Monthly Archives: April 2013

SHAW ON STATE OF THE NATION

Audley-Shaw

Section of Mr. Shaw Budget Presentation.

 

Mr. Speaker, what is the background of this Budget Debate?

 

The PNP Government inherited a stable economy in January 2012, in which for the first time in a long time, all the major macroeconomic indices were simultaneously pointed in a positive direction.

 

– The Net International Reserves stood at US$2.0 billion with gross foreign exchange reserves at US$2.8 billion.

 

– The exchange rate was stable for over 2 years, at J$86:US$1.00

 

– Inflation was in the 6 percent range

 

– Interest rates – a key driver of new investments large and small – had reached single digit, with mortgage companies competing in single digit rates

 

– Confidence had returned among key stakeholders

 

– We left in place a blueprint for real reforms to taxation, pension and the public sector with the tabling and commencement of parliamentary review of Green Papers and a report of the Public Sector Transformation Unit (PSTU).

 

– Not surprisingly the economy, after the ravages of the global financial meltdown grew by 1.5 percent in 2011.

 

– Jobs were being created again from the expansion of the economy.

 

Mr. Speaker, this is what was left in place.

And let me state without any fear of contradiction that this stability was in place, despite the global recession, the massive increase in oil prices never seen since the 1970’s; the massive decrease in our bauxite revenue – only comparable to the 1980’s; and, despite the lack of IMF reviews under the previous Standby Agreement for several quarters.

 

And let me repeat, this lack of review was not due to any fundamental disagreement with the IMF – except on the issue of the pace of adjustment of major structural reforms as well as our decision to honour a contractual commitment to pay arrears to public sector workers – a decision we do not regret.

 

Indeed, the sister multilateral institutions, as late as November 2011 were sufficiently satisfied with the progress of the JLP government and signed off on US$318.0 million in development policy and project loans (water, energy and tax administration) from the World Bank and the IDB, respectively.

 

Mr. Speaker, this is the background that was left. It is the indisputable, irrefutable and incontrovertible truth.

 

Let me make it clear that the Opposition rejects without hesitation or equivocation, the politically charged assertion of the Minister, that when he took over “Jamaica was drifting on a sea of hopelessness and despair”.

 

Mr. Speaker, nobody either inside or outside of this House, believes such ridiculous statement.

But where are we today? Here is where the Minister’s words really fit. Sixteen (16) months after this government took over the reins of leadership with promises of a rapid IMF Agreement, abandonment of chicken back and steak and oxtail in abundance.

– The Net International Reserves has declined to less than the benchmark 12 weeks of imports, standing at US$884.0 million the lowest level in over 11 years.

 

– The exchange rate has slipped precipitously close to J$100.00 to US$1.00 with the re-emergence of a virulent Black Market for foreign exchange which is trading informally at between $105 and $110, and pricing now being done at higher levels. Some companies are quietly cutting staff as they are unable to get foreign exchange to purchase raw materials.

 

– In consequence, prices have moved to new and unprecedented atmospheric heights, with the price of basic foods increasing at an alarming rate, much higher than the officially stated average inflation rate. Basic foods prices have increased by a range of 20-60 percent over the past 16 months. Chicken back flew from $40 to $80 per pound, and a 2-pound loaf of bread has increased by $85 from $180 to $265. A whole chicken costing $700 is now a luxury for many.

– Mr. Speaker, people are suffering in Jamaica today. Fathers and mothers are struggling to keep food on the table and send their children to school. Farmers are trying their best with high prices for inputs, unpredictable weather and low prices for their produce and the Taxi man can’t make ends meet. His expenses are:

Earns /day $6,000

Gas $3,500

Owner’s fee $2,000

Take home $500

 

– The value of grants to PATH beneficiaries is shrinking with devaluation. People are hurting and reeling from punishing price increases from downtown to uptown. These punishing price increases across all sectors is marginalising the middle and working class and making the poorest of the poor more poor.

– Interest rates are beginning to point in the wrong direction again, threatening the stability of the real estate market and the opportunities from small business expansion. This is after we brought interest rates to the lowest period it has been for over 20 years.

 

– The unemployment rate is rising again. The unemployment rate was 13.7 percent at the end of October 2012 versus 13 percent when the Jamaica Labour Party left office. This is moving in the wrong direction despite this government’s promise of JEEP. The unemployment rate among young people was 35.3 percent in October 2012, 4.2 percentage points higher than the 31.1 percent reported for October 2011.

