TP Saran

Budget 2011: Time For Some Dedicated Lines?

 

TP Saran

 

As was to be expected, the Budget has been received with mixed feelings and reactions. Depending upon one’s (vested) interest, approach or ideology, different parts of the Budget have been welcomed or criticized. But, again, as usual, the Minister of Finance has had to keep within limits wherein he has to try, first of all, to generate revenues for the State so that he can: accommodate electoral promises, encourage industrial development, promote tourism, lead to job creation, expand educational opportunities, and address social issues amongst others.

It is a real juggling act, and the Budget no doubt also bears the stamp of the technical slant and baggage which are factored into its preparation.

 

Cost-cutting and cost-recovery are two tools which, used properly, can lead to the much touted efficiency gains that are desired in any sector or ministry. The Minister of Finance mentioned that while bureaucracy is here to stay, it must be creative and innovative. The point is whether his officers are willing to listen to or allow for some of these innovative ideas to be implemented, or whether they prefer to maintain rigidities so as not to disturb their comfort zones?

For example, cost-recovery could have been combined with allocation of some dedicated lines to encourage departmental autonomy and development, and given a boost to staff in certain areas. Even a small percentage, say 5 to 10% of recovered revenue — the rest going to the Consolidated Fund — could have been ploughed back at source. This would have sent a strong signal that those who perform can expect to be rewarded by measures that would improve the functioning of their respective divisions and sectors.

This is the case with government laboratories, which need continuous upgrading of equipment and training of staff. The brains at the Ministry of Finance could surely work out a standard procedure, with oversight from the CPB, to ensure the transparent utilization of such funds. For example, setting a standing committee made up of the members from staff who rotate at regular intervals. They would decide about equipment to buy on a priority basis, and be given the leeway to avoid the cumbersome bureaucratic procedures that cause considerable delays, not to mention frustrations. This would inevitably lead to a more efficient service. Further, instead of waiting to be offered training slots abroad, such training could be planned ahead and opportunities sought and paid for, even if partially.

Similarly with the taxes on tobacco, alcohol and gaming. The revenue collected from these sources will be quite substantial. The example of some developed countries could have been followed, where part of this revenue is put to use (in the case of alcohol and tobacco) in educational campaigns aimed at the public and meant to combat these wrong habits, and with success. It goes without saying that such campaigns involve personnel who need to be trained in the preparation of materials, field workers who have to work closely with small groups, besides having to engage professional advertising firms which tend to be expensive.

One union representative has pointed out that the Budget contains no measures for single lady street vendors. One can notice that their numbers seem to have increased of late, and mostly of course they are from the lower strata of society trying to eke out a living. Unfortunately social and family breakdowns are more and more frequent, and women with children bear the brunt of this burden. They certainly need to be supported, and perhaps in the days to come the voice of the representative in favour of this group, and thus the group itself, may be given the attention that it undoubtedly deserves.

Indeed, street vending is an important informal sector in many countries, the developing ones in particular, and in Mauritius it is completely unregulated. But it represents an important informal sector in which considerable numbers of people earn their living, and if it is properly regulated this will bring about order in the heavily politically nurtured chaos that is currently its sad reality.

Which brings us to one feature in the Budget which has generated some cynicism: what amounts to a catalogue of legislations announced. Their proper place is the Government programme. Whoever advised the Minister of Finance to include them in the Budget? Be that as it may, it is public knowledge that several of them have been mentioned in previous Government programmes, and there has been no movement forward for the simple reason that the means to do so were not put at the disposal of those concerned with those legislations.

Additionally, there are policy issues that got stuck at higher levels, with no wish to tackle them head-on. Without such policy inputs and the institutional enabling elements, the announcements have remained declarations of intent. It is known that the best way to facilitate development and economic growth is to continually improve and update the regulatory bodies that exist, and create new robust ones where needed. Hopefully, this time round things will be different.

Another item in the Budget is the considerable sums earmarked for various feasibility studies. How many reports of such studies, and sector strategies, are lying dormant? That is because many of these did not take into account sufficiently the local context and realities, or if they did, the proposals threatened the status quo. If this is not to the advantage of certain people or interest groups, there will be no interest on following up on these reports. Perhaps the Minister of Finance should be more rigorous as regards future feasibility studies, and insist more on making best use of what exists already in each sector before allowing these costly exercises to proceed.

Overall, therefore, a more cautious and critical approach has to be adopted in the implementation of all the measures that the Budget has provided for, before another Annual Audit Report comes up with the familiar litany of unjustified expenditures and avoidable wastages.

 

TP Saran

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