The Tribune

By KHRISNA RUSSELL

Tribune Chief Reporter

krussell@tribunemedia.net

THE government has given guidelines to ministries and agencies on budget reductions it hopes to see while mulling over its strategy to navigate through economic hardship over the next several months, FInance Minister Peter Turnquest said yesterday.

While he would not say how severe the budget cuts might be, the deputy prime minister said there had been no "formal discussion" to cut civil servant salaries nor shrink the financial capabilities of safety net mechanisms like the National Insurance Board and Department of Social Services.

However, what he said was certain is the government will ramp up its spending, particularly on infrastructure, as it seeks to grow the local economy.

In an interview with The Tribune yesterday, Mr Turnquest also castigated the Progressive Liberal Party, saying at a time like this its pronouncements had only created panic and anxiety. He was speaking specifically to PLP leader Philip "Brave" Davis' assertion that the government needed to increase domestic spending so the country does not slip into a depression and deputy leader Chester Cooper's suggestion that funding between $1bn and $2bn would be needed to keep the economy afloat.

In a statement released yesterday, Mr Davis claimed: "I have learned today that the government is proposing matters which in fact might severely reduce domestic spending and demand. There is a proposal to force cuts in all ministries including possibly the salaries of public servants."

When contacted for comment, Mr Turnquest said: "We are currently in budget hearings now where every ministry goes through their budget line by line and provides justifications for the allocations that they are requesting.

"We have given general guidelines that we would like to see some reductions in the overall budget giving consideration to the economic reality based on what we are faced with (and) what are likely to be faced with over the next 12 to 18 months and so that is the context which we work and I suspect people are trying to cause political mischief."

Asked to reveal the extent of the proposed cuts, he said: "I don't know that that is a public issue at this point until such time as the ministry sets its budget and we advise the public.

"Obviously we appreciate that we care about defending people so obviously we appreciate that this economic downturn is going to have social implications. But one doesn't have to be a rocket scientist to figure out that of all the thousands that have lost their jobs that there are going to be some challenges. So how does it make sense that we would cut social assistance programmes to those people who are going to be vulnerable?"

Asked if civil servant salaries will be affected, Mr Turnquest said: "Government has not made any decision with respect to cutting any civil service salaries.

"We have had no formal discussions on cutting anybody's salaries and no proposal has been made to the public in that regard."

Responding to the official opposition's criticisms and predictions, Mr Turnquest said "mouth can say anything".

"The reality is that we are going to be operating in very constrained circumstances and again it doesn't take rocket science to figure that out. The major drivers of our economy are shut down, not reduced, shut down. That has significant implications well into the future as does the curfew and the lock down have immediate consequences to the domestic economy.

"That said there are obviously going to be adjustments that are necessary in the government even the ability of the government to do some of the things that it would like to do without requiring significant borrowing and that raises a whole other set of discussions when you start talking about borrowing particularly to the level that has been suggested.

"People have suggested that the government put money in the hands of people so they can go out and spend it, but again this is predicated on if there is money to do it. This is an unprecedented time in history for most of us indeed since the Great Depression and so the global community is trying to figure this out.

"There is going to be no doubt a ramp up in government spending in respect to infrastructure in particular, but we are going to use as much analysis and feedback and consultation with the general public to develop our programmes when the time is right to ensure that we give ourselves the best opportunity to grow ourselves out of the problem."

He continued: "This is not simple. This is not something that you can just put some words on a piece of paper and think that is going to work. We want to make sure that the funding that we have to go out to the market to borrow, that it will result in tangible results in terms of activity and helping those who are most vulnerable and we will do our best to ensure that the public is consulted and brought along in that regard including the opposition.

"There is no need for the kind of speculation from the leader of the opposition in particular. It is unfortunate that he would seek to create panic and to create fear and anxiety in the country given the circumstances that we face with respect to this pandemic where people are already afraid and on edge as to what the future holds.

"I just can't imagine any circumstance where a responsible leader would do something like that."