Belmopan, 22 March 2016
Mr. Speaker,
Fellow Citizens
It is my honour to address this house and our nation in response to the budget presented by our Prime Minister on behalf of his UDP Administration.
We in the PUP believe that the budget is the most significant part of our legislative agenda and the budget presentation and debate is a very important exercise.
We take it very seriously and participate in this annual exercise in a sprit of patriotism and in fulfillment of our responsibilities as elected members of this Honourable House.
As is our practice, we prepare not only through our work as a Parliamentary Caucus, but also by consulting with our Party Supporters, Private Sector Organizations, the unions, the churches and civil society.
We do this so that our contribution, as best as possible reflects the will and concerns of the people.
And so on behalf of all of us here on this side of the House I thank all those who assisted us and engaged with us during our consultations.
Likewise I wish to thank the fine members of the Public Service who assisted in the preparation of the budget.
All those finance officers, the Financial Secretary and everyone in the Ministry of Finance, we thank you for your hard work.
Perhaps this is a good time for me to lend support to the much needed salary adjustment to Public Officers and teachers, which the Prime Minster mentioned in his presentation.
That is one aspect of the budget we can enthusiastically support.
We believe that at the heart of any budget and by extension this exercise should be the confidence that better days are ahead of us.
We believe that this exercise should inspire in all our people HOPE and from all of us it SHOULD elicit action.
Indeed, we expect the budget to be more than just numbers.
Any responsible government in 2016 should formulate, present and pass a budget that prioritizes its programmes.
This budget must also show the efficiency and effectiveness of the administrations stewardship.
The budget should be the ultimate exercise in the effective allocation of the nation’s resources.
And it seems this year; our nation’s resources are very scarce indeed.
Perhaps this fact has been willfully ignored in these past years, since the Auditor General’s report indicates that this Administration seems indifferent to affordability and efficiency of the spending of the public purse.
Mr. Speaker Belizeans are incredible people; we are a creative, productive, friendly and compassionate people.
For the most part we are optimistic people.
This 2016/2017 budget, I am afraid, does not reflect any of the qualities that we see in our collective Belizean identity.
This is not a budget that is optimistic.
This is not a budget for Belizeans.
It is not creative and it is neither hopeful nor resourceful as we are.
The priorities set out in this budget, if any, are not the priorities of the Belizean people, they are recycled initiatives and programmes put in place by an administration that lacks the competence to find real solutions to the serious problems that face our generation.
This budget will not make us safer; it will not provide those much-needed jobs that will grow our economy; it will not encourage any new growth in the business sector; it will not expand education for our young people, who are out of school and it is not reflecting the fairness we need if we are to lift up all Belizeans.
Indeed after the tax increase on fuel leveled on us just days before the budget speech, Belizeans listened to the Right Honourable Prime Minister’s speech with fear, afraid that with the Petro Caribe money all but gone that this government may be one pay check away from bankruptcy.
Everyone knew that with the elections now behind us, this would be a year filled with pain and sorrow.
Having just won in the General Elections in Orange Walk — and let me take a moment here to record my gratitude to the good people of Orange Walk Central–I wished we could all anticipate a good year.
After all the best, they said, was yet to come. So before the speech I really expected a good budget.
Sadly, this budget is a let down. UDP’s, PUP’s and all of us have been let down by a budget that lacks any meaningful plan for the future, it offers no path to the creation of new jobs or the improvement of productivity.
There is no plan or idea for an improved investment climate and no blueprint for social uplift for those Belizeans who are living below the standard of living.
Will this budget result in any significant reduction in poverty? It will not.
Will this budget instill the confidence needed by the private sector to create jobs?
It will not. Will it grow the Belizean economy at a pace that we can bring some support to our struggling middle class?
NO it will not!
This is a budget that lacks the imagination one would expect from a new administration and it certainly lacks the confidence that will make young Belizeans want to stay in Belize and invest.
There is nothing here that even attempts to encourage any entrepreneurial spirit; nothing that speaks about reigning in government spending; nothing to make our people on the margins hope for a good year.
Budget Consultations
Mr. Speaker during our consultations, many issues were raised; questions were asked and suggestions given, especially on issues dealing with poverty, education, health and safety, jobs and corruption.
