Former Prime Minister Owen?Arthur has described the 2010 Financial Statement and Budgetary?proposals presented by?Minister of Finance Chris Sinckler on Monday as the closest thing to a “karaoke budget”.
Delivering the Opposition Barbados Labour Party’s (BLP) reply to the Budget earlier today in the House of Assembly,?Arthur charged that the International?Monetary Fund’s (IMF) 2009 Article IV consultation was what to too large an extent was informing the policies of the Government of Barbados.
“They have been written into and have been used as the basis of the preparation of the Medium Term Fiscal Strategy, and as the basis for the change in the VAT [rate] ,” he said.
“I don’t want to say that this might have been the closest thing that we have ever had in this House of a Karaoke budget. He [Sinckler] was singing the song but the script was written for him by somebody else!”
Arthur informed the House that the Article IV report suggested that the VAT rate be changed by 2 per cent which was what this Government has done [2.5 per cent].
According to him, there was an even more fundamental problem in dealing with the IMF which was the issue of so-called fiscal consolidation and debt sustainability which had become the new mantra for the IMF.
Arthur said the IMF was not “a wicked institution made up of wicked people” but it has a limited mandate, that is, to manage the post-World War II international economy in which exchange rates of all countries were fixed centred on the United States currency which in turn had its value fixed in terms of ounces of gold.
He said the IMF was given a mandate to keep that world economy stable by exercising surveillance of exchange rates under Article IV to make sure the countries were doing what they had to do and keep their exchange rate stable. (AB)
