Thursday, August 6, 2015

Economist warns govt

Source:The National, Thursday August 6th, 2015
AN economist has warned the Government to exercise wisdom in managing the economy and to avoid burdening the children of tomorrow with “excessive and imprudently accumulated debt”.
Institute of National Affairs executive director Paul Barker told The National yesterday that the Government should have had a supplementary budget as early as last December to make adjustments on allocations in the 2015 national budget.
“There may be recoveries of energy prices and other commodity prices in the next months, but the Government certainly should not bank on it,” he said.
“Now is not the time for brinkmanship, but for wisdom and from learning past lessons.
“And certainly not unduly burdening the future population with excessive and imprudently accumulated debt.”
He was commenting on a report from Treasury on its mid-year economic and fiscal outlook.
He said it was time for the Government to be mindful of the past mistakes and change from it.
“It’s time for focus and stimulating the other sectors, and restraining unsuitable impediments on agriculture and other renewable resources industries, from top heavy and politically controlled new regulatory arrangements,” Barker said.
“As well as ensuring that the investment (including taxation) rules are applied even-handedly to all businesses and investors, not on a selective, or preferential basis, with some exempt.
“A supplementary budget, even if it’s months after it should have occurred, would remain preferable to the administrative cuts occurring now.”
Barker said it would have allowed the process to be undertaken in the open, “with Parliament and the public able to see how allocations are adjusted and for some level of debate into what the priorities should be and how they should be safeguarded”.
“What the Government seems to be doing now has been budget reduction by attrition, instead of using a supplementary, notably by simply failing to release budgeted funds to respective government agencies and provinces, but seemingly deferring payments to contractors.”
He urged the Government to manage funds wisely.

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