Today Prime Minister Mia Mottley will deliver the Budget for 2022 at 3PM. It will be of interest to pundits for several reasons. It comes against rising oil price caused by the Russia Ukraine conflict which threatens to deplete the foreign reserves government has been boasting, and a cashflow pressured by having reallocate funds to cover pandemic expenses.
Of concern to others – including the blogmaster – will be government’s developmental programs to improve quality of life for Barbadians.
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@David
I was hoping you had a ‘local interpretation’ of the term ‘independent trust’. If @HA were still posting, he might propose it was to be funded by an inheritance tax.
xxxxxx
We knew something had to be done about public pensions. They still remain largely ‘unfunded’ regardless of what body ‘administers them’. The changes will provide an ‘ease’ on annual costs.
xxxxxx
Retroactive taxes are a no-no. I am confused as to exactly what entities they apply to? Is Ansa a financial entity and does it apply to all corporate income or just some?
xxxxxx
The big axe is still to fall.
@NO
As you know many grandiose promises communicated in previous budgets were stillborn. Hopefully in the coming days supported by a vigilant fourth estate more details will be shared.
It looks like the budget speech is over
Allow me to steal one blogger’s favorite song
https://youtu.be/nit7r9Efawc
The Big Central Banks cannot duck rate increases any longer. Inflation is out of control. We’ll see later today if Powell et al have the kahuna’s for a half percent raise. I doubt it. But they need to get up by 1% and fast.
Grasshopper
Good one.
@NO
This is why there is no escalating the decision to remain in the IMF envelope as Avi Persaud shared yesterday?
Unaware of APs comments y’day.
@ Northern
Talk is cheap, and some of us can get it to flow like a standpipe…. But in the end, most of the output is wasted down the drain.
So-called ‘Boards’ in the SOEs in Barbados are nothing but a colossal joke. We have a collection of political appointees who are selected in order to be awarded a few dollars per meeting, and to keep the minister fully informed of all that is happening.
You can easily guess the quality of these ‘Boards’.
Then, just in case any of them break the mold, and become relatively effective, the minister is moved, or gets upset about being upstaged by the chairman, …or get the PM vex …and the ‘Board’ is replaced in the process …with a new set of neophytes.
Meanwhile, the employees doing as they like…
What hold what Board responsible for what SOE what?!!!
steupsss.
@NO
Check VOB Brasstacks podcast yesterday. Post budget analysis.
https://downtobrasstacks.castos.com/episodes/brasstacks-mar-15th-2022
Ok thx David. Will listen when I have time.
@BT
We live in hope?
Though based on the handling of the Senate matter, I cannot state ‘accountability’ is high on this government’s list. They had a straight forward solution, but chose to roll the dice and play politics. And the party supporters fell into line immediately.
A mixed bag of tricks to tackle a health issue placing band aids over health problems
People buy what they can afford
Such issues requires more than placing a tax on sweet beverages but govt stepping out front in leading the way with measures that makes it affordable for families to enhance their quality of life
Hence govt needs to take another look at low wages
Saw mention of the CCJ.
Don’t waste time and money.
Buckle up for the next 3.5 to 5 years.
That is the only game that can play.
It may happen that the outcome and the merit of the case may actually coincide or it may not.
There’s some hopeful news from across the border for Canadians tired of switching their clocks back and forth twice a year.
In a unanimous vote on Tuesday, the U.S. Senate passed a bill, called the Sunshine Protection Act, that could make daylight time permanent next year and bring an end to the long-running bi-annual flip.
Just saw the following: DLP to consider Senate seats
I think some including myself advocated accepting the two seats. My philosophy: You can take cake from a hand and then bite it to hell off. You don’t have to play nice after you get something.
Heck, you can accept and cuss)bite at the same time
But some beggars wanna be choosers Dem proud
Dem slow
Dem ignorant
Dem wasting time
Dem invisible
Planning to sleep to April.
Bet you after April, they go back to bed.
Not waiting on the CCJ.
