Unsustainable growth rate of pensions will be corrected – PM

The rate of growth of pensions in St Vincent and the Grenadines is unsustainable, a situation which the Prime Minister says he intends to correct.

During the presentation of the Estimates to Parliament yesterday, Prime Minister and Minister of Finance Dr Ralph Gonsalves said during the 2016 fiscal year, actual pensions paid amounted to $54.6 million, an 11.4 per cent increase over the comparative period for 2015.

The total current budget for the same period in 2016 over 2015 increased by only 3.4 per cent.

“It is clear that rate of growth in pensions has consistently outpaced rate of growth in total current expenditure.”

The Prime Minister described this as an unsustainable situation which he intends to correct.

“This is one that I do not intend to leave for the next generation of leaders.”

In 2017, an estimated $56 million has been budgeted for pension payments, which represents a 7.7 per cent or $4 million increase over the $52 million provided in 2016 for pensions.

The Prime Minister also noted that there was an increase of 12.7 per cent or $118.8 million in the 2017 total budget for ‘Other Transfers’.

Gonsalves noted that the growth in that category is mainly related to the cost associated with the imminent opening of the Argyle International Airport (AIA).

The subvention allocated to the Tourism Authority has been increased by $5.4 million to meet the cost of international airline guarantees and marketing support.

Additionally, a new subvention of $5 million has been included on the aviation services programme to provide financial support to the AIA.

Other transfers in a broad expenditure heading include: grants to local and other agencies – $67.9 million; contribution to domestic and foreign organizations – $20.8 million; social assistance both in cash and in kind – $19.2 million; training – $10.8 million, medical benefits – $0.18 million for a total amount of $118.8 million.(CM)