I will refer to these issues as we go along, however one point that resonated everywhere we went is that the Belizean People are tired of the way we conduct ourselves in this honourabe chamber.
One woman observed that our behavior was equivalent to a circus;
another inquired whether we behaved with such disrespect even when students attended our sessions.
The point was made that we seem to prefer to conduct the business of the nation like people involved in a street quarrel and hurl insults at each other rather than debate the issues.
Another point that was made involved the responsibilities of the Opposition.
I was asked directly if our only function as the opposition was to object or disagree. I wish to give every assurance that as a responsible opposition we will do more than just oppose.
As the opposition we will continue to carry out our mandate in a responsible way.
Yes, we will provide strong but respectful reactions to those things that negatively affect our national development, but we are also ready to offer remedies.
Overview of the Belizean Economy
Let us now review some of the main points of this budget.
In 2015 our economy grew by a meager 1.2 percent, well below the 2.5 percent that Government projected and well below the average world economic growth of 3.1 percent.
Government overspent by more than 143 million dollars. In a 4 billion dollar economy, Government spending seems out of control. Government is spending 25 cents out of dollar in our economy.
At the end of 2015 we owed 2.35 billion dollars, with a “B” and we are going to borrow another 183 million this year, and according to the Right Hon. Prime Minister we should end up at 2.8 billion by this time next year. I will say more on this later.
The national debt will soon be at 80 percent of GDP
The government spent Petro Caribe money–“bonanza” style– over what he called an “Emergency with a small “e”; and we squandered even more borrowed Petro Caribe money on feel good projects and tacos in an election year. In October alone, Government spent $44,7 million.
According to the Auditor General, we continue to be plagued by a lack of transparency and accountability.
Our agriculture products suffered major hits and we go into this new financial year with no real plan to help the primary sector recover and return to growth.
Capital financial flows have gone down by $100 million.
Big companies like Fruta Bomba in the north is packing up and the Meridian group in the south has already closed down and
The oil is drying up.
Well Mr. Speaker the chickens have come home to roost and in 2016 as the soca song says “the paaty done!”
Just before the budget speech the PM whapped us with that fuel tax to the tune of $50 million and then proclaimed this budget has no new taxes.
The truth is that this 2016 Budget is no celebration of stability, there is no boldness in this budget, the big picture here is that Belizeans wah tek lick in 2016 and when the step up on super bond 2.0 comes next year we will take an even bigger licking.
Let me break down for you and the Belizean people what is really yet to come:
In spite of the $50 million in the new tax on fuel, the deficit is projected to be $62 million.
Of course last year they projected the deficit to be $87 million and it ended up at $180 million, which they said was because they had to pay Mr. Ashcroft.
Well guess what, Mr. Ashcroft is going to collect more –plenty more—when the Arbitration is settled. It is not over yet.
Then there is the 135 million, which he said was recorded as financing.
Call it what you want, the Belizean people still have to pay it back.
Government Spending will once again outweigh revenue, this time by $192 million.
Over 39,000 Belizeans who want to work won’t be able to get a job and thousands more will join the work force this summer.
And for yet another year, Boost and Boots and other so-called uplift programmes will do nothing to lift close to half of our people who are poor out of poverty.
These are the facts.
Now the Right Honourable Prime Minster said in his presentation that this budget is a bold one given the current circumstance.
It doesn’t seem that way to me and here is why:
Of the $126 million we are proposing to spend in health, not a single penny will be spent on addressing the mental health problem, a growing issue in Belize.
Also, there are zero dollars for critical maternal and Neonatal services, which affect our youngest and most vulnerable, our babies.
Close to $1 million was cut from housing and urban development.
In a billion dollar budget, only $1million is budgeted for poverty alleviation; the food pantry will be cut by $100,000 from $2.8 million to 2.7 million
In the ministry of Social Transformation, Constituency assistance program $0,
Back to School assistance programme 0, Mothers Day Appreciation 0.
Sorry folks this is not an election year.
These actions don’t seem bold; they seem irresponsible, for what we see is increased spending and increasing debt.