I only hear w8n to see how Mia gun will de KK thing.
It gun be a thing of beauty.
gun will = gun wuk
TheOGazertsMarch 16, 2022 4:09 PM
Just saw the following: DLP to consider Senate seats
++++++++++++++++++++++++++++++++++++++++++++++++++
Well well!!
So the DLP may end up hand in glove with the BLP in defeating the constitution which they would have had a hand in penning.
Who is going to be the Leader of the Opposition this time?
The youngster In the dlp need to stand up and show off their leadership skill right NOW. Show that they want it and Are not afraid
Once a precedent is set it is hard to reverse
Today 18 tomorrow 13 watch and see
This is the first episode since Barbados became a Republic that has exposed govt handling of putting cart before donkey
Many had pleaded with govt that becoming a Republic govt must put all pieces in order
Govt rejected the most important piece of the puzzle one that was stamped blue and yellow The Constitution
Now left alone for a judge to decided which way is up within a Constitution that govt wanted all and sundry to break away from
U still In That ? Stupes
If the jugde had rykes In ur favor you would still be on it crying down the blå for Trying to go that road and Get ruled against
Swollow the rough scratch and move on. U aint getting any brownie piints on this one now or within the next give years
Had the Judge ruled against the BLP rendering everything done after 2018 null, void and of no effect, she would have effectively ruled against her appointment!!
She should have recused herself.
@TheOGazerts March 16, 2022 4:09 PM “…You can take cake from a hand and then bite it to hell off. You don’t have to play nice after you get something.”
Most sensible statement so far. I give you 10/10.
After the May 2018 revolution, the Constitution only sets non-binding guidelines for our government, which may be overridden at any time. The constitution is, so to speak, a kind of plasticine in the hands of our Supreme Leader, which may be deformed at will.
Glory to our Supreme Leader! The Supreme Leader gives it and she takes it.
@David
AP gave a case for remaining in an IMF program past the current one. I do not know for a fact, but most of these low interest/concessionary financing loans are variable rate. So they will move as Libor moves, and it has moved up by >1% in the last year. And I’m guessing it will move up by at least 1.5% in the next 12 month period. The amount of a loan is less relevant than the cost of carrying it. So even though several of the initial IMF loans and those from other bi/multi lateral agencies were based on very low rates, these may be expected to double.
Barbados will continue to need and benefit from being in an IMF program, IMO.
@NO
Assuming that is the case you make AP’s point because accessing funds outside the concessionary ‘envelope’ will be more expensive. A challenge for Barbados as you know given our high debt level is that we still need to focus on developmental projects to improve quality of life. Operating in the capital market given our ratings makes concessionary financing attractive.
Wish I had known AP was on, I would have asked him about Clearwater Bay.
The social vs financial battle continues.
Public pensions seems it will be a hot spot.
Happy Green Day
First they were 18 seated
Yesterday in Parliament 14 showed up
I guess the Framers of the Constitution understand the minds of the Bajan mentality
Never on time always having excuses not to show up
More from MPs
DLP SUGGESTS PARLIAMENTARIANS PAY PANDEMIC TAX AT A HIGHER RATE
by Sandy Deane
Parliamentarians should have to give up four per cent of their salaries as some Barbadians prepare to pay the one per cent Pandemic Contribution Levy announced in Monday’s national budget, the Democratic Labour Party (DLP) has challenged.
“It’s the only right thing to do,” declared the DLP’s third vice president Ryan Walters as he delivered the party’s response to the 2022/2023 Financial and Economic Statement at a virtual forum on Tuesday evening.
Prime Minister Mia Mottley announced that effective April 1, workers earning more than $6 250 monthly or $75 000 annually will pay the tax at a rate of one per cent of their income, for one year.
In addition, companies in the telecommunications and commercial banking sectors, the retail sale of petroleum products and general and life insurance, with a net income above $5 million in 2020 and 2021, will also have to pay the levy at 15 per cent of their net income from July.
The Pandemic Contribution Levy is projected to earn $120 million.
