No more welfare state

protectionism era is ending - warns Arthur

Former Prime Minister Owen Arthur today sounded a stern warning to Barbadians that the era of the ‘welfare state’, in which citizens were guaranteed free social services and other entitlements “paid for by a plethora of taxes” was fast coming to an end.

In fact, while likening the Barbados economy to a speeding vehicle, he cautioned that it was fast approaching a dead end and therefore urgently needed to change course in order to avoid plunging into a calamitous “developmental trap”.

“I say to you that a developmental model based on protectionism, trade preferences, unique tax benefits and on economic sectors which do not make the fullest use of our human capital will lead Barbados into an economic cul-de-sac,” he told participants in the Innovate Barbados 2017 conference at the Lloyd Erskine Sandiford Centre this morning.

Without making direct reference to any of the current fiscal policies of the Freundel Stuart administration or the recent promises by Opposition Leader Mia Mottley that if elected, the Barbados Labour Party will make tertiary education free again and will immediately repeal the dreaded National Social Responsibility Levy, Arthur cautioned that the heavy provision of welfare services by the state was no longer sustainable.

“Barbados is following the development model pursued in Nordic countries by providing its citizens with a wide array of social services and entitlements paid for by a plethora of taxes.

“Nordic countries, however, support their welfare systems by exhibiting and maintaining some of the most liberalized and technologically dynamic business systems that can be found anywhere in the world . . . [and] are at the top of the global competitive indices, the ease of doing business and every index, not because of the high taxes, but because they have the most dynamic business,” he cautioned, in a seeming dig at both sides of the political divide.

It was in his Budget presentation on May 30 that Minister of Finance Chris Sinckler unveiled a $542 million austerity package aimed at closing the island’s worrying deficit of $537 million.

However, based on Acting Central Bank Governor Cleviston Haynes’ review earlier this week of the performance of the economy for the first nine months of the year, some hard political decisions still have to be made in terms of state spending, with a view to erasing the country’s worrying deficit, estimated at $279 million for the last six months, as well as stopping the free fall of international foreign reserves, which plummeted further below the 12 weeks benchmark to reach just 8.6 weeks of import or $549.7 million at the end of September, putting more pressure on the stability of the Barbados dollar.

During his presentation Arthur made no mention of the review, but he was insistent that there must be a new model of development in which innovation, technology and entrepreneurship are the principal drivers of economic and social activity.

The former Prime Minister, who in the past has called for the privatization of some state-owned entities and abandonment of some welfare support programmes, stressed that Barbados simply could not afford to continue to “confer massive benefits on our citizens through entitlements without equally becoming technologically dynamic and changing our business culture as the basis on which we generate income.

“Therefore, we need a willingness to liberalize our business environment because without such liberalization the impulses for technological development will continue to be stifled in this country,” he said as he addressed the topic, Small can be Smart.

He pointed out that other small countries had already embarked on programmes to become more innovative and technologically advanced, while cautioning that “Barbados may fail if it doesn’t embark on a similar endeavour”.

“The need for Barbados to move to a higher stage of technological sophistication derives from the fact that its transitional drivers and enablers of economic development and social platforms have been eroded in value overtime by adverse effects and now operate as fully depreciated assets,” the respected economist said, pointing to the shift in focus from one industry to the next in Barbados over the years.

“Barbados’ future will surely come to depend upon how it responds to the challenges being thrown out by what has come to be termed the fourth industrial evolution,” he said.

Further outlining his vision of change for the island’s development, he said there was also a need for the development of a “new class of indigenous international businessmen”.

“Barbados’ international business and financial industry does not have to be foreign driven or dependent only on the visions in tax treaties and the like. The development must now be made responsive to technological imperatives,” Arthur said, adding that industrial policies would also have to be redefined to lessen the reliance of businesses on subsidies and fiscal incentives.

He said for the changes to take place the financial system, which is currently highly liquid but risk averse, should also be more willing to finance more innovative and technologically based start-ups.


49 Responses to No more welfare state

  1. Lisa Moore
    Lisa Moore November 2, 2017 at 9:24 pm

    This message needs to be preached but as usual it will be criticised. I blame government for this mendicant mindset by its citizens. Thank you Mr. Arthur

    • Ricardo Worrell
      Ricardo Worrell November 2, 2017 at 9:38 pm

      Oh really!!! I think its time ppl stop paying taxes to government n use their money to take care of themselves ,then we’ll see who the real mendicants are

    • Lisa Moore
      Lisa Moore November 2, 2017 at 9:39 pm

      Ricardo tell your boss not to take it out of your salary, lead by example.

