by Prime Minister Dr Keith Mitchell
Tuesday April 9, 2013
Ladies and Gentlemen,
I am pleased to report tonight that the government that you voted into office seven weeks ago, has settled down well and hit the ground running.
We have set about the task of wresting the fiscal headache, stabilizing the economic situation and preparing a foundation for sustainable growth.
These are early days and there are obviously many challenges ahead, but we are pleased with the direction of the first few weeks.
There has been a return of confidence in the local economy, and without any major measures yet taking effect, many businesses have reported an uptick in activities.
This is because Grenadians are confident about the prospects — and rightly so.
We are determined particularly to tackle the issue of high unemployment, and we have set about the task manfully.
For the many people out of work — and who have been on the breadline for far too long — the long-awaited job cannot come too soon.
We have kept our promise so far of saving the jobs of every one. We have resisted the culture of political witch-hunts and there has been no victimization.
The only people that have gone home are those who were contracted under the arrangement the previous administration made under the new system of the office of the Prime Minister and his Chief of Staff; and some in the youth programme.
Those people so contracted under the PMO were deemed by the previous government as political appointees, whose contract expired with that of the regime which they served.
It was an arrangement that we could have done little to change.
While we were glad to see the end of the contracts of the many high-paying blatantly-political hiring’s under that system — we are also sensitive to the fact that some lower ranked people were unnecessarily exposed under this unfortunate arrangement.
Some of these people that had manned the outreach offices and others hired under the Government Information Service system, have unfortunately been affected. We have set about to correct those in the coming weeks where it is appropriate.
Those in the youth programme had their internship arrangements extended for just two months to end right after the general election.
We have been struggling, even without any allocation, to still extend some of those because they are needed in some programs.
In refusing to engage in political witch-hunts as a matter of policy and approach, we know we have frustrated a small number of our own supporters; and disappointed some of our political opponents.
This is not a political decision but an economic decision, as anything else will undermine worker confidence.
We have repeatedly said that our approach to building this nation is not to replace one band of workers with another — but to expand the economy so that more people will be employed. We have set about doing that — and the many of you watching tonight without a job, will find one in the weeks and months ahead.
We understand that it has been a long hard slog for you, and we are as eager as you to begin to turn things around.
Having assumed office on February 20, 2013, my first task after taking the oath, was to take stock of the fiscal and financial situation of our Country. To that end, I was briefed by senior officials of the Ministry of Finance on the same day.
The key findings of this Briefing included:
- An economy that had contracted in 2012 — the third time in the past four years. In fact the country has been in recession for years in spite of claims that it was all over.
- Unpaid Claims of EC$92 million (the highest it has ever been); significant and mounting arrears to external creditors including the Kuwait Fund, the World Bank and several others
- No parliamentary authority for Government’s Overdraft (this expired on January 17, 2013 even as Parliament remained closed)
- Monies for several loans and projects (such as the Caribbean Regional Infrastructure Project) held up because of the extended closure of Parliament.
In addition the past government had sold liquid assets that we could have used as leverage now.
Subsequently, I discovered several Cabinet decisions were purported to have been made just days before the elections including contracts for works and services with significant financial implications.
In what must be a first and a new low for this Country, several Cabinet decisions with unconfirmed minutes greeted me on my arrival in the Office of Prime Minister. This is highly improper. Clearly, none of these decisions are legal and binding on Government.
These actions confirm our worst suspicions, while in Opposition. The then Government, clearly in political freefell and facing certain defeat at the polls, was desperate and was prepared to do anything to cling to power.
That included a spending spree and a wanton disregard for all principles of democracy and good governance.
What is more, we are discovering more and more desperate actions every day.
For a Government which “branded” itself on transparency, accountability and good governance, these discoveries are hypocritical, shocking and revolting.
A senior member of the previous Administration recently remarked, and I quote “we may have been wiped out at the polls but we wiped out the Treasury.” End of quote. This comment is very insightful indeed. It confirms that the reckless actions to which I have just alluded were done deliberately and without care and concern for you, the people of this Country.
The closure of the parliament for six months has also affected us negatively.
More than two dozen bills, that would have helped the economic life of the country were not attended to on the altar of political expediency.
There were bills involving soft loans, restructuring the public service, and improving the efficiency of government.
Your Government, though disturbed by these actions — and in the case of the closure of parliament — lack of action — is not daunted. We are moving forward to take care of your business and deliver on our promises to you.
Having appointed a competent and cohesive Cabinet, our next task was to have Parliament, the home of our democracy opened. After eight long months, the doors of our Parliament were finally opened on March 27, 2013. Once again, our people will have their voices heard in our Nation’s Parliament.
Our democracy has been resurrected. God be praised.
In the meantime, your Government has negotiated with the Kuwait Fund to restore our relationship and settle our arrears. In this regard, I have signed a new agreement with the Kuwaiti Fund. Furthermore, the Government and Consolidated Contractors Company (CCC) have reached agreement on the way forward to ensure the Project can commence.
I am pleased to announce that Government will deliver on its promise to start the Agricultural Feeder Roads Project Phase II within 100 days of our assumption of office. This Project will commence in May 2013.
I should also indicate that the seven loans to the World Bank which were in arrears when we arrived in office have now been paid.
Our next major task is to present the National Budget. Under Constitution, a Budget must be passed each year. Under the Public Finance Management Act, this must be done no later than April 30.
If not, Government will have no authority to spend money on anything not even salaries for public officers or public assistance for needy citizens.
