Minister of Finance Chris Sinckler’s feature address to the 185th anniversary celebration luncheon of the Barbados Chamber of Commerce and Industry on Wednesday was important, not simply because any speech from any regional minister of finance in these difficult economic times is necessarily of gravity, but because critical issues which must be tackled before they adversely affect our standard of living were put on the table. They deserve ongoing and constructive debate.
The minister spoke in a serious way of the problem of statutory corporations and their cost to the taxpayer, as well as the way in which they function.
These statutory bodies were said to be necessary to bring greater efficiency to governmental action, and to ensure the speedier delivery of services to the public.
In many respects the procedures of the traditional Civil Service were thought to be too cumbersome and too heavily laden with bureaucracy, and delegating some executive authority to these parastatal agencies was seen as the answer; but for some time now, this view has been questioned.
Mr Sinckler’s public responsibility as Minister of Finance and his observations have led him to speak to these issues. He remarked on the absence of Local Government for many years, and how such absence and the emergence of statutory corporations had led to what he calls “overlapping and duplicating statutory bureaucratic entities which have grown exponentially but void of any noticeable efficiency and quality increases”.
In the minister’s view, they have become wholly inefficient in service delivery, extremely costly to maintain and weak in managerial and operational systems. At a structural level, several can no longer effectively and efficiently deliver to the public they are to serve.
These are strong words, but they are based on experience and empirical observation. And a man of Mr Sinckler’s long executive and administrative experience before he became a minister, together with his experience as Cabinet minister, places him in a good position to speak with authority on these issues.
Although he says statutory corporations were necessary at the time, he thinks that too many of them have become very similar to the Central Covernment administration which they were mandated to help.
About a year ago, Sir Courtney Blackman, a former Central Bank of Barbados governor, also agreed that the statutory corporations were established for valid reasons; but he added that with the exception of the Central Bank and the Insurance Corporation of Barbados, the overall performance of the statutory corporations had been unacceptable.
The question which arises is: what is it that the Central Bank and the Insurance Corporation did right that the others have not?
Whatever the answer, the minister has a major task on his hands, for there is no easy solution to this problem.
Sir Courtney has also called in the past for a significant and dramatic shake-up in the quality of management in the Civil Service and the statutory corporations as a prelude to increased productivity.
Our own Mr Charlie Skeete, retired economist adviser with the Inter-American Development Bank, and Richard Francis, analyst with Standard & Poor’s, were urging Government in 2008 to consider rationalizing state enterprises with a view to shutting some of them down and cutting the fiscal deficit.
Nothing in Mr Sinckler’s speech suggests that he is following the approach to shut down any such corporations, and the Government has set itself to maintain employment. He seems more inclined to urge efficiency and better delivery of service, of which the Central Bank and the Insurance Corporation of Barbados are such exemplars!
In the final analysis, the question is whether the economy can afford inefficiencies within the statutory corporations when they account for more than 40 per cent of current expenditure.
This is an important debate which must be conducted without the emotion of rabble -rousing, but with due consideration for the consequences of any plan of action that may eventually be decided upon, and its impact on our standard of living.