    • Eddy Murray
      Eddy Murray November 2, 2017 at 9:51 pm

      Ricardo Worrell. We are paying the money to ourselves, but the legislators dipping in there hands

    • Ali Baba
      Ali Baba November 2, 2017 at 10:05 pm


    • Peter Lowe
      Peter Lowe November 2, 2017 at 10:10 pm

      When He was with the BLP you were not thanking Him….and what are you thanking Him for now? For talking crap

  2. Alwin Ellis
    Alwin Ellis November 2, 2017 at 9:39 pm

    So what all Barbadians should do is stop paying RH Taxes.Let we see how wunna will get the country run then.Country running off of taxpayers money and wunna getting on like we don,t deserve something in return

    • Kayden Jada
      Kayden Jada November 2, 2017 at 9:44 pm

      Agree with your comment 100%.

    • Eddy Murray
      Eddy Murray November 2, 2017 at 9:47 pm

      You know I does ask the same question every single day, where is the freeness when I have to pay taxes. Let me keep my money in my pocket and you charge for users fees simple as that

  3. Ricardo Worrell
    Ricardo Worrell November 2, 2017 at 9:43 pm

    Imagine ppl take your money misuse it then call u a beggar when ask u them to provide the services you paid them for

    • Kayden Jada
      Kayden Jada November 2, 2017 at 9:46 pm

      He getting old and out of touch.

    • Gloria mendes November 3, 2017 at 8:00 am

      Couldn’t have sad it better

      • Gloria mendes November 3, 2017 at 8:02 am

        My reply couldn’t have said it better was to Ricardo’ Worrell’s comment. Not kayden Jada. S. I have great respect for Mr Owen Arthur. And at least he is talking sense

  4. Stanton Peace
    Stanton Peace November 2, 2017 at 9:54 pm

    These politicians amaze me,we are paying a wide variety of taxes and more increased taxes and you call Barbados a welfare state the DLP has boasted of collecting over 22 billion in taxes over the last 9 years and almost 100 million since NSRL was introduced so not one hell bout here ain’t free it’s all taxpayer funded,stop saying things are freely given to bajans it’s wrong.

    • Jennifer November 3, 2017 at 9:30 am

      @Stanton Peace – very true on your comment.

  5. Saga Boy November 2, 2017 at 9:54 pm

    Good in theory. The challenge is the implementation. One has to fight against the current culture; the current private sector which does not like innovation etc etc. Politicians have gotten people used to depending on them in order to maintain power. What is interesting is that he is throwing cold water on Mia’s proposals. What is obvious is that we need to change the current economic model. We need to earn our way. We can only achieve this if we work together.

  6. Peter Lowe
    Peter Lowe November 2, 2017 at 10:07 pm

    I often wonder why He still in parliament talking BS…..He need to go and rest himself

  7. Nicholas Mackie
    Nicholas Mackie November 2, 2017 at 10:13 pm

    Not likely

  8. Saga Boy November 2, 2017 at 10:58 pm

    Some people on this threat don’t seem to have a brain. How many of you can afford to pay the economic cost of social services? Can you imagine what would happen if we had to pay economic cost of transportation, health, education, use of the roads etc?

  9. Jennifer November 3, 2017 at 3:34 am

    This Owen Arthur can really STFU. You sound ingrunt.

    • Jennifer November 3, 2017 at 3:41 am

      Now u go and lie down so as not to keep spitting in your own face and the face of the DISENFRANCHISED so called bajan working class.

      • Jennifer November 3, 2017 at 3:44 am

        Mind you his mindset will be also the mindset of his cohorts.

  10. jrsmith November 3, 2017 at 6:02 am

    I am not taking side , dont care where you are you cannot have faith in or trust politicians … In this case I agree with his paragraphs 1 to 3 this should be taken on board by our black masses …………………
    Our real problem in barbados a top heavy political infrastructure , with people who have not the faintest idea of running barbados LTD………..They are of the idea that taxes can rebuild the economy …… You could try asking the government when last our island had a full audit ………………T
    his lack of having an efficient organise government is way ,way in the distant future…
    The government is a family and good friends set up who must be blame for everything which is wrong in barbados , we are suppose to be educated and we are still shuffling A4 sheets of paper from desk to desk , wasting time and lives ………………………….
    What will happen if this government wins the next election , very frightening ……………………

    • Jennifer November 3, 2017 at 6:48 am

      @Jrsmith – hail – I agree from your second paragraph down. But please remember that this man along with all of his predecessors is who caused all of this mislead, metal laziness, and psychological brutality to this people. For the benefit of both them and the 1% of Barbados. Those people were also trained to run things in such a manner also. Watch how they take no responsibility either for their wickedness. Like if this people were not always human capital.