In the more than hour-long assessment Walters, who described the new tax as “a step backwards”, argued that it was “a definite flaw in how this Government is planning to deal with the current issues of the day”.
“We could have earned that revenue someplace else. So we have another income tax on these people who have their livelihoods too. You can’t say because a man earns ‘X’ amount of money that you can afford one per cent. Well, let the MPs take out four per cent of their salaries because that is the only right thing to do.
“If somebody is earning $6 250 a month and can pay one per cent, a senior minister and a Deputy Prime Minister can afford four per cent,“ he said.
Walters further warned that businesses will pass on the 15 per cent levy to consumers and questioned whether Government had another reason for imposing the tax.
He said: “Is that a start to move up the corporation tax in anticipation of the global minimum tax rate? And what tha will mean for us who have to patronise these businesses?”
The DLP official proceeded to chastise Government for other measures, including the cap on the Value Added Tax (VAT) that will see gas being retailed at $3.99 per litre and diesel at $3.32 per litre effective midnight Wednesday.
He argued that after reaping the sweets from consumers, the Government brought the measure to appease Barbadians, insisting that it should have tackled the excise tax on fuel rather than VAT.
“So the Government is on a moneymaking spree off of fuel. So that is why the Government will tinker with VAT. If they reduce the excise tax and have it on a sliding scale as prices increase internationally for oil, they can slide the price of the excise tax down commensurate with the increase so that the burden is shared equally across increases and when the price comes down as well,” Walters contended.
He urged the Mottley administration to be transparent because Barbadians still do not understand why they are paying the most for gas in this region, even with the new measure.
The DLP official also made a strong case for Government to review the fuel tax which replaced the road tax, as he pointed out that not only motorists but others were also buying fuel at the pumps.
“So the Government is earning substantial revenue because the net is spread above vehicular revenue, in terms of the road tax, so there is an opportunity to reduce the fuel tax so that everybody gets a fair share and the Government still collects the revenue,” he said.
The DLP gave a thumbs up to the renewable energy programme but, as Walters suggested, given the substantial investment in the sector Barbadians should be told what reductions in electricity bills to expect.
“So I am saying to the Government of Barbados that given the aggressive targets of 50 thousand rooftops of solar panels over the next five years, given the significant investment that we are seeing in renewable energy, we should be identifying clear goals to the people of Barbados on where we should be year after year, so that we get to understand what we can understand from the Light and Power Company when we open our bills,”
Walters contended.
He also took the Government to task for capping the cost of freight at $7 350 per 20-foot container and $8,000 for a 40-foot container in what the administration said was a move to shield consumers from rising prices of goods.
The private sector has welcomed the move although it cautioned on Tuesday that prices may not drop as increases on the cost of imported items continues to rise.
Walters charged that Government has given businesses the power to control the cost of food yet again.
“They will use their discretion now to determine if they pass on, when they pass on, and how much they pass on. It is as simple as that. We want to know that the prices are coming downward or stabilising, because there is some level of responsibility and integrity at the corporate level that are passing down the savings through the policies of the Government to you, the consumers and the patrons of their businesses.”
He assured that the DLP would track the movement of prices to ensure that consumers benefit. sandydeane@barbadostoday.bb
About time we had some focus on pension reform.
Pension reform in focus
PENSION REFORM worldwide is always a sensitive issue and can even become a contentious one if not properly initiated.
Any decision, therefore, to revisit public pensions in Barbados must be well thought out and undertaken so that no one is disadvantaged.
Reform of public sector pensions that moves them from a defined benefits plan to a defined contribution is the logical way to deal with the highly underfunded public sector pensions for state-owned enterprises.
While annual allocations are in the Estimates for payment from the Consolidated Fund for civil servants, the quantum will rise as salaries increase. The public purse cannot continue to carry this unsustainable financial load.
There should be a detailed explanation during the ongoing Budget debate to put “meat on the bones” of what Prime Minister Mia Amor Mottley disclosed on Monday during her presentation. The announcement that future beneficiaries of the state pension will have to serve 40 instead of 33 and one-third years for full benefits has far-reaching implications.