Yet our poor remain poor and no better off.
What is so bold about that?
The Right Honourable Prime Minster also said that we are entering a period of stability in a time of change.
What he does not say is that we are already in a recession, one with no end in sight and one, which this budget at best fails to address and at worst pretends does not exist.
The Truth of the matter is that for each of the past two consecutive quarters of 2015, the economy shrank.
In the second quarter of 2015, the economy shrank by 1.6 percent. In the third quarter of 2015, the economy shrank by 1 percent and for the fourth quarter, the SIB is yet to announce the figures. But if you go by the Prime Minister’s announcement that overall the economy grew by 1.4 percent in 2015, then there has not been any growth since the first quarter.
Economists define a recession as two consecutive quarters of negative growth.
The Prime Minister knew this situation fully well when he unveiled his election promise of “The Best is yet to Come.” So now the Prime Minster comes up with another slogan, “a period of stability in a time of change.”
The only stability we are going to get Mr. Speaker is continued “haad times” and the only change we will get is change for the worst. Mr. Speaker the last external trade bulletin from the Statistical Institute of Belize spells out the disastrous state of our economy.
Exports for January 2016 are down 29.5%. Drilling down just a little bit deeper, Marine exports shrunk by 79%. Banana exports shrunk by 34%. Sales of orange concentrate shrunk by 30%.
These were only partially offset by some sales in petroleum of $3million and increased sale of volumes of sugar. By any standard, local or international, it is clear that our economy is contracting.
Mr. Speaker, WE ARE IN A RECESSION.
And how is the government planning to get us out of this recession? By spending and by putting a $50 million “wap” on the Belizean people. Do you know how much of that $50 million each of us will have to pay? Every Belizean man, woman and child will have to pay $143 more to Government this year.
This is the true picture, an economy in recession; our national debt reaching 80 percent of GDP and a government clueless about how to fix one of the key pillars of our economic growth, the agro productive sector. Now Mister Speaker recessions come and they go. We survive them best when we ensure that productive Belizeans drive our development. Of course sometimes government has to intervene.
We on this side believe that in times like these we have to work with our partners in the productive sector so that we can put all our collective talents into fixing what is wrong and getting us back on track. I met with people from the agro productive sector and what they are saying is that 2016 is not looking good. Papaya is going out of production in part due to government’s ineptitude. This will cost over 800 jobs and millions of dollars in income.
The people in the productive sector are asking if Government can end the delays in paying back their GST refunds. They are once again asking if Government would once and for all move to charge GST on the back end of production instead of the current practice of charging on the front end. We would support this.
The productive sector would also like to see its Government consult more when it comes to trade negotiations and do its part to get more of our products into markets in the Caribbean.
Petro Caribe Roll It
Mr. Speaker I have no way of proving this, but I want to believe there is no other government in this region where the words Petro Caribe are used more than here in Belize by the UDP.
It would seem like no sitting of this National Assembly can occur without some utterance of Petro Caribe.
It seems to be the linchpin of our Government’s development strategy. Sadly Petro Caribe can no longer roll it, because di bonanza done! In two years, this UDP Administration spent over $325 million of Petro Caribe funds.
One would have hoped that this kind of spending would have served as a catalyst — a driving force — for our development. So let us see if such was the case. Of the 325 million spent from Petro Caribe funds, 35 million was put into the National Bank.
From what the records show, it appears that the National Bank is operating at a loss. In the past two years the National Bank has lost about $2.6 million and the main reason for that loss is because the operating cost seems greater than the income it can earn.
This is not sustainable and we can’t keep putting more and more money into the bank, it must be managed in a sustainable manner.
Let us now look at the infrastructure projects that were done.
I wonder if many of the inferior quality streets and roads that were rehabilitated with Petro Caribe funds were done cost effectively.
We won’t know until we see a report of how much these streets and roads cost and who got those contracts, this may very well be why people keep telling us about a lack of transparency and accountability.
You know Mr. Speaker the Member from Belmopan loves to remind people of the past and about what we supposedly did between 1998 and 2008.
He pretends to forget that it was the PUP who did the Marine Parade reclamation project, we built the Boom/Hattiville road, the Orange Walk by-pass, we did work on the Humming bird Highway and built the Southern Highway.
