BASSETERRE, St Kitts – Prime Minister Dr. Denzil Douglas today presented an EC$400.9 million (US$148.4 million) budget to Parliament outlining a series of tax measures as the twin island Federation grapples with a global economic crisis which “is expected to continue or have a similar dampening effect on revenue collections for 2012”.
In a three-hour presentation that was boycotted by opposition legislators, Douglas said his administration has once again cut back substantially on recurrent and capital Expenditure for the new fiscal year in order to maintain fiscal stability.
But he told legislators “there are a number of critical services such as education, health, safety and security as well as social assistance that his government, which has a multi-million dollar Standby Agreement (SBA) with the International Monetary Fund (IMF), must deliver.
“Careful attention has therefore been taken to provide adequate resources to ensure that the quality and scope of these services are not in any way compromised,” he said.
According to Douglas, who is also the Minister of Finance, recurrent revenue for 2012 has been estimated at EC$401.3 million (US$ 148.6 million), which is EC$31.6 million (US$11.7 million) below the 2011 Estimate of EC$432.9 million (US$160.4 million).
Douglas said the major portion of this decrease can be attributed to the loss of revenue from the Electricity Department.
He told Parliament that the The St. Kitts Electricity Company is now fully operational and therefore revenue and expenditure in respect of the Electricity Department is no longer included in Government’s Budget for 2012.
On the other hand, recurrent expenditure for 2012, excluding loan principal payments, has been pegged EC$400.9 million, which Dr. Douglas said is EC$398.9 (US$147.7 million) or 0.1 per cent less than the 2011 Estimate of EC$401.3 million (US$148.6 million).
Douglas told legislators that the measures introduced in the fiscal package has taken into consideration the IMF’s loan agreement introduced in 2011 with “a debt restructuring strategy aimed at bringing public debt to sustainable levels so that by 2020 we will meet the ECCB (East Caribbean Central Bank) Monetary Council’s target for debt to gross domestic product (GDP) ratio of 60 per cent. (CMC)