One cannot disagree with the fact that since assuming Government in 1995 the Denzil Douglas Labour Party has put a tight stranglehold on our economy and our citizens. Our nation is riddled with debt caused by the reckless spending of this Douglas administration. Additionally, never before in the history of this federation has citizens been choked with such a great tax burden. This reality is indeed in stark contrast to words echoed by Denzil Douglas shortly after becoming minister of finance in 1995. He stated in his budget address dated December 18th 1995 and I quote "While in opposition, the St. Kitts - Nevis Labour party agitated for change to the manner in which we do business in this country. We felt that the fiscal policies pursued by the then Government were ill-advised and ofttimes counterproductive. We felt they were too hard on the poor," end of quote. Some twelve years later one has the opportunity to analyse the tax policies of Denzil Douglas. One can only conclude that his tax policies have led to a greater barrage of taxes thereby reducing the middle class and plunging more and more citizens into the abyss of poverty. Now, what are the causes of this high level of taxation and how have the taxes affected our citizens, especially the most vulnerable amongst us, the poor?
In his December 1995 Budget Address, PM Douglas stated:
"Mr. Speaker, the public finances have presented a serious challenge to us since we assumed office in July 1995. We inherited an overdraft at the National Bank of $20.9 million and the rest of the public debt stood at over $200 million."
In its report on St. Kitts - Nevis dated April 2007 the IMF says that the public debt at the end of 2005 stands at approximately 190% of our gross domestic product (GDP) and is the highest in the world having surpassed that of Lebanon. The debt therefore equates to over $2.4 billion. Hence, twelve years later the public debt is some 10 times larger but the Prime Minister has dismissed it as public debt his ass.
Our ability to sustain this debt must be of key importance to all citizens. While we may be able to afford to meet the payments today one must ask, at whose expense is the debt being repaid? It is being repaid at a very high expense and crippling effect on all citizens. Page 21 of the IMF report states and I quote, "Debt service costs, as a share of GDP, are now the highest in the region and significantly exceed expenditures on health and education, and if unaddressed will constrain the ability to address priority concerns," end of quote. The above quote is simply telling us that government is now spending more money on the repayment of debt than it spends for critical services such as for health care and education. Furthermore, key services such as the work of the police against crime, the paving of roads, supply of electricity and the payment of salaries by government to its workers are in jeopardy because of the high debt saddled on our backs by Denzil Douglas. Every single spent to repay the huge debt is at the expense of the school child who finds himself not being able to collect any books from SELF because government cannot afford to purchase them. It is at the expense of the teacher who has to personally buy paper to photocopy exams and at the disadvantage of the child suffering from the shortage of chairs and desks. It is at the expense of the children preparing for exams in science and computer labs that are poorly furnished. It is at the expense of the diabetic senior citizens who cannot get their medication from the government pharmacy because government cannot afford to purchase basic medication for the poor and needy or the poor who must pay $10 to have their prescription for aspirin filled. It is also at the expense of residents in government projects in Old Road, Basseterre, Sandy Point, Newton Ground and Cayon who continually complain of unpaved roads which government cannot find money to fix. It is at the expense of the police officers who work in rat infested, dilapidated buildings. It is also at the expense of the electricity consumers who are faced with electrical outages and damaged appliances on a daily basis without any compensation. The monies used to repay the numerous loans such as the $250 million in respect of Lavallee to fence grass and abandoned canefields, the $30 million for problematic mireless generators, the $6 million for a football stand which has now been demolished, etc all borrowed by Denzil Douglas government would have been spent in providing these key services.
In order to mitigate this government's debt from spiraling even further and further out of control, Dr. Douglas and his government have waged a nasty war on the citizens of this country by levying more and more burdensome taxes every fiscal year. As per the IMF, we now have the enviable distinction of being the second highest taxed country within the OECS. We have been confronted with harsh increases in Consumption Tax on imported goods from 15 % in 1995 to 22 ½% today, not to mention the cynical way in which Consumption tax is added on duty, (a tax on a tax). The introduction and increase in numerous other taxes and user fees have been forced on us, such as Customs Service Charges, travel tax, vehicle taxes, airport fees, social services levy, electrical surcharge, dog license id tax, environmental levy, hospital fees, housing levy and cell phone tax to name just a few. The government has piled on draconian increases in the rates of basic human services - electricity rates went up 33%, and water rates up 600% in one single increase. Many poor people who did not even have to pay for some of these services such as water in 1995, now find themselves subject to disconnection if they cannot meet the high water bills that they now face now that they have meters installed on their properties. Imagine, poor people having their water disconnected! While this is happening we hear of the family and friends who can afford to pay who have had thousands of dollars owing to the electricity department written off.
Our citizens are living daily in financial turmoil unable to meet their daily needs. The cost of living has increased drastically under the Douglas administration. A basket of goods costing $150 in 1995 brings little more than half that basket today at the Supermarket. Government fees at Government depts keep being introduced. Government land which was allocated at 0.60 cents per square foot in 1995, now goes for $4.00 per square ft unless you are a foreign investor who can dictate your cost at 68 cents per square foot.
The increase in taxes has led to an astronomical increase in the cost of doing business and the cost of living. Wages have remained almost constant and have been far outpaced by the cost of living. As such, citizens are practically living from paycheck to paycheck. The minimum wage of $250 per week or $1000 per month which many of our citizens work for cannot sustain a family and I repeat, cannot sustain a family. A single mother of two who works for $1000 per month has a take home pay of $$950 after social security deductions. A very mildly conservative budget for this family can look like the following
Mortgage on a Govt super low income home $413
Electricity $190
Water $ 60
Food $300
Cable basic package $ 32
With those five bills only she has expenses of $992 which is more than her take home pay. One would realize that no monies were included in her budget for bus fee to and from work, medical expenses if one of the kids become sick, no telephone expense, nothing for clothes, a tank of gas to cook or even two new panties for the mother. This is the financial turmoil endured by many citizens throughout the length and breadth of this federation. They have numerous bills to pay, numerous taxes to shoulder and insufficient money to afford the basic necessities of life. This stressful situation was brought about by fiscal mismanagement which has led to a humongous public debt and high taxes which are the legacy of Denzil Douglas' government.
Denzil Douglas in a recent radio call in programme said that he needed an increase in salary and justified it by asking a number of questions. He asked if he aint have children to feed too, and a mortgage to pay and if he aint got to eat. Today the same questions are asked of him, don't citizens have children to feed, a mortgage to pay and dont they have to eat? What is he doing to ease the tax burden?
Civil Servants last received a 10% increase in salary in 2004, almost three years ago. Prior to then, electricity has been increased by 33% and gas by 16%. Consumption tax had moved by 12.5%, driver license fees and wheel tax jumped by 25%, and customs service charge exploded by 20%. Departure tax at the airport had been increased by some 300% and the import tax on macaroni and sodas was increased by 50%. Since the increase there has been the fuel surcharge which is about an additional 80% of the billed amount and a tax on local telephone calls. In essence, while the cost of living has been steadily increasing, the purchasing power of the poor man has been decreasing.
Dr Douglas has always claimed that the Labour party Government is the party of the poor. One would agree that there cannot be a party of the poor unless there are poor people. Hence, it is the policy of the Douglas government to ensure that most citizens forever remain poor. Under PAM there was a thriving middle class and a growing small business sector. Taxes were kept at a minimum and government was managed efficiently. Under a new PAm government, policies will be pursued to ensure that all citizens have a more comfortable standard of living and move many of our citizens from poverty. We will rebuild the middle class.