 

– And for the 5 consecutive quarters that this Government has been in charge, the economy has declined in every quarter.

 

– Not surprisingly, business confidence fell in the December quarter last year to its lowest in four years.

 

– The Jamaica Conference Board said that in the December quarter “Consumer confidence remained flat when compared with the previous quarter, but was less buoyant than before, having discarded the optimism they expressed at the top of the year following a change of government.”

 

Some say that the IMF might be too little, too late.

– Too little as there could be a negative outflow of funds to the IMF in the near term, and too late because the other multilateral flows may not be at a sufficiently rapid pace to adequately augment the decline in the NIR. This is so as the IDB and the World Bank will require unique performance measures of their own to trigger loan disbursements.

– In the meantime, ill-conceived taxation has been imposed without an informed framework, sharply increasing import fees, placing a burdensome 167 percent increase in property taxes on those who are tax compliant (which is likely to increase the delinquency rate), while re-imposing higher stamp duties and transfer taxes, corporate taxes, dividend taxes and assets taxes on businesses that would otherwise use these funds for expansion and job creation.

 

– In consequence, consumer and business confidence is down, purchasing power of consumers is down, and the economy continues to decline. Last year, we were told “it tun up till it bun up” now “it a dry up”.

 

– And while we boast that cutting the size of the Cabinet represents mere symbolism or “optics”, we can’t find money to send a little water to drought-stricken sections of the island while crops wither on the vine and rural folk are losing their livelihood. That’s not “optics” that’s real people suffering! The savings from the “optics” of a smaller Cabinet could truck water to suffering people.

 

– There is no doubt that poverty has increased over the past 15 months. The government must hasten the publication of the Jamaica Survey of Living Conditions, for which there has been no report since 2010

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Audley Shaw on Bang Belly Economics

Audley-ShawPart of Mr. Shaw Budget Presentation today…

In this Expenditure and Revenue Programme, the Government has targeted a Primary Balance of 7.5 percent and virtually a Balanced Budget. There are only two ways to achieve this:

(1) Create the environment for large-scale investment that generates growth and revenue, or

(2) Severely contract expenditure and impose high taxation which combined creates compression in the economy.

The Government has chosen this latter route, with the addition of the raid on public sector entities as an added feature.

They are counting on this raiding of the surpluses in public sector bodies to achieve this.

In this fiscal year the Government is planning to take approximately $32 billion (gross transfers) from the public bodies in comparison with $26 billion in 2012/2013. This is coming from $20 billion when we left Government in 2011.

The expenditure side of the public bodies are expected to decrease from approximately $300 billion in 2012/2013 to $280 billion in this fiscal year. This will be the first time in over a decade that expenditure in Public Bodies will be reduced.

This is a ‘bang belly’ theory of economics, where you don’t use economic policy to drive economic growth by building muscle that in turn generates incremental returns from a well oiled economic engine, you instead rely on this raid and on ill-conceived revenue windows that themselves are hostile to investment and growth. So you end up with a 21

‘bang belly’ hope of a balanced Budget without building sustainability and long term competitiveness.

In consequence, in the short term you might, with the best luck in the world, end up balancing the books but without growth, expansion and job creating wealth creation, you are not balancing peoples’ lives (stated objective of the Prime Minister). There is no nutrition in a bang belly economy to make a better life for the people. So we deprive people of housing benefits and claim that we balance the books from a no growth bang belly economy. We have no coherent incentive-driven tax policy that can drive growth, but we want to suck out revenue without a corresponding mechanism to encourage investment and earnings to create new revenue streams. That’s a bang belly economy that may achieve short term gains but will guarantee long-term pain because we will not balance peoples’ lives that are ravaged by joblessness, substandard housing solutions, high cost of living and marginal incomes. The surest sign of a ‘bang belly’ economy is one in which there is no growth yet we declare high primary surpluses and low deficits. How is that typically achieved? Not by runaway growth from new investment and expansion but by relentless compression in the economy and raiding the public sector entities, robbing them of their ability to adequately perform the role for which they were created. The last time we had a balanced budget was under the JLP Government in the 1980s when the economy achieved annual average 6 percent growth between 1986 and 1990 after a period of structural adjustment after the debacle of the mismanagement of the 1970s under the PNP. 22

For the remainder of this presentation I will chart a course for moving from a bang belly, no growth economy that is sucking out the lifeblood of what remains and instead show the way back to 6-10 percent growth rates.

