THA wants $3.9B for Fiscal 2023

By Sue-Ann Wayow

THE island of Tobago has been for years been allocated a small portion of the financial pie shared between Trinidad and Tobago and steps are being taken to rectify this.

This was the commitment made by Chief Secretary of the Tobago House of Assembly (THA) Farley Augustine in his inaugural budget presentation on Thursday.

Augustine said with previous allocations, it was difficult for Tobago to invest in any major substantial development.

The THA total estimated expenditure for fiscal 2023 is pegged at $3.97 billion.

The total estimated expenditure of the Assembly was predicated on a forecasted National Budget of $57.4 billion, an increase of $1.9 billion in fiscal 2023 and an allocation of 6.9 per cent to the THA in keeping with the upper end of the Dispute Resolution Committee (DRC) recommendation.

Augustine who also heads the Division of Finance, Trade and the Economy, presented the budget at the Assembly Chamber, Jerningham Street in Scarborough under the theme “Working towards a smarter, greener, more autonomous Tobago.”

It is the first budget to be presented by the Progressive Democratic Patriots (PDP) administration.  He also said the recurrent expenditure for fiscal 2023 represented an increase of $992 million over the parliamentary allocation for fiscal 2022.

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Augustine had strong words regarding the allocation to Tobago from Central Government.

He said, “The current constitutional arrangements that established the twin-island Republic of Trinidad and Tobago have limited, if not denied outright, entitlement of all Tobago Governments, since this colonially arranged marriage, to the political and policy powers of the Budget, due to uncertainties associated with the revenues to be allocated to Tobago by the Central Government.

“In the May 15th, 2022 Midyear Budget Review, the Minister of Finance increased the national budget by $3.082 billion but only allocated $60 million or 1.95 per cent to the THA. This does not look like an oversight but is rather a deliberate contradiction to the recommendations of the Dispute Resolution Committee (DRC) that were accepted and approved by parliament in 2000. But whether oversight or deliberate omission, it is a breach of the law which stipulates that the THA should be awarded between 4.03 per cent-6.9 per cent of the National Budget. Madam Presiding Officer, I am putting the nation on notice that this disregard will not be allowed to continue any longer. New Tobago dispensation, new rules of engagement!”

While placing the budget against the backdrop of three major disruptive global events , the Covid-19 pandemic, the Russian-Ukraine war and climate change, Augustine admitted that economic recession, growing unemployment, growing world food shortage, high inflation and tension are all associated with those events.

He spoke about the budgetary allocation for the THA.

Since 2017,  the THA requested $4.8 billion but received $2.3 billion for the fiscal years 2017-2022, which is approximately 47 per cent of its overall budgetary request and therefore such allocations cannot finance the launch of a serious development programme in Tobago. 

“Urgent steps are needed to address this investment deficit, starting in Fiscal 2023,” Augustine said.

Speaking about the energy sector of which Trinidad continue to be heavily reliant on for its main source of revenue, Augustine said that there was the continuing need for budget policy in Tobago to be designed to stimulate meaningful development in order to lead the diversification of national exports while creating significant productivity growth to create buffers against imported inflation and generate foreign exchange.

Revenue sharing 

Augustine said in the move to better governance, given the recent discoveries of oil and gas in the waters around Tobago, it was time to return to the bargaining table to negotiate a new revenue-sharing agreement between Tobago and Trinidad.

“This will be the starting point of our conversation(s) with the Prime Minister and the Minister of Finance in respect of Tobago’s allocation for development spending in fiscal 2023. As a matter of fact, Tobago and Trinidad should advance the conversation to include consideration of formulae for sharing of natural resources, consensual exploration of these resources and reward sharing,” he said.

Augustine said with the establishment of an Energy Bureau, through the Office of the Deputy Chief Secretary, support would be rallied internationally for the island’s just dues.

Augustine added that for the past seven years, there was a decline in Tobago’s GDP but modest GDP growth was expected in 2022 and 2023.

He said the most recent data on prices available from the Central Bank suggest that Tobago recorded headline and food price inflation in March 2022 of 3.9 per cent and 6.3 per cent, respectively. 

Given trends in the national and international markets, the forecast is for continued rising inflation in Fiscal 2023 which signalled the need to boost defence against inflation.

The Chief Secretary also listed out many areas for development across Tobago under the current estimations.

The recurrent estimates for Fiscal 2023 totalling $3.07 billion are  as follows: 

The recurrent estimates disaggregated by Divisions for fiscal 2023 are: