Wednesday, April 24, 2024

Salary increase could help economy


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A BADLY NEEDED INCREASE in salaries to public servants, even on a pyramidal scale, could well be the strategy to increase economic growth in Barbados – once it is not too generous to cause the economy to overheat like those given in the 1980s and 90s, and force us into the hands of the International Monetary Fund (IMF).

The increase by Tom Adams in the 80s made everyone happy, but he was almost incognito when he went to the IMF. But people had money to spend. We have lived well over the years and this is the time for us to, as the old politicians used to say, get accustomed to sacrifice. Barbados is not exempt from suffering.

However, this increase should be spent on locally produced goods wherever possible. This would ease the drain on foreign currency. Do we have the products to substitute for imports?

This is my mantra for local agricultural resurgence and, by extension, manufacturing. Perhaps some consumer durables could be restricted, like some white goods, fridges, stoves and imported furniture. Do we have the capacity?

Can we imagine the amount of reserves spent on new vehicles? True, this is a good source of revenue for Government, but 130 000 and counting?

Drain on reserves

The amount spent on parts is also a vast drain on foreign reserves. Anyone visiting Barbados would not suspect that we are in a recession.

We have to brainstorm and look at creative measures to stimulate the economy. Get away from the economic jargon. Barbados needs to come out of the doldrums. We cannot tax our way out. Taxation further shrinks our disposable income. We are having to draw down our savings, except those who have a feathered nest of eggs.

Try something new! With banks offering [little] on deposits and also imposing a plethora of charges, further cuts in civil servant numbers can lead to immediate implosion.

I have no deep knowledge, except some cursory knowledge gleaned from marketing. The political directorate needs to set the tone for stimulating [the economy] and put a framework and guidelines for the private sector to follow stringently.

Some correlation has to exist between salary increases for public servants and not random increases which some think they are entitled to for the same level of productivity. More efficient service is also needed, bearing in mind that their salaries come from the people’s taxes.

Finally, tax defaulters out of conscience need to pay up. The country needs it!



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