Notwithstanding, the limited time for preparation, the National Budget will be presented on Tuesday, April 16, 2013 at 10 am at the Grenada Trade Centre. As a consequence, Government expects that the 2013 Budget will be passed into law before the legal deadline of April 30, 2013.
The 2013 Budget will lay the foundation for building our New Economy and will empower your Government to begin to deliver on our promises to this Nation and especially our youth who voted for hope and opportunity.
The Budget will be growth-oriented. It will launch our economic revival after several years of economic decline. To facilitate this revival, it is imperative that Government cuts wasteful expenditure. We have commenced this cost cutting exercise. Each ministry and department has been asked to cut its non-personnel expenditure by 20%.
Brothers and sisters,
Government must reverse the unchecked growth of recurrent expenditure to find the fiscal space to invest in our people and the revival of our economy. The names of the members of the Waste Reduction Commission which will spearhead and monitor this effort will soon be made public.
Having reviewed the state of the public finances, it became immediately clear that Grenada could not continue to service her debt obligations on current terms.
Consequently, our Government moved swiftly and decisively to address this important issue. On March 08, 2013, we announced our Government’s intention to embark on a comprehensive and collaborative restructuring of the Public Debt.
Our decision is based on a clear understanding of the fiscal challenges facing our Nation as well as the suffering and cries of our people for jobs and opportunity.
The restructuring of the public debt is part of our strategy for building the New Economy. The New Economy involves putting our fiscal house in order, growing the economy, investing in our people and providing jobs and opportunity for all and especially our youth which account for more than 60% of our population.
Ultimately, the New Economy will help Grenada to meet her obligations to creditors in a timely and sustainable manner.
In preparing the National Budget, our Government has discovered that it is required to pay almost $38 million in salary increases and retro-active payments to public officers in 2013. This payment schedule is simply impossible. The previous Government which was having difficulty paying the current salaries of public servants must have known this when it approved these Agreements just before elections — further evidence of its desperation.
Our Government is very mindful that most public servants have not had any salary increases since 2008. We are committed to the increases which have been agreed but we must urgently discuss a revised timetable for these payments.
If our Economy does not begin to grow, Government will not be able to meet current obligations far more retroactive payments to public servants. As a consequence, it is in our collective interest to ensure our Economy returns to growth in the shortest time possible thereby improving Government’s revenues.
This week, I will be calling on the unions and public servants to work together with Government on this important issue.
Ultimately, Government will meet its obligations to public servants.
Every sector must appreciate the need for shared scarifies going into the immediate period.
The government has been very encouraged in our discussions with the social partners over the last few weeks.
There is a renewed sense of national commitment on everyone’s part. We have been very pleased with the tone and general willingness to work together with government from the trade union movement, leaders of NGOs, churches and other social movements. We are confident that as a nation we can come together and rebuild our homeland.
We are a people with a rich legacy of achievement and a proud history of national solidarity.
We have restored the democratic framework under which we can aspire, build and advance; and we are about to expand aspects of participatory democracy unheard of in a generation.
We have restored the value and worth of all local institutions — not just in words, but in deeds.
I am pleased to lead this progressive movement of change and restoration — of which we all can be proud.
The national leadership transition process is expected to be completed early next month.
In recent days I have had discussions with Governor General Sir Carlyle Glean who has expressed the desire to step down at the earliest convenient date.
The government has put the motion in train, with a view to having a new Head of State in place in the very early days of May.
We have identified a possible successor to Sir Carlyle, and we have been in touch with the office of Her Majesty the Queen, at whose pleasure the Governor General serves.
I am also pleased to announced that our next [representative of the] Head of State will be Cécile La Grenade.
With more women in our parliament than ever before, it is fitting that we will have our first female Governor General.
It is also fitting their her appointment will come at a time when we are paying tribute to the country’s first female governor dame Hilda Bynoe, who regrettably passed away this week.
The government has extended its condolence to the family of this proud daughter of our nation.
The appropriate national tribute will be paid to her in the coming days.
In spite of the hiccups of last year, you have shown that our democracy is solid and it can work to the benefit of the people.
Our nation has once again taken its rightful place among the community of nations in the Caribbean and we have begun to engage the world as we continue to restore our national image abroad.
This week I am down to give a lecture at the University of the West Indies Cave Hill Campus on the issue of science and technology, as Grenada once again takes up its leadership role on the issue.
The lecture is part of an annual series held in the name of late Barbados Prime Minister David Thompson.
While in Barbados for only one day, I will also meet with the President and the Vice President of the Caribbean Development Bank, where I will seek to also advance the CARICOM agenda.
Grenada hosts early next week the board of governors of the Eastern Caribbean Central Bank at which we will look at the fiscal health of the nations in the eastern Caribbean.
I am set to attend an OECS Heads of Government meeting in Antigua in early May, as well as a regional summit in the environment in the British Virgin islands hosted by Sir Richard Branson soon after that.
We are also preparing for the CARICOM Summit in Trinidad in early July at which I have also been invited to address the opening session.
This week we also observe 32 years of diplomatic relations with our Caribbean neighbour Cuba.
Only today I sent off a letter to the embassy here congratulating the local staff and expressing our nation’s appreciation for their country’s friendship and solidarity through the years, and through various governments.
Rest assured that you have a government that is working overtime on your behalf.
We shall restore this nation together — in the name of the rich legacy of our fore-fathers and in the interest of the next generation of great Grenadians.
I thank you very much. Good night.