The 2019 Budget Review – Part Three

On the 13^th May 2019 the Minister of Finance of Trinidad and Tobago, Colm Imbert, presented his 2019 Mid-Year Budget Review. In this third blog entry we complete our analysis of the main contents of that presentation and the implications of the review for the citizens of Trinidad and Tobago.

Supplemental Expenditure

A supplemental expenditure request was made for an additional TT$1.839 billion to cover 18 key areas. Those areas are:

1. The Judiciary: TT$57.682 million for payment of salaries, filling critical positions, arrears on rent and renewal of key software used in the Family Court.
2. The Service Commissions: TT$3 million for security services and the assessment of senior officials in the public sector.
3. The Office of the Prime Minister: TT$12 million to meet the operational costs of the Children’s Authority and for payment for children assigned to private community residences.
4. The Ministry of Finance: TT$709 million to reimburse the Infrastructure Development Fund for amounts related to the closure of parts of Petrotrin.
5. The Comptroller of Accounts: TT$18 million for pensions and gratuities for contract officers.
6. The Ministry of National Security: TT$200 million for CCTV camera services and other assorted services. In addition, TT$7 million will be set aside to meet the maintenance costs of vessels used by the Trinidad and Tobago Coast Guard.
7. The Ministry of Attorney General and Legal Affairs: TT$50 million for legal fees.
8. The Ministry of Education: TT$50 million for examination invigilators, school caterers, and examination fees for students.
9. The Ministry of Labour and Small Enterprise Development: TT$39.3 million for the On the Job Training (OJT) Programme.
10. The Ministry of Public Utilities: TT$200 million to meet outstanding payments to DESALCOTT for the supply of desalinated water.
11. The Ministry of Rural Development and Local Government: TT$39 million for salaries for municipal police officers, provision of water trucking services, and rent.
12. The Ministry of Works and Transport: TT$85.7 million for employees and for the charter of a passenger vessel to service the Tobago Seabridge.
13. The Trinidad and Tobago Police Service: TT$75 million for salaries and allowances, payment of rent and utilities, and equipment acquisition costs.
14. The Ministry of Foreign and CARICOM Affairs: TT$1.6 million for equipment purchases. In addition, TT$4.2 million will be provided for refurbishing the Embassy in Washington and the High Commission in London.
15. The Ministry of Communications: TT$10 million for TTT live broadcasting productions.
16. The Ministry of Social Development and Family Services: TT$227.5 million to meet increases in senior citizens pensions and payments to flood victims.
17. The Public Sector Investment Programme: TT$2 million to outfit a new building.
18. The Ministry of Housing and Urban Development: TT$48 million for the refurbishment of HDC apartments, for the Housing and Village Improvement Programme, and for works to be completed in Port of Spain.

Procurement

The newly formed Office of Procurement Regulation (OPR) is nearly fully staffed and the software it will use is currently being installed. The software will allow for the establishment of a comprehensive database relating to all areas of procurement. The Procurement Depository is expected to be accessible within the next three months.

A revised version of the Procurement Regulations has received public comment and would be submitted to the Ministry of Finance and the Procurement Regulator shortly.

The new Procurement Regulations are expected to be in place within 9 months.

Signs that things are getting better

The Minister highlighted a number of factors to support the administrations contention that they have stabilised the economy and Trinidad and Tobago is on the road to economic recovery.

Those factors included:

• Consumer credit has grown from TT$51 billion in December 2015 to TT$58 billion in December 2018.
• Retail prices increased by less than 1% in the period from March 2018 to March 2019.
• Food inflation has been contained at 2% per year.
• The value of life insurance contracts written in Trinidad and Tobago has grown from TT$3.8 billion in 2015 to TT$4.4 billion in 2018.
• Mortgage lending has increased significantly since 2015.
• Vehicle sales continue to surge with over 25,000 new registrations per year. The total number of vehicles on the road now exceeds 1 million.

Whether citizens agree with the government’s contention that things are “getting better” will ultimately only be tested and fully known at the next election.

Another tax amnesty

In light of the intention to shortly establish the new Revenue Authority to replace the Board of Inland Revenue (BIR) and the need to allow that entity and taxpayers to start with a clean slate, a three-month tax amnesty will commence in mid-June 2019. This amnesty will extend to all forms of taxation and appropriate legislation to give effect to the amnesty will shortly be introduced into the House of Representatives.

The Minister warned that taxpayers should take advantage of the amnesty if they are in arrears with filings because once the new Revenue Authority takes over from the BIR further amnesties are unlikely.

Your Thoughts?

What are you most hopeful about for the current and coming fiscal years? Do you see any opportunities you plan to leverage? Most importantly, are you ready to put your money to work? Madam. Sir. It is time for you to contact us. 628-1175 or info@firstlinesecurities.com.