New communities were built in Fresh Pond, Los Lagos, Mile 8, San Lorenzo Housing Site and Maxboro.
Perhaps the people from the “special vehicle” institution called BIL can provide for us a list of their projects and let us see if those projects impacted Belizeans the way ours did.
Now I was the person who signed the Petro Caribe Agreement some years ago and as I understood it at the time, the role of the fund was mainly to assist in the development of the country. It is clear that some of the $325 million was spent in fulfillment of that objective.
What is also true however is that many millions of these loan funds were spent mainly in public sector spending and frivolous cheer programs instead of investing and strengthening our job creating export-led industries like the papaya, sugar, citrus, banana, shrimp and the very important tourism industry.
Some of the millions spent giving “cheer,” buying flat screen televisions and pibil should have been used to develop and fortify a sustainable economic base.
We did not do this. Petro Caribe monies should have also been invested in creating a formidable trade infrastructure to support our industries, enabling them to compete not only in regional but international markets.
As we see it, the most important economic challenge facing Belize today is how to create an environment that will allow our private sector to flourish and grow in these days of dynamic change.
We should have used some of that $325 million to help the productive sector brace for what was coming.
Many of the industry stakeholders already have good ideas and answers to some of these problems, but lack the resources to fix them.
Those Petro Caribe Funds would have gone a lot further in helping Belizeans than flat screens, road trips and party bags.
Job Creation and Wages
Development will come if we invest in our human capacity, it will come if we spend money on efficiency; if we focus on those sectors and commodities where we have a competitive advantage.
If we can increase the yield and productivity of our production, manufacturing and service enterprises. Did any of the $325 million in Petro Caribe funding get spent on initiatives that would impact on this either directly or indirectly? Those we spoke to in the agro productive sector and the Chamber do not feel it did.
If we are to invest in our people then we need to make sure that wages are fair and that what we earn is enough. Today 90 cents out of every dollar the average Belizean earns is going in just meeting the necessities of life.
That leaves only 10 cents is left for savings, or investing or for taking a little vacation.
Earlier I mentioned that we on this side support the salary adjustments for the teachers and public officers, and we do, but where wages are concerned it ends there.
The Rt. Honourable Prime Minister took pride in declaring that his Government advanced the wellbeing of the working class by touting the lowest unemployment in a decade and a surge in wages.
Let’s take a closer look at the facts. Since 2008, more than 1500 jobs have been lost in the Corozal Free Zone alone. When we left office in 2008 over 3000 employees worked in the Corozal Free Zone, today that number stands at 1,521.
In papaya, over 260 jobs have been lost. At its peak, papaya employed over 700 people, so really the job loss in papaya has been even more devastating when looking beyond just this past year. In banana, over 400 jobs have been lost over the past six months. All together, over 3,300 jobs have been lost in key industries alone.
So to say that the unemployment rate has gone down is at least a fiction if not a fraud on the people. With respect to real income, today’s working man or woman who earns above the threshold of $26,000.00 annually or $500 per week and expected relief from this UDP Government is now paying more taxes than before.
What they got instead of relief was the tax “wap” on fuel, further eroding their income. Today a working class Belizean earning $26,000 pays more than 40 cents of every dollar earned to the government.
For every dollar earned, Income tax goes with 25 cents, plus twelve and a half cents on GST, which equals thirty-seven and a half cents of direct taxes. Add social security, fuel tax, and property tax and you see how we get to forty cents.
As for the purported surge in salaries for public officers, let us look at the whole story on wages. No less than the statistics produced by the IMF show that over the eight years of the UDP, the average income per person in real terms after accounting for inflation has increased from $7,318 to $7,663 an increase of only $43 per year or 0.6 percent per annum.
That is an increase of less than $1.00 per week. In other words, with the UDP you can’t even afford to buy an extra pound of beans.
This is in stark contrast to the nine years under the PUP during which the average income per person grew more than five times faster than under the UDP increasing from $5,675 to $7,318 or by over $182 per year per person.
So for all the hundreds of millions of Petro Caribe monies, the millions more in borrowing and spending by this UDP government, the people have gained nothing, not so much as an extra pound of beans.