      • Jennifer November 3, 2017 at 7:29 am

        What he is saying in the last paragraph should have been done from the time slavery so said “ended”, but they went the human capital route, which we are currently STUCK in including this tourism fiasco. They should have concentrated on the building of this people in the areas of innovation, tech and manufacturing, via a UNIQUE education system like >>>>>>> CHINA/Japan. But these politicians used the masses with trinkets and lies by following the said Nordic/European countries. Mind you china and them now into manufacturing ROBOTS to WORK too. So now he is on his knees polishing the floor with his azz in the air. He puts me in the mind of that ex central bank Governor. However, the disabled, social ills, and the needy will always be in all societies and should be helped where possible. All of this island downfall will boil back to the DECISIONS they made 50yrs ago. Believe you me.

        • Jennifer November 3, 2017 at 7:46 am

          So the question remains – how do we solve this problem/crisis – which these guys created. Every facet and system needs to be revamped TO INCLUDE THE MAJORITY peoples development in the said tech and innovation>>>>>>>> like a Barbados – exit. And that will now pose real MAJOR problems seeing that the financial tomb is waiting and the race is well and truly started and we have major forerunners. Mind you all of this is what happens to sheeple peoples.

          • Jennifer November 3, 2017 at 8:07 am

            And sadly when these politicians talk about such development they DO NOT mean black people being developed in Barbados – least that shoe causes irritations of corns and calluses. It is usually the development of the minority peoples while the majority masses remain in their respective positions fighting for degrees and masters in the cave hill financial pit to then FALL into those pigeon holes. The hole matrix is like this constant whipping boy. And many people here in bim have no problem whatsoever with this set up either.

  11. archy perch November 3, 2017 at 6:18 am

    The former Mr. BLP himself now persona non grata should be more specific and talk directly to the stupid proposals of me owl. Santa Claus change his gender and with forked tongue.
    Owen needs to come clean and tell us the truth about me owl. He also needs to tell the country about his then party’s successes and failures, and the difficulties he encountered especially 2005;6 and 7. He needs to tell us what was his rational for all the borrowing he executed.He needs to tell us why he allowed some ministers to squander so much money i useless projects i.e Liz Thompson with those stupid houses in the Ministry courtyard yah remember?
    That expensive beach toilets at Oistins et al. We need to hear from Owen. Clearing the aie and sheddig light on these things would clense him of ALL his sins – and render him the title of being A Statesman.

  12. Sheron Inniss November 3, 2017 at 6:25 am

    Right now what Mr Arthur is saying is true. We don’t have the money or if we do it is being wasted. Right now I am looking for one flat tax and that’s it; like in Cayman.

  13. MARIA Holder November 3, 2017 at 6:26 am

    We mAy still have issues with the Messenger but the message is sound. I can spend my money better than the state can, of this I am sure. I wish that I had control over paying taxes because if I had the control I would not pay a cent. I do not rely on any of the social services, yet a large portion of my salary goes to taxation and I cannot get a good road to drive on, my tax refund, to mention a few

  14. harry turnover November 3, 2017 at 6:47 am

    Owen..ya face look very fat …wha happen ,ya off de likers all together now ?

  15. Yogi Ni November 3, 2017 at 7:18 am

    It is really sad that some of us as Barbadian are so ignorant and backward . We need to be more objective and show a greater level of intelligence. It bothers me that so many people here seem not to be getting the message Owen Arthur is giving. He delivered a very important message. If we as Barbadians do not take such messages seriously we all will perish. Right now the ship Barbados is sinking , taking on a lot of water , and the captain and his crew don’t even seems bothered. By the way Mia’s promise of reinstating free university education is a promise to fools. For the last 15 years I’ve been say it is not sustainable.
    They are many competent people with good ideas that can take Barbados into the future, but we have become too partisan and only think of self interest.

  16. Greengiant November 3, 2017 at 7:55 am

    What he is saying is totally true. Pity he couldn’t see that and begin the restructuring of social services during his time in office. The social services needed to be restructured gradually, he had the levels of revenue, the foreign exchange, and the time in office to make the changes, yet all he did was increase the country’s expenditure.

    Economics is a trial and error trade, you learn from mistakes. Some your own, and some from others. So Arthur has the experience, on both sides having mislead economies in Jamaica, and Barbados. He can write books on it now, and that’s why there’s an economic society, so ideas, theories and errors can be shared, reviewed and fine tuned for the varying size economies. So now we see that our current Minister of finance is still a student of the game.

