Sooner or later, we will have to confront the hard choices that we have not prepared ourselves for
By Rattan Khushiram
The MSM-ML government had it all set. With the 2019-20 elections in mind they had a well-crafted list of programmes, projects, activities, slogans, events and some “tour de force” that they expected would find traction among the voters. Very soon they realised that, given their inability to present voters with a palatable alternative, why not woo them with opportunistic politics and poll lollipops and some other populist measures to sway them and cash in on whatever disenchantment, however small, they may have?
First on their list was the 2019-20 Budget, which would rely on the magician’s wand of Pravind Jugnauth – straddling both the highly demanding Ministry of Finance and Prime Minister’s Office – to deliver a panoply of feel-good policies and giveaways. A please-all budget which the Government was expecting would have a lasting impact and would sail them victoriously through the forthcoming elections. But it turned out to be a damp squid.
Not taken aback, the regime’s strategists came up with a still more populist and bolder off-budget grand scheme. Why not build up the image of the PM as an avant-gardiste leader who has at heart not only the corporate sector but also the rights of our workers? It was also going to provide the necessary ammunitions with which to target their archrival under whose regime the “anti-worker” Employment Relations Act was promulgated and implemented?
As the minimum wage awards were beginning to cause havoc in the Export Oriented Enterprises and the SME sectors, they needed a prop, a potent slogan that appeals to the gut, not the head. Why not therefore a pro-worker stance, advertised in huge characters on larger-than-life billboards of the long-awaited national hero, à la Anquetil and Rozemont, who against all odds was ready with its new Workers’ Rights Bill to chase and fight the corporate windmills? But the corporate sector, not too happy with this new posture of the regime, which they thought had gone too far in its advertised pro-worker stance, decided to put its foot down. Stealthily, at the stroke of midnight, while the unions had lowered their guard, with help of some Ministry officials they watered down the too “anti -business” Bill and made sure that it had to go through an exhaustive process of committees and assessments before it could be implemented.
Without being downcasted by the wretched turn of events and the failure to gain traction among voters, Government thought that it could still rely on the Indian Ocean Games capitalising on the brand-new sports complex and the national fervour at its best. As for the sports complex, unfortunately it was not ready for the games and the football stadium was a poor comparison to our more spacious and imposing George IV stadium. The national fervour disappeared very soon after the games despite the public holiday and the celebrations.
It was more or less the same story with the papal visit. They were expecting to garner the national élan of piousness and fervour in their favour. The piousness was indeed present throughout the Pope’s visit but the national élan melted very soon. But voters did, however, take note of the Pope’s concerns about the challenges facing the country namely rising inequality, youth unemployment, climate change issues and the scourge of drugs.
There was still the Metro Express, which was not just a new transport infrastructure but advertised as the dream of a “modern, liveable, vibrant and environmentally-friendly Smart Mauritius”. It was a perfect exhibit in the government’s bid to create legacies and leave imprints on public memory and thus sway opinions in favour of the regime. He would be rubbing shoulders with Narendra Modi who succeeded in prodding us towards a revision of our DTAA with a “generous” package that included a grant of some Rs 9 billion for the Metro Express. But some minor setbacks spoiled the whole programme. The Metro Express project was running late. For the inauguration, only the Rose-Hill-Richelieu portion was ready and PM Modi preferred to connect with the regime via video-conferencing for the grand event.
Then came the Roches Noires case. This could be said to be the turning point of the political narrative. The mainstay of that narrative that was carefully constructed by the regime was to change the political atmosphere in the run-up to the elections and take on its direct challenger in the coming polls. The Roche-Noires case was also the turning point in the sense that it proved to be the tocsin that warned them that they were no longer calling the shots; they have lost their grip on the evolving political narrative and failed to keep track with the changing dynamics.
The recent announcement of the promise of increasing the old-age pension to Rs 13,500 should not be taken as part of the same political narrative that was meticulously planned by government. This latest announcement is an outlier, not in the same line of schemes/projects as the earlier ones. It is not a proposal from a position of strength. It is a tactic worthy of the scorched earth policy – “après moi, le deluge” — a last-ditch attempt to salvage the regime given the odds stacked against it..
The generous old-age pension increases in the past have led to pension spending pressures which have put at risk both the long-term financial sustainability of the pension system and fiscal sustainability. This has been highlighted in the latest IMF Article IV report, which recommended “a gradual fiscal consolidation beginning with the next budget for FY2019/20 to enhance fiscal credibility and to put public debt on a declining path.” But this regime’s abdication of its responsibility and retreat from sound macro-economic management of the country are reflected in the consolidated budget deficit higher than 5% of GDP and an elevated Public Sector Debt nearing 70% of GDP. There is little doubt that the Mauritian economy is in distress. Nearly all economic indicators highlight this concern.
Such policies leaning towards freebies while toning down the development agenda will spook investors, rattle our fragile economy and take it to the brink of a crisis which will soon be evidenced in the further depreciation of the rupee and a downgrading by Moody’s. Moreover, with the projected decline in the workforce and an increase in dependency ratio, the increase in pensions spending will not only pose fiscal risks but also crowd out other priority expenditures, meaning the economy will be further engulfed in its present abyss.
Sooner or later, we will have to confront the hard choices that we have not prepared ourselves for. Voters are very much aware of these much needed reforms and the generational costs of the pension system and its impact on the future for their children, grandchildren and increasingly great-grandchildren. They also aware that that the country cannot presently afford the luxury of having a regime which does not have the gumption to take bold measures.
The country needs a strong government that will take Mauritius in the right direction, not one that will expose the nation to a bankruptcy of ideas but has the ability and tremendous potential to alter the political and economic narrative and convince voters of the sincerity of its purpose.
* Published in print edition on 4 October 2019