Economic adviser to the Barbados Labour Party, Dr Clyde Mascoll, made this dire prediction today while addressing a Press conference at the offices of the Leader of the Opposition. Arguing that Barbados is now experiencing its darkest hour, Mascoll said: “The number you are hearing in relation to saving Government’s expenditure does not make sense. If you are sending home 3,000 workers and you can save $143 million in a given year, it means that the average worker’s salary that you are sending home has to be just over $4,726.
Now I know that the average public sector worker does not earn close to $4,800 per month. So therefore again the truth is not being told in relation to the extent of the adjustment that has to be made, because even as I speak to you the Government has finally conceded that its fiscal problem is of a magnitude greater than $800 million per annum.
“What is more important however, is that the $800 million is the bottom end and the Government’s capital programme is less than $100 million. Therefore, the gap that has to be corrected is in excess of $700 million in any given fiscal year. We know that most of Government spending on the current side has to do with employing people.
“When you take account of interest payments that cannot be touched; when you take account of goods and services, which would mean the medicines, drugs and ointments at the hospital, the pencils and the chalk, I am saying to you therefore that the adjustment of which we are speaking would have to come from the wages and salaries side,” Mascoll added.
Mascoll, who is an economist, maintained that with a deficit of $800 million the level of retrenchment would be more than an economy could bear.
He stressed that the $143 million cut per annum talked about by Sinckler was less than a quarter of what is required to get the country out of “this dark hole”. Addressing the issue of devaluation, Mascoll said: “I warned Governor of the Central Bank, Dr DeLisle Worrell, to desist from talking about the value of the Barbados dollar.
There is no need to even introduce a notion of devaluation in this country because this country cannot afford to even speak about devaluation. His report does inspire confidence because the economy is not expected to grow. “When the Governor tells you that the economy is going to grow by 0.2 per cent you can ignore it because it can either be minus 0.5 per cent or it could possibly be 0.6 per cent or so. But then again he is the one who said that no one had a magic bullet or no one is a fortune teller.