Sun | Dec 4, 2016

Failing the people's test

Published:Friday | October 3, 2014 | 12:00 AM

Finance Minister Dr Peter Phillips has one of the hardest jobs in the Cabinet.

Depending on the day and crime issue, Peter Bunting overtakes him, but recently, Dr Fenton Ferguson seems to have been jealous of the public punishment the two Peters have had to face from time to time.

Ferguson used his inaction and denial of the chikungunya virus rampage in Jamaica to hog the whole public punishment trough for himself for the past couple of weeks.

Minister Ferguson's self-inflicted wounds aside, Peter Phillips often finds himself between a rock and a hard place. The agreed requirements of the IMF and the very acute needs of the vast majority of Jamaicans - the poor and those getting poorer everyday - are the rock and the hard place. Sometimes they change positions.

The recent discussion and cry that the finance minister, prime minister and their Government can pass the IMF tests but are failing the people's test, has fallen on fertile ground.

The ground is fertile and receptive due to the pervasive and severe hardships that many ordinary Jamaicans are facing at the apparent hands of the Simpson Miller administration, a government that voters gave an overwhelming majority in exchange for a slew of promises to better their lot in life.

Dr Phillips' and the Government's difficulties in dealing with 'the Rock' (Jamaica) and the hard place (the IMF in this instance) are multifaceted.

The IMF's requirements are largely quantitative and based on hard data. The tests of the Jamaican people, on the other hand, are an admixture of data - largely macroeconomic figures which are not felt in wallets and pocketbooks - emotions and feelings spiced up by interpretations which are regularly closer to the reality facing Jamaicans at this time.

IMF TEST RESULTS INEDIBLE

For the Jamaicans who find it hard to pay their rent or mortgage on time while paying utility bills to JPS and NWC and a plethora of taxes, who cannot find the money to buy medicine and sometimes food, too, and are forced to wait almost 24 hours for a doctor at the Bustamante Hospital or similar health facility even to look at their sick children with chik-V symptoms, the passing of IMF tests are either irrelevant, at best, or downright oppressive, at worst.

To these suffering Jamaicans, taking money out of the economy to meet an unusually high 'primary surplus' - a term many of them may not even understand - in order to satisfy the IMF agreement, the IMF to them is an oppressor and the Government and its point-person or persons, agents of the oppressor.

Many of us know we had no alternative but to seek an agreement with the IMF. Some may argue that the terms are too harsh, others will say the IMF gave the People's National Party administration a 'bly' on some of the tougher issues like restructuring the inefficient government bureaucracy.

Still, passing five of the 15 or so IMF tests is good in a macro sense, and the finance minister, if not all in the Government, will count the holding to that 7.5 per cent primary surplus target as an important factor in the overall fiscal consolidation programme.

Regrettably, meeting those targets do not translate into money in people's largely empty wallets. The opposite is the case. In fact, the continual meeting of those targets means that Dr Phillips is constantly in those near-empty wallets of most Jamaicans seeking to extract more and more cash in the form of taxes.

In a real sense, people cannot eat those IMF test results and targets.

HIGH FAILURE RATE

The people's tests revolve around some version of 'Do I have more money to meet my basic needs' or 'Am I better off today since the current Government took the reins of power in December 2011?'.

Taking money from the NHT to meet IMF demands and so reduce new housing starts by about 11,000, and cutting many construction jobs in the process, is to fail one of those tests.

Other failures include increased bus fares, and the imported items we must buy are more expensive.

The value of the Jamaican dollar has fallen badly in the almost three years since the Government took power - and noticeably since we signed the IMF agreement. We have not been told the truth about the seriousness and range of the chik-V problem, nor about the right number of quarters of growth immediately before Prime Minister Simpson Miller took office in December 2011.

Roads have become worse in many places and so the cost of vehicle repairs has increased.

In December 2013, Minister Paulwell gave a timeline of January 2014 to start construction of his parachuted-in EWI liquid natural gas power plant, and completion was to be by January 2016. We now hear from the Energy Sector Enterprise Team of a 2017 completion date.

This is failing the people's test for cheaper energy.

Probably the worst failure of the Government is not to have targeted economic growth on its arrival to power. Economic growth is off their radar. The focus was on the IMF, and growth, if ever considered, was treated as mutually exclusive to the IMF deal.

They refused, for far too long, advice to put economic growth in their management cross hairs.

Aubyn Hill is CEO of Corporate Strategies Ltd and chair of the Opposition Leader's Economic Advisory Council.Email: writerhill@gmail.comTwitter: @HillaubynFacebook: facebook.com/Corporate.Strategies