NASSAU, BAHAMAS — The Opposition is expressing alarm over the government’s reported $58 million first-quarter budget deficit, warning that the government’s fiscal plans are in serious jeopardy.
Opposition Shadow Finance Minister Kwasi Thompson, in a statement, pointed to the fact that the reported deficit is almost 300 percent higher than the $20 million deficit for the corresponding period in the last fiscal year.
“Instead of seeing a rapidly shrinking deficit in line with the government’s broader fiscal plan, we see a deficit for the first quarter that has exploded year-on-year. The deficit seems to be well in excess of what should have been the target for the first quarter of the year,” Thompson stated.
“This is no doubt why both the credit rating agency, Standard & Poors, and the IMF are projecting that this Davis administration will bust its budget deficit targets by a huge margin.
“It also explains why in our view, the government has deliberately held back the publication of these reports for months and months and tried to slide them out on a Friday evening before an extended Christmas holiday break. They were hoping no doubt that the Bahamian people would be distracted by the holiday festivities and would miss this bit of troubling fiscal news that does not fit into the narratives being generated by the PLP spin factory.”
According to Thompson, based on the September 2023 report by the Ministry of Finance, this year-on-year spike in the quarterly deficit was fueled by a $47 million jump (7 percent) in spending that compared to a modest $9 million increase (1.5 percent) in revenue.
“This is taking place in a budget where overall, the government is projecting that revenue is to increase by 16 percent and spending only by a half percent. But with the extravagant and unnecessary spending by this reckless PLP government, spending is increasing significantly while revenue is staying flat. What is also troubling about the September report in particular, is the decrease in total revenue, particularly VAT for the month when compared to last year’s September. Also for September, we saw a tremendous increase in spending this year compared to last year September. This trend cannot continue,” Thompson remarked.
The Opposition’s finance spokesman said that the Opposition is again admonishing the Davis administration to face the now-increasing prospect that it will have to adjust its budget plans and reprioritize its spending given that is becoming more and more clear that its fiscal plan is in serious jeopardy.
“We do not want to have to wait until the mid-term budget statement or the annual budget for them to admit that they will have to make adjustments. This administration has known for months now that the budget has been underperforming and that cash was tight and that vendors were not being paid in time.
“Instead of coming clean to the Bahamian people, they instead chose to engage in political spin and to discredit both local and international commentators who were pointing out the obvious: That the government has to cut down on the wasteful spending and come to Bahamians with a serious and achievable plan that prioritizes the welfare of struggling Bahamian families over the narrow partisan interests of PLP cronies and hangers-on,” said Thompson.
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