Tobago – Budgeting Without A Political Authority

By Vanus James

Tobago needs their House of Assembly to be established in order to use its power to formulate and implement policy for the 33 areas of responsibility assigned under the 5th Schedule of the Tobago House of Assembly [THA] Act 40 of 1996. Without an Assembly, there will be many risks for Tobago, with six of them being:

  1. The Chief Secretary will not be able to transmit draft estimates in accordance with the appropriate legal procedure, resulting in the Minister of Finance being required to prepare the estimates in accordance with his discretion.
  2. The people of Tobago will not have adequate representation in the process of planning and budgeting to meet the 5th Schedule responsibilities.
  3. There is a high probability that a Cabinet-dictated Budget will be inadequate.
  4. The Secretary of Finance and the Economy will not be able to implement the provisions of Section 51(a) of the Act – with grievous consequences.
  5. The Secretary will not be forced to answer important questions in relation to the $300 million Bond issue.
  6. The citizens of the country will be without institutional arrangements to scrutinize the use of their monies by the holdover Executive Council.

Under Section 41, the Act requires that in each financial year the Secretary of Finance and the Economy must submit to the Assembly, for their approval, draft estimates of capital and recurrent revenue and expenditure respecting all functions of the Assembly for the next financial year. The Assembly must approve the draft estimates submitted with whatever modifications they think fit. Then the Chief Secretary must transmit the approved estimates to the Cabinet of the Government of Trinidad and Tobago for their consideration and approval. These estimates must be transmitted before the end of the third quarter ofeach financial year, that is, before June 30 since the financial year runs to September 30.

But, as Risk 1 states, inasmuch as there is currently no constituted Assembly, the Chief Secretary cannot transmit draft estimates in accordance with the foregoing procedure. By Section 42(2) of the Act, development of the estimates will be up to the Minister of Finance and, obviously, the Minister is in no position to do so in accordance with the will of the people of Tobago. Which highlights Risk 2, the derailing of democracy in the budgeting exercise.

Risk 3 is that a Cabinet-dictated Budget will be inadequate. There will be no opportunity to weigh Cabinet’s allocations, express dissatisfaction with all or part of them, or trigger the Dispute Resolution Commission pursuant to Section 44 of the Act.

Risk 4 has the grievous consequence of the Secretary being unable to borrow by way of overdraft such short-term sums as the Assembly consider fit for the discharge of their functions. This can lead to the further significant risk of the Assembly running out of cash while awaiting transfers from Trinidad to do recurrent business, as well as of all sorts of delays in payments, or even cuts in expenditure (in addition to what COVID-19 already demands).

Risk 5 is that the Secretary will not be in a position where he is forced to answer important questions on the $300 million of long-term Bond funds. Without an Assembly, there will be no way for the people of Tobago to monitor and evaluate these long-term loans.

Some of these questions are: Will the assets acquired with the Bond funds generate an average growth rate equal to, or higher than, 5.2%, as they should? Will the acquired assets help Tobago’s businesses to innovate and bring to market profitable solutions to significant problems addressed by the local and global markets. Failing that, will they raise the productivity of labour relative to the wage rate in both the government and private sectors in Tobago? Will the assets lead to growth of tourism exports from Tobago at a rate commensurate with the desired rate of growth in excess of 5.2%?

Without a properly constituted Assembly, the Secretary cannot be forced to answer such questions for the people of Tobago or, for that matter, the nation.

Risk 6 is that the citizens of the country will be without institutional arrangements to scrutinize the use of their monies by the holdover Executive Council. Section 45 of the Act provides that by the end of the fourth month of each financial year, the Secretary must submit to the Assembly a statement of accounts showing the monies paid into, and the expenditure met from, the Tobago Fund in respect of the functions of the Assembly during the previous financial year. This means that a statement of accounts for the last financial year is now due. However, there is no Assembly to receive and consider such a statement.

So, Tobagonians will remain in the dark about whether their monies are being properly handled. The substantive warning of the Auditor General’s Report on the 2016 finances, published in 2020, was that the Executive Council cannot be trusted on such a matter. This message is reinforced by the most recent (2020) report of the Auditor General on national expenditures.

Legislative oversight is needed. The Assembly must be constituted urgently. Or, ring the bell – democracy dead in Tobago!

Dr Vanus James is a Tobagonian economist and political scientist. He participates in Tobago CivilNET a nonaligned umbrella group of Non-Government Organisations [NGOs] and citizens seeking to unite the island’s individuals and organisations for positive change.
Please join the conversation on Caribbean Empowerment’s Facebook page at https://www.facebook.com/groups/2583126101949661/ Or, you can comment by emailing us at: caribbeanempowerment@pm.me

 

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s