The Free National Movement (FNM) says Standard and Poor’s’ (S&P) decision to downgrade The Bahamas’ economic outlook from stable to negative is a direct indictment on the Progressive Liberal Party’s (PLP) handling of the nation’s fiscal affairs since coming to office.
The Opposition said the downgrade is a clear indication that S&P sees no evidence that the Christie administration is seeking to change the direction in which the government’s financial situation is going.
The minority party said prior to the last election, the PLP – while in Opposition – was “vociferous” about the level of the country’s deficit and growing indebtedness, ignoring at every turn the serious impact that the worse global economic and financial crisis since The Great Depression was having on the country.
“This notwithstanding, the PLP came to office and produced a planned deficit of $550 million after complaining that the FNM had left an extraordinary deficit of $504 million. It came to office and appointed the largest cabinet in the history of the country. It came to office and appointed scores of highly paid consultants and committee chairpersons,” the party said.
“It has spent millions of dollars pushing down bushes and trees that are likely to grow back from a lack of development on those properties. It has stashed away $15 million in the prime minister’s budget for some nebulous implementation of their [Charter] for Governance. The level of waste and spending taking place is phenomenal and the comfort that the Christie administration wants the people of The Bahamas to take is that it is the FNM’s fault.”
The party continued, “They want the Bahamian public to believe that they are powerless to control spending, notwithstanding that they have cancelled scores of contracts of persons they believed to be FNM contractors; they have terminated or not continued the contracts of scores of government employees believed to be FNMs; and they have put on hold a number of programmes put in place by the FNM, such as Jump Start and Fresh Start. If they have the power to do these and hand out millions upon millions of dollars in contracts to their political cronies, then how is it that they cannot take steps to reduce the government’s deficit?”
The FNM said the PLP has made no effort to curb spending and has no plans of its own to enhance revenue.
“It shows no courage to make the hard decisions necessary to reverse the country’s fiscal direction. It is hoping that the US economy improves and some foreign investors will come produce growth for this economy. It is hoping that Bahamians will continue to buy their lame excuse that it is the FNM’s fault and that if it had enough time since election to produce a budget of its own, then things would have been different,” the party said.
“This is the same old indecisive, lazy and confused governance that they practiced before.”
The FNM said S&P has given the PLP administration a warning shot.
“The FNM urges the PLP to heed the warning. The FNM urges the PLP do quit with the blame-game and take real steps toward fiscal reform. Most immediately, the PLP must curtail the erratic spending that it is doing in order to both ease the serious cash crisis it is developing and to begin to reduce the planned deficit that it has,” the party said.
“The government had better wake up; for the world is not naïve; Standard and Poor’s; and the other international rating agencies are not naïve. They are looking for evidence of change in fiscal behaviour, not rhetoric. The government must be upfront with the Bahamian people and let them know that tough decisions must be made. They must confess that lavish promises simply cannot be kept. They must let them know that it is time for steps to be taken to rein in the deficit and change the trajectory of our fiscal path.”
