Government cannot afford one-off, one month tax-free payment – PM

Teachers and public servants here will at no time in the near future receive a month’s tax-free salary that will cost the Government EC$25 million.

This is simply because the Unity Labour Party (ULP) administration cannot afford it.{{more}}

On Monday, during a press conference at Cabinet Room, Prime Minister Dr Ralph Gonsalves spoke about the tax-free salary proposal made by the St Vincent and the Grenadines Teachers Union (SVGTU), a discussion that has been ongoing for some time now and has created some tension between the Government and the SVGTU.

“The Government cannot afford that in addition to all its other monthly expenses”, Dr Gonsalves told a group of journalists on Monday, stating that money is only borrowed for capital and not recurrent expenditure.

The Prime Minister (PM) revealed that during recent meetings with the SVGTU, he was asked if he could pay half, some EC$12.5 million, “and I said I can’t afford half either and they said, can’t you say any number? And I said, believe me, I would do my best, but I can’t say a specific number.”

Gonsalves said that persons must never expect him to play electoral politics with salary enhancement, “because that is not my style,” while revealing that he is committed to giving an increase in 2016, “because the signs are there for a modest three per cent growth,” according to the International Monetary Fund (IMF).

He stressed that the $25 million increase is a hefty increase, given the economic downturn globally, while this country has spent millions of dollars to fix the effects of natural disasters.

He noted, however, that since 2001, teachers and members of the public service have seen an increase of over 40 per cent, while there are teachers that the reclassification process gave an increase of 60 per cent, and persons working at the hospital in certain jobs who were affected by reclassification have seen between 50 per cent and 106 per cent increases.

Gonsalves noted that while there has been no increase over the past few years, SVG is not alone in this regard, as countries, like the United Kingdom, have had wage freezes.

“I’m not saying they don’t deserve one,” said the PM, who stressed that a number of things must be taken into consideration when discussing these matters.

He said that bonuses and one-off payments are good, but if revenues are being affected by outside factors, it is always better to give people an increase that can be added to their salary, so that they can benefit. He said that locally, persons have not had wage increases, but they have had salary enhancements.

The PM stressed that public servants and teachers are vital to the country and he wants no quarrel with them, but it is impossible to come up with the money at this point. He said that one can take into consideration what the Government has done as it relates to expenditure on secondary and primary education since 2001 to now, “phenomenal increases,” while the number of teachers hired has also increased since 2001.

It was noted also that the Government has to appoint more graduate teachers and provisions will be made in the new budget for more numbers.

“I am not interested in an argument…they have done well under this Government and if they are to get $25 million, I can’t do it by trimming existing programmes,” said the PM, adding that to pay that money, he would have to slash or eliminate programmes like YES, SETT, Home Help for the Elderly and the Public Assistance Benefits programmes, while he would also have to stop providing subsidy for transportation and cut down on scholarships and student loans.

“I can do it, but none of us would like what it would look like. The country would be worse off,” stressed the PM.(LC)