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THE PRESS ASSOCIATION IS ALIVE! THERE IS HOPE

FreePress1PRESS RELEASE – “We note that Prime Minister Simpson-Miller has not granted any substantive interview since assuming that office more than 15 months ago despite formal and informal requests from media houses.”

PAJ PRESS RELEASE TODAY

The Press Association of Jamaica (PAJ) wishes to assure the people of Jamaica that our media practitioners remain committed to the search for truth and the holding to account of public and private officials to good governance and transparency in the conduct of their affairs on behalf of the public.

We hold sacred our commitment to pursue the truth, however inconvenient for some and in doing so will always endeavour to accord due respect for the offices of public officials.

The PAJ reiterates that we take seriously any credible charge that some journalists, in the course of conducting their duties, may have been disrespectful to anyone and remind media practitioners of their duty to show due respect to all regardless of their standing in the society.

However, we are concerned that there are deliberate efforts being made to shield the Prime Minister from facing questions on current and controversial national issues that demand answers and comment from her.

We note that Prime Minister Simpson-Miller has not granted any substantive interview since assuming that office more than 15 months ago despite formal and informal requests from media houses.

This is not good enough, especially at a time when the country is being bedeviled by chronic economic, social and governance problems.

The PAJ is prepared to meet with the administration to address any concerns it may have and give it an opportunity to resolve the issues working journalists are now having and welcome the invitation from minister with responsibility for information Sandrea Falconer to begin the discussions this Thursday.

Contact:

Arthur Hall

2ndVice President

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Statement from the Eldemire Family regarding the renaming of the Cornwall Regional Hospital

Eldemire

The Family of the late Dr. Herbert Eldemire has taken note of the story published in today’s Jamaica Observer newspaper regarding the proposed naming of the Cornwall Regional Hospital after Dr. Eldemire.

The family wishes to categorically state that it does not wish for the name of Dr. Eldemire to be dragged through the mud of political tribalism or be an object in the politically motivated actions of any person or organization.

It is with this in mind that the family wishes to make public its position that it is no longer in support of the renaming of the Hospital after of Dr. Herbert Eldemire.

Throughout his many decades of selfless public service to Jamaica, Dr. Herbert Eldemire was in no way associated with political tribalism, but worked tirelessly to make life better for Jamaicans. Given that he was not involved in such regressive actions during his life, we refuse to allow his name to be sullied by such actions in death.

We advise the Mayor of Montego Bay that there is now no need for any consultation with staff and or the citizenry on this matter. We hope that this decision will settle the issue and that our dear father’s name and spirit can rest in peace.

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BUNTING GIVES UP ON JAMAICA? – HE SAYS DIVINE INTERVENTION NEEDED

Bunting1

“I am going through a kind of dark night of the soul because we are trying very hard”

In his own words -Peter Bunting

Saturday – April 13, 2013 as captured by CVM TV – the verbatim transcript of a broken Minister of National Security, Peter Bunting.

“I think after 15 months I am convinced that the best efforts of the security forces by itself will not solve the crime problem in Jamaica but it is going to take divine intervention touching the hearts of a wide cross section of the society and using as the instruments of the divine intervention – the Ministers fraternal, the academics, the business community, those persons who work in the NGO community, those of us who are in political service – all to try and make an impact.

I am not embarrassed to say that right now as Minister of National Security (VOICE CRACKING MORE) I am going through a kind of dark night of the soul because we are trying very hard at the Ministry, I see the men and women of the security forces trying very hard, working night and day – long hours, I see the leadership – capable, competent, professional both of the police and the military and so much effort is being made and yet so little headway, such slow headway ahm is coming out in statistics.

And (LONG PAUSE – CRACKING VOICE) and it really takes a lot of faith to keep working and going in the face of this and of course I am happy that I have so many aaaah persons of faith to encourage and support not just myself but all of the security forces at this time”

2 mins 27 seconds
224 words

Source: http://thecrooksofit.livejournal.com/1974.html

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GOVT MINISTER AZAN & IN YOUR FACE CORRUPTION ?

azan

G2K described as disturbing, reports in the media regarding the establishment of shops in the Spalding Market and the alleged interference of the Minister of State and Member of Parliament, Mr. Richard Azan. The organisation has called upon the Prime Minister to immediately address the issue.