The longer stay on the job raises issues of inequality amongst the disciplined services where lawmen and fire officers appear to be at a distinct disadvantage to members of the Barbados Defence Force, who serve a much shorter time.
The new ceiling to earn full benefits also raises issues about the mental and physical capacity of policemen and firemen to effectively undertake field duties at age 60 plus. Both the Police and Fire Officers Associations should pay special attention to the implications for their conditions of employment. Good governance necessitates meaningful consultation with the public on these money matters that touch lives and livelihoods in very fundamental ways. All trade unions and staff associations should have a say regarding the public pension reform and the general public
allowed input in the case of the National Insurance Scheme (NIS). The social security scheme is critical to most Barbadians since it touches them in so many vital ways that they should not be mere spectators in its transformation. Certainly, they want it to be insulated from political interference, a problem that has bedevilled many state-owned enterprises. These matters are not the preserve of a select few since there is a connection between private enterprise and the NIS, while Government’s action on pension reform will be watched and perhaps copied by some private enterprises. To appreciate the interlocking relationships, the details should be revealed of how many employed people in Barbados are not in either state or a private company pension plan and will have only the NIS to depend on in retirement.
The Government should prepare a Green Paper to be followed up by a policy document, as it relates to both public sector pension reform and the overhaul of the NIS, before the Executive’s directives become law.
Pension reform is without a doubt critical to fixing the country’s fiscal problem. Government, however, should first hear the many informed viewpoints to get the best solution.
The new ceiling to earn full benefits also raises issues about the mental and physical capacity of policemen . . . to effectively undertake field duties at age
60 plus.
Source: Nation
The blogmaster suspects the DLP has zero credibility pontificating on economic matters at this time especially before special meeting next month.
22% drop in school enrolment
SCHOOL ENROLMENT HAS dropped by 22 per cent since the 2014-15 period, revealed Minister of Education Kay McConney yesterday.
Speaking during her presentation yesterday in Parliament, she said overall the enrolment was down even though there had been an increase in some parts of St Philip and Christ Church. However, there were marked decreases in St Lucy and other parishes, she said. “Barbados had less persons enrolling in schools and when we look at what is also happening with our population, we are not reproducing at a fast rate. It says to us that there are less and less persons – certainly when we start calculating when these students will leave school – we are recognising that with 22 per cent less enrolment we have taken a hit in our human capital and in our labour force,” McConney said.
The minister said education reform therefore had to go far beyond the Common Entrance Examination as there was also under performance in some areas, disengagement by males and lower levels of certification. “We are seeing a significant amount of male attrition, guys, boys dropping out of school and becoming disengaged and there is an absence of standards whether it is for teaching or other areas where we need to address.
“The reform that has to be done is bigger than just the Common Entrance Exam .. it is looking at a whole range of issues both the opportunities we can now take up based on the trends of the world but equally so those challenges we are facing as a country,” McConney told the House of Assembly. The Member of Parliament for St Philip West said the work Government was undertaking was necessary and important to empowering the country.
“What is important therefore is whatever we do with reform must optimise those who are within the system and those who are able to engage through the multiple intelligence we seek to recognise.”
On a more general note McConney said while Barbados was standing in a moment of uncertainty of what was next considering the COVID-19 pandemic, the Ukraine/Russia crisis, grain shortage and oil prices, it should not
be overtaken by the uncertainty.
Monday’s Budget she said, spoke to the resilience of not only the economy but the people whose concerns were upfront.
Those concerns included the high cost of fuel on which there was a temporary lowering of VAT on fuel and the removal of taxes on some personal care items. (AC)
Source: Nation
A ‘slap in the face’
Banks concerned about Pandemic Contribution Levy
by COLVILLE MOUNSEY
colvillemounsey@nationnews.com
PRESIDENT OF THE Barbados Bankers Association (BBA), Anthony Clerk, says Government’s implementation of the one-off Pandemic Contribution Levy in the Budget, is a “slap in the face” for banks in Barbados.
