Former Prime Minister Bruce Golding was the official Guest Speaker at the packed Jamaica Chamber of Commerce 31st annual awards dinner at the Jamaica Pegasus Hotel in Kingston, Jamaica last Thursday night. Mr. Golding clinically assessed the matters related to the IMF and Jamaica’s economy, while offering advice to Prime Minister Simpson-Miller. This is Mr. Golding’s first public speech in over a year. His words were wise, sobering and very well-received.
Here are most of his key statements:
The suspense and the agonizing that have attended these negotiations bring with them a tactical hazard, that we may be inclined to comfort ourselves that concluding a new IMF agreement is the ultimate goal, the end of a long an difficult struggle. We would do well to recall the words of Winston Churchill in 1942 when Britain’s fortunes in World War 2 began to change, and he said that, This is not the end, it is not even the beginning of the end, it is perhaps the end of the beginning
The choices that are open to us are so stark and so few that we cannot afford not to get it right this time, we must do what is needed to get us back on our feet or we must be prepared to remain bedridden.
We have been around this mulberry bush for so long that it is not hard to understand why the Jamaican people are so skeptical of any new adjustment program because they fear that it is going to be only a matter of time before we stumble upon another crunch time. It is this diminishing credibility of successive adjustments that make it important for us to get it right once and for all. Both historical and contemporary experience show us, that timidity, half measures not only do not fix the problem but make that fix even more painful in the future…
THE WAY FORWARD
I am not in a position to prescribe the precise mix of policies and actions that government needs to take; I have been away from the numbers and the modeling of alternative strategies for almost 18 months, what I am absolutely clear about, is that the actions enunciated so far will not put us on a path to economic growth, they may meet the conditions embodied in the IMF agreement, but even if it won’t be business as usual, it will be merely be business as it use to be before we got to the edge of the cliff, not business as it needs to be to sustain hope, stimulate investments, create jobs and promote growth.
The Measures that need to be taken must go beyond those that the IMF requires in order to create space for pro-growth initiatives. In other words we need to be IMF plus if we are to stand a chance of not just passing IMF tests but getting to the stage where we can stand on our own feet once again.
THE PUBLIC SECTOR
It is an illusion of compassion, an illusion of compassion for us to maintain hundreds of government departments and agencies when there is no money to fund the work that those agencies and departments are to do. So for no fault of their own they are sitting down basically idle, because all we can pay are the salaries and the utilities and we are not able to fund the programmes, the work that they are supposed to do. In the process we simply put the future of the entire country in peril.
The comprehensive tax reforms proposals that were taken to Parliament in 2011 have been so adulterated, these were proposals designed broadly speaking to broaden the tax net and reduce the tax rates, they have been so adulterated that what is being implemented now is a mere shadow of what was originally conceived.
The Pension reform proposals which were also taken into Parliament in 2011, I have just been told have been put off for another 3 years. The cost of government pension doubled in the last 5 years and are likely to double again in the next 3 years.
PUBLIC SECTOR RATIONALISATION
The Public Sector Rationalisation Program, again presented to Parliament in May of 2011, designed to merge the functions of several government agencies and to reduce the size of the Public Sector by over 10,000 over the next 5 years are over a five year period have been dealt a severe blow by the government’s undertaking that there will be no lay offs.
CIVIL SOCIETY AND DECISION MAKING
As our democracy has matured and as civil society have become more engaged and more organized there is this increasing demand for consultation, that is healthy and it can be beneficial to government in securing greater understanding creating confidence, building partnerships. And in those consultations the government must be disposed to listen to contrary views and to adopt suggestions that can improve the effectiveness of government policy. But we must never lose sight of the fact that it is the government, not civil society groups that was elected to formulate and implement the policies that IT, the government, considers appropriate and necessary for the good management of the public affairs of Jamaica as the oath of office prescribes. Too often the demand for consultations leads to the insistence on consensus; consensus invariably requires compromise, that often so disembowels the original policy proposal that the objective is lost. Many of the issues that must be dealt with are so contentious that consensus is just not possible given the competing and indeed conflicting interests of the various groups in the society. After the consultations have been held the government must be bold enough to take the tough decisions that it considers necessary and it must get on with it, and claim the credit for their success or be prepared to accept the blame for their failure.
PARADIGM SHIFT NEEDED
Of course it is easy for me to say these things now because I am no longer in office. I am no longer buffeted by the political and other constraints of that office. I am not seeking office either and so I don’t I am not hostage to the need to say popular things. But my 4 years in office and the severity of the financial crisis that exposed our nakedness convinced me that a paradigm shift is needed. It is by no means an easy path, it will involve serious political risk it requires not only strong political leadership, but a strong political mandate unencumbered by the size of its Parliamentary majority, unencumbered by the imminence of the next election and unencumbered by questions of credibility, as I encountered because of that extradition matter.
The government wasted in my view its best opportunity right after the last election which it won with a 2 to 1 majority, its mandate was fresh, it’s mandate was strong. What has to be contemplated now is what should have been implemented a year ago, but it’s not too late.
ADVICE FOR PRIME MINISTER SIMPSON-MILLER
Prime Minister Simpson-Miller still has an opportunity of being a Prime Minister that changed the fortunes of this country or one who simply let it slide. The risks are enormous but the possibilities are real and the alternatives are bizarre. If Uganda, Ethiopia just to name 2 countries can recover from their wars and famine; If Guyana once the rump of the English Speaking Caribbean can become the fastest growing economy in CARICOM, the fastest growing economy in CARICOM, Jamaica can make it if we try, if we do what needs to be done.
I am empathise with the government, I have been there, I know the hard choices that confront it. I empathise with the Prime Minister in particular because after all the papers have been read, after the meetings are over, after the numbers crunchers have turned in their numbers, after the Advisors have tendered their advice, which are, which is sometimes confusing and conflicting. After all of that, she has the lonely job of providing the leadership and direction to navigate our way through these turbulent waters. It is with her that the buck stops. She has to hold the hand of the Finance Minister who has stewardship of the economic program, she has to shield him from the naysayers and the faint hearted even within her Cabinet and even within her Party, because no Finance Minister especially in these tough times, no Finance Minister can succeed without the unqualified support and confidence of the Prime Minister.
The Opposition will be breathing down her neck that’s what Oppositions are for. She breathed down my neck.
Some of her own will say to her, we are damned if we do and damned if we don’t, is better we don’t; I say to her don’t listen to them. Her adoring supporters will say, but you say you love the poor, I say to her turn on your charm nobody does it better than you. Because if we don’t get it right, they themselves will become only poorer. It is indeed crunch time and I suggest that there is a compelling need for us to crunch the time and crunch whatever else needs to be crunched to give ourselves perhaps, the last chance. God Bless you.