 

“With the Mayor of May Pen alleging political interference from a Minister of State, it is critical that the Prime Minister launch a full investigation into the matter. If the allegations are in fact proven to be true, the Prime Minister must act swiftly as Members of Parliament ought not to be allowed to flout the rules and disregard the concepts of transparency and probity. This has been a long standing problem with our politics and we must put an end to it” said Floyd Green President of Generation 2000

The organisation noted that the reports thus far call into question the process by which it was decided that the particular contractor would build the shops on Land controlled by the Parish Council, and the relationship between Mr. Azan and the contractor stemming from reports that monies were paid into the office of the Member of Parliament.

 

“The allegations reek of corruption and will continue to fuel the perception that Jamaica is a corrupt country. The PM must act decisively to convince Jamaicans and the International community that she is serious about removing corruption from Governance.” added Green

The organisation called upon the PM to immediately indicate:

  • Whether the construction of the shops were put to tender?
  • Whether the shops were constructed from government funds?
  • Whether the construction of the shops was granted the necessary Parish Council Approval and if the requisite application fees were paid?
  • Whether the Mayor attempted to get the Council to approve payment for the construction of the shops after they had been constructed?
  • The amount of monies collected thus far from the rental and who they were paid to?
  • Who authorisied a member of the office staff of Mr. Azan to collect money on behalf of the contractor?
  • A detailed account of all the projects that this contractor has been awarded in the constituency since January 2012

SUNDAY GLEANER REPORT

Mystery shops and a meddling minister – Contractor collecting rent for buildings in Spalding Market; rent money paid to agent at government minister’s constituency office

Published: Sunday | April 7, 2013

Tyrone Reid, Senior Staff Reporter

There is something odd about the recently renovated Spalding Market which is owned and operated by the Clarendon Parish Council.

A contractor, with alleged ties to the governing People’s National Party, constructed shops to the rear of the market and rented them to vendors without permission from the parish council.

To compound the matter, the vendors were told to pay the monthly rent at the North West Clarendon constituency office of the member of parliament and state minister in the Ministry of Transport, Works and Housing, Richard Azan.

The Clarendon Parish Council had no knowledge of the rent agreement and gave no approval and this has sparked a probe by the police.

A member of the council has also written to Auditor General Pamela Monroe Ellis asking her to investigate why money that should have been going into the parish council’s coffers was being collected by an employee at Azan’s constituency office.

Late last week, Azan told The Sunday Gleaner that he was aware of some of the details.

According to Azan, when the refurbishing of the market was taking place, he tried to see if he could find investors to put their money into the construction of the shops.

“They (the investors) were reluctant as they did not want to be collecting rent from the occupants of the shops. They were just not interested. So the contractor was approached and he agreed to build the shops,” said Azan.

The member of parliament added that when the issue of rental of the shops came about, the contractor did not want to have anything to do with collecting the money and “that’s how the employee in my office became involved, acting as the go-between and collecting the rent on his behalf”.

“As of now, I will not get myself involved in any more problems pertaining to the Clarendon Parish Council because there are some in the council who feel that the town should remain dirty like how they left it.

“I am having no more discussion on the matter because this seems to be an effort to retain the nastiness in the town,” declared Azan.

He said talks had been initiated about how much the contractor would pay the council and these were still ongoing.

The rental agreements that were issued to the vendors for the wooden structures without electricity, piped water and bathroom facilities show the owner of the shops as John Bryant, the contractor who did phase one of the repair of the market.

Monthly charge

A copy of the contract obtained by The Sunday Gleaner showed that the tenants were charged $5,000 per month with a security deposit of $5,000.

The rental agreement states that “all rents and notices are to (be) given at the North West Clarendon constituency office”.

In cases of emergency, tenants were instructed to contact Bridget Dixon-Daley, an employee at the constituency office, and Bryant.

When contacted initially by a member of our news team, Bryant said that the shops were no longer under his control.

“To tell you the truth, to get one of the little shops them you have to go through the parish council in May Pen. I am out of it now. It turn over to the parish council,” he said.

Later Bryant admitted that he had rented the shops.

“The lady that collected the money didn’t collect it for the North West (Clarendon constituency office), she collected it for me. A me ask her to do it for me,” he said.

“A me do the finishing up of the market, I was the contractor. Some vendors who they wanted off the road suggest to me about (building) the shops and I said okay I would do something temporary for them, but it would be handed over to the parish council. It was the people and me idea,” added Bryant.

He admitted that no prior approval was sought or granted by the parish council to construct the shops on its property and charge rent for them.

Bryan claimed that a $500 commission was paid to a third party from each rent payment.