Clerk said the financial sector was not consulted and they were concerned that the “retroactive “levy goes against good tax principles and sets a worrying precedent.
The BBA president disclosed that while he did not anticipate this levy to be passed on to customers, the association would be meeting next week to discuss the issue and determine whether an appeal was warranted.
“The banking sector is concerned that this tax was sprung upon us without any kind of discussion or notice. We are particularly concerned about the retroactive nature of the tax. Those accounting years have already been closed, audit reviewed, shareholders advised and dividends paid. To go back into those years to apply a tax now is not the way that a good tax system should work,” said Clerk.
He argued that of the $105 million that the levy is expected to garner, it is anticipated that 50 per cent of that would be collected from the banks. He said the move is likely to result in an erosion of profit upward of $10 million for each of the banks operating in Barbados.
“The banks appear to always be an easy target, but we are not the only ones that made some money during the pandemic. So if five million dollars is the threshold, then any company that made profits over that amount should be targeted. We believe that the load or the burden should have been spread across the business sectors and not just the banks, insurance companies, fuel providers and so on.
“This is going to result in a multimillion-dollar hit on our profits for each one of us, maybe upwards of $10 million in some cases. Of that $105 million that will be earned from this tax, I am sure that well over 50 per cent will come from the banks,” he said.
Companies
Outlining the 2022 Financial Statement and Budgetary Proposals on Monday, Prime Minister Mia Amor Mottley explained that the levy would only be in place for a period up to March 31, 2023 and represented a one-off contribution to the more than $1 billion costs of COVID-19 to Government to keep Barbados – its people and companies operating here – safely. She said it was estimated that this levy would raise approximately $100 million, or ten per cent of the Government’s COVID costs.
Where a company with a net income above $5 million in 2020 and 2021 is carrying on domestic business in the telecommunications, retail sale of petroleum products by dealers, commercial banking (deposit taking and finance houses, excluding credit unions) and general and life insurance, then such companies shall be subject to a Pandemic Contribution Levy of 15 per cent of the taxable income per the company’s financial statements for
the fiscal years ended March 2021 and 2022. This levy for each fiscal year is payable in addition to the company’s corporate tax obligation and is not deductible for tax purposes.
However, Clerk contended that the notion that the financial sector emerged unscathed from the pandemic was simply not true and that a more acceptable proposition would have been to spread the pain across all businesses that registered more than $5 million profit during the period in question.
“There seems to be this view that the banks were not impacted by the pandemic when in fact they were. For example, in terms of our return on assets, it was one per cent for those years, particularly for the fiscal year 2020. This was a very low return on assets for any business.
“One has to remember that the banks also supported their customers with a variety of measures throughout the pandemic to ensure that they came out of the pandemic in a good space. In some cases, we are still supporting our customers. It is a bit of a slap in the face of the banks to now come and back tax them for those years. We feel that the tax should have been spread across other industries,” he lamented.
He added: “We don’t know what the ricochet impact will be, because we have not really thought about that as yet. Interest rates on loans are at the lowest [they have] ever been in Barbados – no one is complaining about that. The banks are playing their part in helping to bring the economy back to life . . . but banks seem to always be the whipping horse whenever Government needs to raise taxes.”
Source: Nation
A Parliament yesterday made up.of YES members and not one dissenting word of Opposition
Justice Chase where do.WE go from here
Apparently you have all the answers
Await your legal.and logical response
Oh BTW a footnote 7 members were absent yesterday from the required 21
The budget is nothing other than a renewed declaration of bankruptcy. However, it is not our honourable government that is to blame, but the population. Productivity is far too low, the trade unions are too rebellious. Nothing has changed since 1937. The masses still see the economy as the enemy because they mentally continue to live on the sugarcane plantation.
The only solution is a population exchange: 80,000 civil servants, welfare recipients and rebellious trade unionists must be deported, in exchange we invite 80,000 rich expats and Africans willing to work.
