GG outlines Mission Critical plan to save ailing economy
Governor General Dame Sandra Mason delivering the Throne Speech at the State Opening of Parliament in the Senate Chamber today. (B.Hinds/BGIS)
The official Opening of Barbados' Parliament brought with it the sobering reality that there are tough days ahead for Barbadians as government implements its Mission Critical plan to stabilise the economy.
However, Governor General, Dame Sandra Mason made it clear government will ensure the burden of economic adjustment is shared fairly across the board and does not fall disproportionately onto workers.
The GG shared the details of the Mission Critical plan during the Throne Speech in the Senate Chambers of the House of Parliament on Tuesday.
She said the country continues to face enormous challenges including excessive taxation, high levels of debt and inadequate foreign reserves to safeguard the Barbados dollar. On top of this, infrastructural and environmental issues continue to exasperate the problem.
Dame Sandra said 20 Mission critical steps, to be implemented over the next six months, must be taken with immediate action to resolve the economic issues, noting "there will be severe consequences if these matters continue to be ignored".
She said government is to present a balanced budget by 2019 with no new financing requirements and will be keeping Barbadians fully informed.
Some of the key areas of the Mission critical plan include seeking the cooperation of domestic and external creditors and the balance of payment support of the International Monetary Fund (IMF), encouraging Barbadians to hold the faith while the adjustment measures unfold.
"Even as we propose to enter into a programme with the IMF, we will keep faith with our citizens and we ask them to keep faith with us."
She said government remains committed to the fixed exchange rate and preserving the value of the Barbados dollar and therefore will pursue policies to restore foreign reserves to at least 15 weeks of cover.
With the understanding that over-taxation cannot lead to economic growth, Dame Sandra said government will do as promised in abolishing the National Social Responsibility Levy (NSRL), road tax as well as repealing the requirement for tax clearance certificates. The Mission Critical plan also includes the repeal of the Solid Waste Municipal tax and the return of VAT to 15 percent within 18 months.
Dame Sandra highlighted the high levels of debt owed to citizens, corporations and institutions which amounted to $1.7 million at the end of September. Those who are owed include the University of the West Indies, UCAL, sugar industry and the National Insurance Scheme as well as arrears of income tax, and VAT refunds to citizens and businesses.
"We will thereafter work to establish a structure for regular on-time payment of money owed by Government to citizens and corporations. When the system is established and functioning well, Government will be required to pay interest or penalties for late payments."