“I admitted to them (the parish council) and the investigators that I went about it the wrong way (and) I stopped collecting rent in March,” said Bryant as he noted that he is yet to turn over any of the rent money to the parish council.

When asked if the member of parliament was aware of the operation, Bryant said he was not sure.

“To tell you the God truth, I don’t know if Mr Azan knew.”

When contacted, the employee, Daley-Dixon, said she has been told that the shops are now under the control of the Clarendon Parish Council.

Paid at constituency office

One former tenant told The Sunday Gleaner that between September last year and January of this year she paid her rent at Azan’s constituency office.

“What I had to do in January is give up my shop because there was no light down there for $5,000 a month and we couldn’t afford it. But I am interested in getting back a shop,” she told our news team.

However, when our news team visited the market last week, wires were seen from some shops to the electricity supply which is paid for by the parish council.

Meanwhile, Milton Brown, former mayor of May Pen, told our news team that the matter was brought to his attention about two months ago.

“I didn’t know on what basis they were built. It came up at a parish council meeting; someone asked how they were being rented,” he recalled.

“It was said that they are privately owned. I wondered what was the arrangement and if the council was being compensated,” added Brown, the councillor for the MineralHeights division in the parish.

Brown said the council’s superintendent of roads and works was instructed to do an estimate in order to compensate the contractor who built the shops.

That suggestion did not go down well with “some councillors on the opposition side who said he should be jailed and not compensated”.

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Mrs. Simpson Miller, the exit is to your left – T.H.I.N.K Jamaica

Exit

By Durie D of T.H.I.N.K Jamaica

This clearly isn’t working out.  It really isn’t.  It makes no sense we skirt around, tip-toe, speak in hushed tones, beat around the bush on this issue.  IT’S NOT WORKING OUT.

Now, barring the fact that I find it distasteful when Mrs. Simpson Miller refers to those who oppose her (including the Opposition) as “some people” and “people” (what is this, Grade 3?), it is becoming increasingly apparent that the Prime Minister may not have that sense of responsibility and diplomacy that comes with the esteemed office.

I’m being kind.  I am.

Today, when Mrs. Simpson Miller was questioned on a particular issue, her response was, “This isn’t a press conference!”  What.  On.  Earth???  So as Prime Minister, the only time one should expect a response to a question from her is at a scheduled press conference?  Does that make sense to anyone?  Anyone???

Splashed across international media today is the news report that President Obama will be taking a pay-cut.  When asked by a CVM reporter if she would even consider cutting the size of her Break…um…Cabinet, Mrs. Simpson Miller responded with something to the effect of “Everyone is focused on the IMF…WE will have to work hard in Jamaica…” (paraphrased).

Wait…what???

It was also reported that journalists pointed out to her that Obama took a 5% pay-cut, and when they asked if her Government would consider making similar sacrifices, she said something to the effect of “I have turned down many requests for overseas travel to conferences”and “I do not live at Vale Royal as I don’t want tax-payers to pay”.

[blank stare]

So the grand sacrifice is to do fewer speaking engagements, as well as to not live at the official residence of the Prime Minister, for which upkeep and maintenance would STILL have to be paid, whether or not the PM occupies the dwelling?

Oh. I see.  [looks around] Okay…where are the cameras?  WHERE ARE THE HIDDEN CAMERAS?!  This HAS TO be a joke.

I have to admit that I seriously badmind (yes, BADMIND) entire nations for their leadership.  It’s THAT serious.   There are 7 billion people on the face of the earth and THIS is the leadership that Jamaica is stuck with for the next four years.

[raises eyes to the heavens] *sigh* Dear Lord, a wah we do?

I’m in denial.  I refuse to accept that this is all there is to the leadership that Mrs. Simpson Miller has to offer.  And before others come out and say she’s being so heavily criticised because she is a woman, I’ll say this: It simply CANNOT be that our PM does not feel compelled to perform up to the standard for which she and many other women before her have worked so hard to achieve.  WOMEN DID NOT PUSH TO BREAK THE GLASS CEILING JUST TO SETTLE FOR BEING MEDIOCRE.

I honestly don’t know if we should expect more or better from this Government. Minister after minister come on the news telling the citizenry to “hold strain” and that “hope springs eternal”. People are now having to pay a 150%-300% increase on their property taxes, while the Prime Minister “sacrifices” overseas travel.  Poppyshow!

@Sparky_Channer tweets: “I would have believed PSM more if she said she saved the country a bunch of money by switching to Geico, than those BS reasons.”

‘Nuff said.

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