The 2020 budget has arrived, and it is a curious budget in several ways.
It proposes that the Government will do the following, inter alia:
• Spend $5 billion more than we earn.
• Maintain the status quo of reliance on initiatives and fortunes in the energy sector for our financial salvation and “maintenance” of our standard of living.
• Do little about diversification of the non-energy sector to promote far more export earnings even though, especially since the crash of energy earnings since 2014, that sector has been earning twice as much as the energy sector.
• Make agriculture completely tax-free while driving more nails into the coffin of that sector by increasing by 15 per cent the wages of thousands of CEPEP and URP workers, who will be disincentivised to look in that direction and will continue to be unproductive workers.
• Increase the minimum wage by $2.50, “benefiting” 194,000 low-income workers who, along with the CEPEP and URP workers, will then discover that their increases will be consumed by rising consumer prices, some of them unjustified and greedy.
• Leave Tobago dependent and mendicant with a development budget of only $232 million while spending $7 billion on a single project —the San Fernando to Point Fortin highway extension—in Trinidad.
• Develop tourism in Tobago without putting in place a national innovation system as necessary infrastructure for such development.
But there are measures proposed in Budget 2020 which make me feel good, very good, for example: abolition of the requirement for government pensioners to submit life certificates twice per year; elimination of arrival forms at our airports; increase of the tax credit re solar water heating equipment to the full amount of the cost (though only up to a maximum of $10,000); increase in the number of OJT trainees to 8,000 and of their stipend by ten per cent; increase of the tax allowance from $3 million to $6 million for corporate sponsorship of nationals working in our creative industries; indexing of public service pensions (some time after 2020); provision of a minimum pension of $3,500 to daily-paid public servants (sometime in 2020); elimination of Styrofoam and single-use plastics; and extension of the promotional expenses allowance to first-time exporters to the Caricom market.
But the measures that give me the sweetest satisfaction, on the personal level, are the measures in respect of cooperatives and credit unions.
I have been a credit union man since the early 1980s and I have been a leader in the three secondary bodies: the CCULTT (Co-operative Credit Union League of Trinidad and Tobago, where I was president for nine years), the CUDIF (Credit Union Deposit Insurance Fund), and the CFF (Central Finance Facility). So I have been a part—critical, I think —of the leadership that has been relentlessly pushing for legislative reform for credit unions and non-financial co-operatives that not only brings better, more modern regulation but also levels the financial playing field for credit unions.
The 2020 budget has four measures that benefit the CCUM (Co-operative Credit Union Movement), and while they do not exhaust the needs that we have, they promise to be far better than what we have had since we began serious lobbying for change some 30 years ago. I rejoice over the fact!
The first measure is the amendment of the Co-operative Societies Act of 1971 to “increase the current limit of $5,000 imposed on the transfer of shares or payable interest to a nominated beneficiary upon death of a member to $50,000.” In other words, what some of us called “the funeral grant” will go up tenfold! From January 1, 2020!
The second measure is enablement of the payment of utility bills by co-operative societies and credit unions. Such a simple need and such a simple provision, and yet it has taken all of 48 years for it to happen. The banks have had it from inception, but credit unions are only now getting it!
The third measure is the creation of a “new independent authority to govern the co-operative sector”, which will have far more rational and effective powers and purposes, and will be a part of the Ministry of Finance and so will report to the Minister of Finance. (Currently, we are regulated by the Commissioner for Co-operative Development through the Co-operative Division of the Ministry of Labour and Small Enterprise Development, which urgently needs both more staff and more highly qualified staff.)
Indeed, in a post-budget chat with Minister LeHunte, as Chair of the Cabinet-appointed Committee of Ministers set up to consult with leaders of the CCUM, I was assured that, as agreed, the Authority will be set up within 6-12 months and the CCUM will be represented by three members of their choice in a nine-member board.
The fourth and final measure is that – but only after the establishment of the Authority – credit unions will be allowed to ‘offer banking or quasi-banking services, such as encashment of government cheques and teller services.’ Let’s hope the Government establishes the Authority before the general election of 2020!
Now there is more than a little in Budget 2020 that suggests that the Cabinet was thinking of the election. The CEPEP and URP increases. The OJT increases. The increase of the minimum wage for 194,000 persons. The introduction of a pension for daily-paid workers. There can be no doubt: the Government has thrown bones to the lower-income classes, who are largely members of credit unions, in an election year.
And – I hope I am not being uncharitable here – it has thrown four to the CCUM. Take a bow, Minister LeHunte!
Did you know that there are half-a-million accounts in the CCUM?