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Budget balancing and living costs

As could be seen, both bouquets and brickbats have greeted the UNF government's maiden budget proposals which were presented in parliament on Friday by Finance Minister K.N. Choksy in a refreshing simple, down-to-earth style. The people are likely to have welcomed this lucidity and clarity of thinking which, after all, should be the hallmarks of budget speeches.

Admittedly, this is no "sunshine budget". There are no immediate and palpable economic benefits for the ordinary people. Down the decades, it is this aspect which is singled out as differentiating a good budget from a bad one. We are unlikely to see the cost of living, for instance registering a sharp, downward decline in the short-term. Many basic necessities are not going to be available at purse-easy prices immediately.

Considering these factors, opposition political forces seem to be right in claiming that the masses have been down-played in the budget proposals.

However, it should be considered that the Government has not inherited the rosiest of economies. Economic stagnation and negative growth have been our lot over the past two years. In fact some economists assessed our economic performance last year as the worst since the early Seventies.

Clearly, jump-starting the economy would have been the Government's first priority in this sphere which is so close to the people's stomachs. Some of the means of achieving this are the rapid injection of capital to the ailing sectors, such as industries and enterprises, and deregulation and liberalization of the local economy. This accounts for the wide acceptance of the budget proposals among the private sector and the captains of capital.

The Government could not be faulted for this strategy too severely when one considers the economic circumstances we are in.

Ideally, economic empowerment of the poor should be attached top priority in our development strategy. However, whether this could be achieved in the short-term would depend on the availability of financial resources.

Since we do not possess the means to empower the poor in the immediate future, growth strategies should be fashioned to ensure that economic growth does "trickle-down" to the poor in the medium and long-term. If this is not ensured, the charge that we have been foisted with a pro-rich budget could be found to be correct.

We note that a phased reduction in import tariffs is being made to coincide with a degree of protection for locally-produced essential commodities, such as rice, chillies, onions and potatoes, against low priced imports of the same produce. All this is in order but relief measures should cover essentials such as milk food too. There is, after all, a close link between the nutritional status of the people and living costs.

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