Meanwhile govt is thinking about having plans ways and manners on snatching up unoccupied houses and vacant land to.build housing stock
With a one state govt already in action
That should be easily accomplished
Lawd have merici
@ac
A lil secret, one group only needs the support of a majority of seats to do as they please. 16-14 does it, just as well as 30-0. Only difference is opposing forces now must speak beyond the House.
Your team; Persaud rebuked those 2 on Brass tacks with consummate ease, needs speakers who can avoid the traps set by prior failures when the party ruled. Not easy but necessary.
@ David,
” we are recognising that with 22 per cent less enrolment we have taken a hit in our human capital and in our labour force,” McConney said.”
The void can be filled with Ghanians and some of the Ukranian refugees.
@ NO
Well I lean towards a democratic process that would rather have one opposing voice than none
Actually when Atherley was in opposition I rather much enjoyed his rebuttal on issues which would have been kept closed if there was no Opposition
I suppose your comment was meant to be an excuse taking all things into consideration in Parliament yesterday
Ac
Didn’t Atherley make comments on the budget as he would if LoO.
Didn’t former Sen CF do similarly.
My point was not any excuse for who showed up y’day. The democratic process was the election. It’s done and over.
My point was members of your team need to UP their game, if the response is to be anything more than a long steupse. They keep biting at hooks, which only unearths the past. They need their own agenda.
good or bad
The Jamaica-based GraceKennedy Group, one of the Caribbean’s largest conglomerates, is eyeing further expansion into the Barbados market as it seeks to grow the financial services’ money services segments of its operations.
https://barbadostoday.bb/2022/03/17/conglomerate-eyes-expansion-into-barbados/
30 -0 is a nullity.
Can’t meet the constitutional requirement of the existence of an opposition.
16 – 14 can!!
@NO
Waited patiently for somebody to make the observation re DLP participation.
@Hants
There is a reality we cannot hide from, we have an ageing population who all expect to draw down on pension or a long time. How do we increase NIS contributions in a meaningful way? We need to create job. We need individuals and private sector companies to lead that charge.
AC
Soon u will have Two apposing Voice In the senate. But u like u dobtveven want that
NorthernObserverMarch 17, 2022 3:35 PM
Ac
Didn’t Atherley make comments on the budget as he would if LoO.
Cccc
Your comments speaks well as to why small islands are referred as turd world countries
I speak of a democratic process that lends itself to a complete process
You speak of what is supposed to be sufficient and enough and can do a justifiable job on behalf of people and country
SMH
No. I spoke to how piss poor the response from the DLP spokespeople was.
Lol
NorthernObserverMarch 17, 2022 4:46 PM
No. I spoke to how piss poor the response from the DLP spokespeople was.
Lol
Xxxx
Piss poor Budget lol
Pension Reform as the world tries to do it now is only kicking the can down the road with the warmed over soup gimmicks of every few years increasing the retirement age, changing pension formulas and raising contributions rates while government borrowing from the pension funds for their projects.
Our pension reform needs to completely break the mold
1) For every person currently 50 years or less, change their pension age back tot 65 and have NIS pay an across the board universal basic pension (UBP) calculated based on the cost to cover a one bedroom rental, utilities and food for a single pensioner living alone. Anyone wanting more pension at retirement should seek private pension plans and other investment opportunities during their working years if they desire a higher standard of living.
2) Persons 51 and older would remain under the current arrangements with any shortfalls for the year covered by an unfunded pensions tax. This pension tax would eventually reduce and go away as the numbers under the old arrangement die out.
3) Since healthcare is the biggest money problem for pensioners, work on improving the quality and turnaround time for our taxpayer funded healthcare while bending healthcare costs down through novel approaches e.g. a requirement for medical license renewal could be a minimum amount of pro bono work at government medical facilities or referrals for free outpatient surgical procedures.
Then that should make it easy for the opposers to make a sound case?
If your pal Hal were still posting, surely he could have found a regulation angle.
The blogmaster invites you to join the discussion.