Education in the 21st century
Mr. Speaker our economy will grow and sometimes, like now, that growth is not going to be enough to lift people up.
Still we have to find ways to sacrifice today so we can do right by our children to ensure they inherit a better Belize then the one we inherited.
Our future then, depends on investing in our best resource: the creativity and skills of Belizeans. Education for tomorrow Mr. Speaker means that today we must provide relevant education. Our students must learn using digital technologies and they must learn computer science as well as reading, writing and arithmetic.
All these subjects should be taught in every primary and every secondary school in Belize. We must commit to this if we are to allow our young people a chance and a future PUP Government will ensure that we get computers and computer science in all our primary and secondary schools.
This should work hand in hand with those critical thinking skills, life skills, the natural sciences, physical education and Belizean History, which should include African and Mayan History.
Education is about the formation of the whole person, body, mind and spirit.
So we agree with the Right Honourable Prime Minister when he says that as much as Government is spending on education, it is not going far enough. Education is not only the key to social transformation but also the key to economic uplift and prosperity.
This is why when it comes to investing in education it must be meaningful and it must be sustainable. If we are to properly educate Belizeans for the 21st Century we can no longer grow in small increments, we have to leap forward. To be honest, I am disappointed every time I think about all that was done with the $325 million in Petro Caribe funds. I wish more had been invested in education.
In spite of its entire purported obsession with education, of the 325 million Petro Caribe dollars, a mere pittance was invested in education. Yet the next generation will have to be paying back this money. I believe that like the Prime Minster the Minister of Education care deeply about the future of this nation and about our children and young people.
I hope, that like we do, the UDP believe wholeheartedly that we cannot build this country if we do not have a plan for education that envisions the direction and path we want our country to embark on. Where will our nation be in 2050? Upon what priorities will we build our development?
Once we have decided upon that path then we can develop our plan for education. So I ask, what is this plan? What are the industries of the future that we want our country to be participating in?
Please don’t tell us they are the same industries we are already in, as BELTRAIDE year in, year out, focuses on, that is to say agriculture and tourism. For if this is the case, all it shows is that there is no thought, no vision for our future. I suggest we work with the churches and other education providers, with industry stakeholders and with other partners to devise a plan that will result in relevant education.
A plan that will provide a relevant and holistic education that equips our young people for tomorrow’s careers. A plan that will allow students to create jobs for themselves and other Belizeans.
Mr. Speaker I want to remind all of us what Alec Ross the author of “Industries of the Future” wrote:
“There is great shame in our leaders when a life is made less than what it could be because of a lack of opportunity.”
Future Challenges and Priorities
Mr. Speaker eight billion dollars in eight years, that is more or less what this Government has spent since coming to office in 2008. This is how much they have asked of the Belizean people.
By any measure this is a grandiose amount of money. Of course the Government will be the first to tell us that their performance over these eight years has brought about prosperity.
And yet after eight years and eight billion dollars, 175,000 Belizeans live on less then $10 a day. The minimum wage is still at three dollars and twenty-five cents, the exact same place we left it in 2008.
Crime is completely out of control and our economy can’t even grow enough to keep up with the growth of our population. The Right Honourable Prime Minister says that the forecast for the state of the public finances of Belize are sturdy and stable.
Is it sturdy enough to withstand another year of anemic economic growth? I fail to see how this will happen, when by his very admission the production from virtually all export commodities is expected to contract.
Add to this is the mother of all problems, the rising national debt. I do not believe that we can achieve financial sustainability if government is constantly borrowing to pay its light bill, its water bill, and its rent.
This is very much like using your credit card to pay your bills because your expenses are higher than your earnings. The economists tell us that we should do all possible to make sure that the ratio of our national debt to GDP does not pass 60 percent; ours will soon exceed 80 percent.
As I said, the Right Honourable Prime Minister projected GDP growth this year of between 1.5 and 2 percent, however in a recent statement put out by the IDB, countries in our region are expected to grow at a rate of 4.5 percent thanks to the significant drop in oil prices.
