” Prime Minister Said Musa unveiled his administration’s boldest promises for the new year.
Prime Minister Said Musa
“In this new fiscal year, education accounts for twenty-five percent or one hundred and forty-three million of the recurrent budget, with an increase of seventeen point three million dollars over last year’s expenditure. We are indeed a nation unquestionably committed to education. The goal is for every child to have access to primary and secondary education. This year we are going further. Government will provide free basic primary school textbooks in Mathematics, Science, English, and Social Studies to all needy children.”
“The recurrent budget for the Ministry of Health has been increased from sixty-two million dollars to seventy-six point seven million, a twenty-four percent increase. This includes an allocation of four million dollars to allow the expansion of N.H.I. to the rest of the country.”
“The building of more low income houses with repayments not exceeding two hundred dollars per month will be stepped up. Further steps will also be made to reduce mortgage payments on all social housing; that is low income houses to an affordable rate not exceeding two hundred dollars per month.”
“Government will shortly be reconvening the Tax Reform Committee to advise on several matters. First, the Tax Reform Committee will be asked to review proposals to increase the threshold of income tax to twenty-four thousand dollars and reintroduce tax exemptions for charitable contributions.”
“Government is presently working on a project at Mile twelve on the Northern Highway to provide on thousand more house lots. Removal of the ten dollar service charge on electricity bills by B.E.L. will be effected by the end of the first quarter of this fiscal year.”
“Belize is back on track. The path ahead is clear now. The horizon has the glow of hope and the promise of a brighter future. As in life, there will be new challenges to face; the work of reform must continue. Embracing change and seizing opportunities for innovation and progress must be our guiding principles. Some people may say, “Sorry that’s too ambitious, sorry that is just rhetoric, sorry it can’t be done. I say Belize is not a sorry country; we are not a sorry people. It can be done if you have the will, the vision, the courage and the determination to do it. Together we can. After all we are living in a good country.”
[Audience applauds]
Dean Barrow, Leader of Opposition
“Of course the government will try its very best to keep some of the promises and I would expect that the sacrifices will be made so that some of the promises can be kept. But the general atmosphere that all sorts of this will happen and happen copiously and abundantly and comprehensively, I believe the promises that go that far will fall flat. One or two things will happen, but the bottom line is those will not be able to offset the tremendous increase in the cost of living that this budget confirms. I believe that’s going to continue to go up during the upcoming financial year. And as I said, nothing can compensate for the total lack of credibility that the government has and the ever deepening river of scandal which is threatening to drown the government.”
The budget debate has been set for Thursday, March fifteenth at the National Assembly Building in Belmopan. Reporting for News Five, I am Janelle Chanona
Today the House of Representatives also approved a twelve point six million U.S. dollar loan from the Caribbean Development Bank to pave the road to Placencia village.
