Shadow Minister of Finance Chester Cooper has called on Deputy Prime Minister Peter Turnquest and the Free National Movement administration to clear up “misleading” information presented in the 2017/2018 Budget Communication.
In a statement yesterday, the Exuma and Ragged Island MP made a charge, in light of the latest data coming from the Central Bank of the Bahamas regarding the government’s deficit up to the end of April 2017 that he said raises some very serious questions for the minister of finance and the Minnis administration.
“With great fanfare, the current administration leveled a half-billion-dollar deficit at the feet of the Christie administration during its recent budget exercise, sending shockwaves throughout The Bahamas and the international investment and rating communities,” Mr. Cooper said.
“In its latest report, the Central Bank shows that the fiscal deficit at the end of April stood at $284.7 million. However, when Minister of Finance Peter Turnquest gave his budget communication on May 31, the government put forward resolutions to borrow $722 million to cover what it recorded as a $500 million deficit and bills left behind by the Christie administration.
“On the face of it, the budget disclosures by the Minnis administration seem misleading. We call on the honorable minister to clarify.
“As the Christie administration was voted out of office on May 10, one wonders how in even the most extreme circumstances, an administration could run up an additional $215 million in deficit spending in just 10 days, if, as the Free National Movement contends, it met ‘the cupboards bare.’
“As the deficit is based on actual disbursements, Mr. Turnquest needs to fully explain what the extra $215 million was used to pay that does not seem to have been run up by the PLP. What bills were encountered by the Minnis administration after the election, when the FNM was supposedly tightly monitoring fiscal controls? Or was the estimated $500 million an exaggeration.”
He further stated that as Mr. Turnquest should know, government accounting is done on a cash basis, so backlogged bills that had yet to be paid should not have been factored in to the deficit.
“The deficit represents actual spending and not what bills were left due or that the government wished to pay, as this is a natural consequence of all governments when control changes hands – to meet some bills unpaid – as was the case when the PLP took over from the Ingraham administration in 2012,” Mr. Cooper said.
“After the show that was gleefully participated in by so many ministers of the Minnis administration as the PLP was castigated on the notion of unsustainable deficit spending, it is incumbent on the minister of finance to explain what it spent the extra $215 million on and why; or provide appropriate reconciliation of its numbers versus that of the Central Bank of the Bahamas.”
In June, the Minnis administration projected it would need to borrow more than $722 million to cover inherited outstanding bills along with the costs associated with running the country moving forward, after discovering the current fiscal year is “far bleaker” than anyone could have imagined as the Christie administration left “the cupboard bare.”
The deputy prime minister explained that $400 million is needed to satisfy expenditure for the past year, while $322,462,707 million will be borrowed for the 2017-2018 budget, amounting to a whopping $722,462,707 million.
