NASSAU, BAHAMAS — The government’s 2020/2021 budget may be “too short focused”, a well known banker has opined, adding that with significant borrowing being undertaken it was also “too silent” on debt management.
Gowon Bowe said: “This is a scenario that we know is going to be over a period of time, 24-36 months etc and I think the budget needs to be reflective of that. My objective criticism is that it is too short focused. It has to give us the confidence that they are thinking about multiple years.”
Bowe said: “Apart from that we need some details about the vision of what they see over the coming cycles because ultimately it was silent on debt management. If you are talking about having to borrow the largest amount of money that you have ever had to in the history of The Bahamas in a single period we need details on how we are going to be able to pay it back, a debt management strategy.”
Deputy Prime Minister and Minister of Finance K Peter Turnquest yesterday tabled notice of a resolution which will authorize him to raise by way of a loan or loans $1.34 billion.
Turnquest said that the fiscal deficit is budgeted at some $1.3 billion, or 11.6 percent of GDP for the upcoming fiscal year.
It represents the largest deficit to be incurred by any Government in the history of The Bahamas.
Bowe also cautioned that government must demonstrate that the money being spent is meeting its intended objectives.
“I don’t know if it was intended but the impression was given that government is going to be providing for society,” he said.
“When they are speaking on various initiatives whether investments or duty rate reductions they need to indicate what the intended outcome is of that initiative and measure if the spend is worthy. There has to be a return for every dollar spent.”
Bowe again stressed the need for the implementation of a national development plan which he said would have define the country’s identity, what industries and sectors it wants to invest and promote and measure key performance indicators and success factors.
“There are some elements that are not of that nature such as social assistance and we just need to make sure that we are getting sufficient resources to the persons that need it but when we talk about every other type of expenditure we need to be sure that we are seeing objectives being met,” he said.