This drop in oil prices is creating a favourable climate to implement reforms, to increase productivity and international competitiveness. If what the IDB is saying is true, why is the PM projecting our rate so low, or better yet, what must we do to reach that 4.5 percent?
We share the opinion of those we consulted in the private sector who told us they believe we can do better than 4.5 percent, but we have to be focused.
In so doing we are prepared to work with the government on the following:
We will help on initiatives that bring meaningful relief to the poor.
While we are at it, why not give a large portion $5 million that is budgeted for Belizeans with disabilities to the churches? They already have the mechanisms in place to effectively manage these kinds of funds and I am sure they will be very open and transparent in doing so.
We will work with the Government if they want to find the money to roll out NHI for every Belizean man, woman and child.
We are prepared to take to the streets if this government will work with us to develop a plan to stop the killings.
Mr. Speaker I beg the Minister of National Security to give us a plan that will bring the killings to under 100 murders per year and end the urban civil war that has over taken some of our best communities in our cities and towns.
Let us come up with a plan to develop our human capacity so Belizeans can be more relevant, efficient and productive both in the public and private sector
We are ready to cooperate on initiatives that will help our struggling agro productive sector.
We will work across the isle with you on initiatives that will help create more small businesses in Belize.
We will cooperate on initiatives that will help to strengthen transparency and accountability. Prime Minister let us together sign the UN Convention against Corruption (UNCAC).
We will work with you to fulfill our commitments under the Sustainable Development Goals.
And make no mistake about it Mr. Speaker, we will work with the Government on finding a peaceful and lasting solution to Guatemala’s unfounded claim to Belizean territory; clear in the understanding that we will never surrender one square centimeter of what we know is rightfully Belizean territory be it land, sea or RIVER!
To show our serious commitment to this let me say now that we say YES to the following measures in this Budget.
Yes we support the salary increase for teachers and Public Officers
Yes we support the provision that will provide for more officers in the police and coast guard.
Yes we support those initiatives that will allow for more money to be spent in education that will directly benefit students as opposed to administrative costs.
Yes we support those pro poor initiatives provided they are being properly managed.
A Belize That Works for Everyone
We say all these things Mr. Speaker because our sole purpose as PUP’s and as Belizeans is to promote and support a development vision that can succeed in delivering the best quality of life for all Belizeans.
Yet, I fear that there are dark clouds looming overhead.
The numbers tell us that last year’s budget was just a bunch of figures for the Government. After all, they outspent what they had forecasted by 142.8 million dollars.
Last year’s budget was yet another exercise in incompetence; it was a fairytale without a happy ending.
That is proof enough that this is an irresponsible budget. The projections for this year offer no more than a promise of stability; inadequate economic growth, insufficient funding for investment for our young people at risk.
No initiative that will improve the investment climate thereby bringing about new job creation and it will not seriously address poverty and uplift those on the margins.
What it will succeed at doing is continue to waste and spend much more than we can afford to spend. Because we believe this budget fails the Belizean people, we vote NO to the excessive spending.
Mr. Speaker during last week’s consultation a gentleman got up and spoke of the living conditions of a Belizean family he visited. He spoke of visiting a home in the Toledo district where the only possession that family had was one small table and a fire hearth.
The children, he said, went to bed every night on the damp floor. This is the sad reality for too many of our people and this should tear at our conscience. NO Belizean should have to live like this in 2016.NO Belizean should have to survive like this in our four billion-dollar economy. Every Belizean child who will go to sleep on a cold floor tonight is proof of our failure to lead this nation to prosperity.
Our vision, the PUP vision, is for a fair and thriving Belize with an economy that is growing on pace with our population growth, where our children can go to sleep on a bed; where young people can get a relevant education and then find good jobs that they can turn into careers; where our elder citizens can retire with dignity, where parents can send their children to school and families can thrive in safe neighbourhoods.
We in the PUP believe that just as responsibility is shared, so too must opportunity.
This is what we mean by the promise of prosperity.
The PUP is ready to work with anyone who shares this vision.
To our supporters we say it is time once again to come home.
To everyone else we say Believe Again!
We promise you that together we can build a Belize that works for everyone.
Mr. Speaker I still believe in Belize.
Thank you.