  17. Dr Anthony Cummins November 3, 2017 at 7:59 am

    This is what I am talking about. Do we need more clarity and simplicity than that. We can not get out of a recession by taxing and over taxing. We must be innovative and the financial institutions MUST be willing to take some risks so to help the innovation because innovation and financial support is like hand n glove.. Tehnology must be taken to the next level. Do you believe we are still struggling with the notion of free wifi. Stupseee in the 21 centry when we have long passed the technological age and far into the information age? So yeah come on lwts put our minds together and be creative.

    • hcalndre November 3, 2017 at 10:54 pm

      Hello Doc; Ever so often all Barbados is a producing a bunch of lawyers that is serving no real purpose and can`t see any people in the technical field. In a small island like Barbados you can get lawyers a dozen a dime and no innovators for today`s world.

  18. Freeagent November 3, 2017 at 8:14 am

    The honourable Owen Arthur is correct in stating that we can no longer afford the welfare state, although he should have recognized that when he was in power and money was flowing. The late Errol Barrow introduced those welfare measures when we were slaves in the agricultural fields. He wanted to give us true independence. However, we are no longer creeping; we can now stand on our feet.

  19. Lee November 3, 2017 at 9:03 am

    Owen, Barbadians will only appreciate what you are saying when they hit bottom. Other regional countries with ten times the economic potential of Barbados hit bottom before waking up to the realities of independence under a labour regime. The honeymoon is over. We’ll all be sucking salt by next October unless we stop blaming the system and make our contributions.

    • hcalndre November 3, 2017 at 10:57 pm

      @Lee; Contributions like paying more taxes?

  20. Adrian Hinds November 3, 2017 at 9:57 am

    My Prime Minister. The only one that has earned that title and that I would vote for in such a capacity.

    A new economics governance model is needed; however it will not occur without a new political governance model.

    Until Barbadians can popularly vote for their Prime Minister and until ministerial positions are not held by elected members of parliament we will never see the political will to do what many in the political class knows needs to be done.

  21. Donild Trimp November 3, 2017 at 10:48 am

    @ Jennifer –
    “This Owen Arthur can really STFU. You sound ingrunt”.

    Jennifer, is that really you?

    I do not understand. Sad !!!!!!!!

    • Jennifer November 3, 2017 at 12:23 pm

      @Donild – If there is one person in BIM who is not blind or play that politics game is me. He does NOT have this people in mind and my people will remain at the same spot, believe you me, so now that he is trying to awake he can STFU. This thing goes much deeper than you can even begin to comprehend.

      • Jennifer November 3, 2017 at 12:28 pm

        And if you are coming from a Christian perspective, I don’t play that lying azz game either.

  22. Donild Trimp November 3, 2017 at 12:44 pm

    @ Jennifer –
    “there must be a new model of development in which innovation, technology and entrepreneurship are the principal drivers of economic and social activity”

    Makes sense to me.

    Why would you be against the above? That statement seems to cover all the principles you stand for.

    What am I getting wrong here?

    • Jennifer November 3, 2017 at 12:59 pm

      So how will you start to endorse this??? Donild.

      • Jennifer November 3, 2017 at 1:12 pm

        Or how do u think any government will/can bring this to fruition??????

  23. Milli Watt November 3, 2017 at 4:52 pm

    the message I don’t have a problem with but the messenger however could go and stand up in the middle no not middle more like left of center a Spring Garden after 7:00 p.m

  24. Alex Alleyne November 3, 2017 at 7:10 pm

    The days of “Freeness” are coming to and end. No more free Lunch. Get with it of head for the grave yard.

  25. hcalndre November 3, 2017 at 11:12 pm

    Something here is bothering me and although some people in Barbados do get free rides especially the politicians, what about the poor and disabled? The high taxes that the people pays into the government what will it be used for besides pay the same politicians`s salary and then what?

  26. Mark Adamson November 4, 2017 at 8:32 am

    We in the PDC have been saying it for years that there must be

    1) a new model of development evolved for Barbados,
    2) a new model of governance for the country,

    3) a new model of institutional finance for it.

    The current models of those classes were not suited to our greatest possible development as a nation of people that was originally created to assist in the realization of imperialist exploitation expansion purposes of the particular British colonial political enslavers exploiters.

    The current models of those classes were brought about to help foster and achieve the objectives of sustaining as much as possible – and through different phases – psychological ideologies and social activities that can be described as international/local westernism/eurocentrism, oligarchism, exploitation and dependency.

    From a Barbadian democratic nationalist and black masses and middle classes points of view, such models were bound to fail and flounder substantially, as they were flawed and fraudulent in their essences and operations and upon the ideological, psychological and political premises they were based.


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