For Your Information

Here are some handy facts about the UDP National Budget tabled today in the House of Representatives:

The current year’s overall deficit, 2009/10, will actually be 60% higher than originally approved: the dollar shortfall will be $81.6m versus a budget of $52.3m.

The economy shrunk by .8% in 2009; almost every major sector contracted and exports fell by a fifth of the previous year’s level. Prices for food and beverages continue to rise in 2009, on top of the 13% increase in 2008. Foreign direct investment fell by 50%. GOB revenues fell on average by 10% compared to budgeted levels while expenditures were trimmed by only 2%. $45m in capital investments programmed by the UDP did not materialize. The nation’s debt grew by a net $41m. National unemployment stands at a multi-year high of 13.1%, while for women and youth, the figure is more than 25%.

The new budget, 2010/11, forecasts an overall deficit of $64.7m. The UDP Government plans to collect $110m more in tax revenue this year, of which $61.5m will come from new tax measures. A 2.5 percentage point GST increase will rake in $42m alone. BEL will be slapped with a $10m increase in business tax, EPZs will pay $3.5m in a social fee, GOB will collect $4.2m in tax arrears and the cost of locally produced crude oil will go up by $1 per barrel. GDP will grow by a meagre 1.5%. All of the tax “relief” initiatives proposed by the GOB will give back only $10.5m to the minority who will benefit from them. $127m in financing will be required for the budget which will come from loans from the IDB, CABEI, OFID, the World Bank, the CDB and the EU.

All the tax increases have been proposed without any prior consultation.

This is the UDP’s third budget and its most nefarious. Poor Belizeans will be plunged deeper into poverty. Middle class Belizeans, already in a state of siege, will have their pockets picked, this time by their government.

Ominously for pensioners, Mr. Barrow has also raised the prospect of “reforming” the public sector pension program, which can only be double-speak for cutting payments.

Finally, it is timely to remind ourselves of the contract upon which this administration came to office: 6% annual GDP growth, lower GST, reduced telephone and electricy rates, 5000 new jobs, 1000 new houses, shares for the public in a national oil company, lower mortgage rates and a DNA testing facility to fight criminals, among others. This budget defies all these promises.

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