Howai budget not just the mixture as before
Finance Minister Larry Howai's reminder that he had three months to deliver the 2012-2013 Budget added a telling dimension to yesterday's edition of the annual exercise. Mr Howai, who three months ago had been a top bank executive, not publicly identified with the People's Partnership, presented a statement lacking in political hits, targeted references, or hook lines.
It was also noticeably shorter than any recalled from recent predecessors. Declining to upstage Cabinet colleagues, the Minister pointedly left matters for later fleshing out by other portfolio holders.
This less politicised Budget speech will possibly also prove less provocative, something that may condition responses of the parliamentary opposition. Unlike the practice with People's Partnership speakers, Mr Howai, largely avoided critical reflection on the previous PNM administration.
Still, the Finance Minister unmistakably affirmed the positives about the T&T economy. Fundamentals have been strong; its performance has shown resilience and stability; growth has in 2012 occurred at 1.2 per cent, and is projected to reach 2.5 per cent; inflation has held as 5.6 per cent; and full employment prevails.
The T&T economy does not, in the judgment of its Finance ministerial manager, qualify for austerity measures. "The current condition of the global economy requires us to be measured and watchful," he said, opting for "a judicious mix of measures" that would "provide a strong stimulus boost to the economy aimed at accelerating the growth momentum".
Nevertheless, deficit budgets are what T&T has to live with. Mr Howai's own first budget assumes spending $7.69 billion more than revenue—a deficit pattern, he predicts, likely to hold until 2016.
The Minister sounded confident about his ability to bring closure to the agonies occasioned by the CL Financial and Hindu Credit Union meltdowns. He noted the $19.7 billion cost incurred represents 13 per cent of current gross domestic product. He also claimed to have taken "proactive action" to end industrial relations disputes that have dragged on over years.
The word "consultation" recurred throughout yesterday's address, reflecting a concern by the Finance Minister to engage those affected in the design and implementation of solutions. Consultation should help in the reintroduction of a property tax regime, which had been sidelined in 2010 by the incoming administration.
Property taxation, always waiting in the wings, is now due to return, no doubt with all controversy renewed over why it had been stopped in the first place. But the whole taxation system is up for review, Mr Howai said, including even fees charged for government services.
"There must be widespread consultation," he said, raising expectations that may not now be disappointed. Such consultation has not, however, noticeably preceded the reduction of the fuel subsidy to the extent of immediately increasing the price of premium gasoline.
Higher gasoline prices, after just three months of a Howai Finance Ministry, should lead motorists, and everyone else, to expect from him something other than the mixture as before.