MINISTER of State for Finance Michael Halkitis has thumbed his nose at former prime minister Hubert Ingraham, virtually telling him to mind his own business as the PLP are now in charge of the country’s finances.
Mr Halkitis said that Mr Ingraham was advising the Christie government to do something that he himself had not done during the FNM’s term in office. Mr Ingraham had advised Mr Halkitis that government expenditure should be limited in the face of a growing deficit.
Mr Halkitis’ response was triggered by Mr Ingraham’s comment that the PLP’s $700 million deficit projection was inflated. In Mr Ingraham’s opinion the PLP government should not have increased expenditure, but should have cut back on spending.
Mr Halkitis rejected the advice because, he said, that when Mr Ingraham was in office he failed to meet his own projections in a failing economy.
“In 2008 to 2009 they forecast that they would collect $1.574 billion,” said Mr Halkitis. “Actually they collected $1.331 billion, you collected $242 million less than forecast. Now with the recession you would collect less money than you would have expected.
“Did you take your own advise? That following year, did you say I’ve got to cut spending because my revenue is not performing? No. Because in 2009-2010 you raised your spending to $1.729 billion,” Mr Halkitis said.
Both true and false. Mr Ingraham cut spending where he could, but he spent — and in the case of the roads overspent — where necessary to keep as many Bahamians employed as possible. The world economy had collapsed and all nations were going deeper into debt to prevent total collapse. So was the Bahamas.
However, what can be said for the Ingraham government, is that at least Bahamians can see where every penny was spent.
There was much yelling and screaming about the over expenditure on roads, but as one limousine operator commented last week, “These roads reflect the genius of a man who has tremendous vision for the future.” After all the grumbling, the new roads are the talk of the town, both by Bahamians and visitors.
The taxpayers’ money was not spent foolishly. As Mr Ingraham said at the time, investment to create employment was to go into improving the island’s infrastructure in readiness for the day when the economy would revive and the tourist industry would once again flourish. Mr Ingraham cut back where he could, then spent in preparation for the future. It was money well spent. Go, take a look, and see for yourselves.
Not so, the PLP. And this is where if they do not take Mr Ingraham’s advice, they will ignore it not only at their own peril, but at the country’s peril.
The way the Christie government is spending money is so alarming that in our opinion it hastened the Standard & Poor warning that “the negative outlook reflects the possibility of a downgrade if the recently-elected Progressive Liberal Party government does not put forth a medium-term plan to address the higher deficits and to stem the rise in government debt to GDP.”
Shortly afterwards the country was downgraded.
On coming to power, the Christie government increased the Cabinet, instead of shaving an over bloated civil service, it added jobs for party supporters — ZNS that can hardly pay its way, took on more staff, the story of NIB is well known, the increase in staff at the Ministry of Financial services can hardly be justified, and so the story continues.
While Mr Ingraham concentrated on the country’s infrastructure, it would seem that the Christie government was busy creating government jobs for party supporters.
Let’s take a look at the Christie Cabinet — at 21 members it is the largest cabinet in the history of the Bahamas. When the Ingraham cabinet dropped to 18 on the resignations of Branville McCartney and Kenneth Russell, Mr Ingraham did not replace them, because he believed that even with 18 his cabinet was too large.
However, eyebrows were raised when, in the depth of a depression, Mr Christie increased the cabinet to 21, he also increased the number of his parliamentary secretaries. Of the 21 ministers, 16 were substantive at a salary of $66,000 and five were ministers of state at a salary of $60,000. In addition to their salaries, those who were members of the House each received their House salary of $28,000. Each minister (both substantive and ministers of state) had a $5,000 duty allowance. In addition to this each of them has a government car, chauffeur, office, staff and personal assistant. And then there are the parliamentary secretaries. All of this baggage at a time of a deep recession.
How can Mr Halkitis justify this — only one of many examples of what is going on in this government? How can he afford not to take the advise of the former prime minister?