Imbert delivers 10th Budget todayAnalyst: Don’t expect an election sweetener

Senior Multimedia Reporter

peter.christopher@guardian.co.tt

Today, Finance Minister Colm Imbert will deliver his tenth consecutive National Budget presentation at the Red House in Port-of-Spain.

Fiscal year 2025 will also be one that will include a general election, as August 2025 will mark the end of the five-year period since the People’s National Movement Government was returned to office.

Traditionally, the last budget before an election is often viewed as a possible “sweetheart” budget or a presentation loaded with incentives and promises for the public.

However, many stakeholders are not expecting today’s budget, which is scheduled to be delivered from 1.30 pm, to necessarily follow that pattern.

This is especially in light of Prime Minister Dr Keith Rowley’s claim that citizens would have to hold the fort for a few more years due to the uncertainty of the energy industry.

“The period between now and 2027 second quarter will be one of difficulty for the people of T&T, because the current levels at which we are producing, and the market situation, would cause us or should cause us to be responsible and, hold, hold the fort, with a very good view and good confidence that come 2027, we will be in a better position with this industry,” the PM said at Atlantic’s 25th anniversary and restructuring celebrations in Point Fortin on Friday.

In last year’s budget, Imbert forecast a total revenue of $54 billion and a total expenditure of $59.2 billion, for a deficit of $5.197 billion. He revised the budget to $61.5 billion in the mid-year review.

Political analyst Dr Winford James is among those who noted yesterday that it would be difficult for the Government to produce such a budget given various economic challenges.

“There’s an understanding of what an election budget is. If I were to summarise what an election budget is, I would say it’s a budget that does not add any other burdens on the population in addition to the burdens that are there,” said James.

“So we are coming into this new budget, and it’s an election year, and we expect the Government to want to be returned. But the Government, of course, has always said it’s strapped for cash. (The Government) references what’s happening in the oil and gas industry, and complains that there are things that the Government would like to do which should be funded by taxes, rather than simply the income from oil and gas.”

Against this backdrop of need for additional revenue from taxes amid a drop in returns from the energy sector, Dr James suggested that there could be some adjustments to utility bills, noting that fiscal 2024 had already introduced the idea of increasing the cost of electricity although it has not yet been implemented.

Last year, the Regulated Industries Commission (RIC) revealed proposed adjustments to the T&TEC electricity rates as well as a change in the billing system from bi-monthly to monthly.

Public Utilities Minister Marvin Gonzales has also spoken about introducing a metering system to address WASA’s billing system amid wastage complaints.

Both are yet to be implemented.

The Energy Chamber has also supported a call for the subsidy on electricity to be adjusted, with president Dr Thackwray Driver saying that the arrangement negatively impacts the potential returns in the energy sector.

Dr James also said the Government was likely to present additional clarifications concerning revenue collection from taxes, in particular with regard to the property tax. However, he said the Government would also have to balance introducing additional tax requirements against the reality that large pockets of the population have not seen increased incomes and as a result would struggle to cover increased payments.

“The Government finds itself underfunded in its income in order to meet certain kinds of developmental needs, meet those needs, so and they have, they have, I don’t want to use the word warned, but they have been preparing the population for an increase. My question is, where is the money coming from in the population? If you don’t increase people’s salary, or if you increase the salary minimally, how are they going to pay?” he asked, suggesting in that regard, some announcement would have to be made to address those concerns.

The political analyst said Imbert would also likely have to present incentives to encourage the manufacturing sector, particularly as the Government has faced challenges with fluctuating returns from the energy sector.

In the mid-year review, the Finance Minister confirmed that revenues were projected to be $3 billion less than expected for fiscal 2024. This was largely due to less than expected returns for the energy sector.

“Energy prices are not dictated by us. And I am not even so sure that our production is strong enough to enable us to benefit significantly from any increases in that sector. So those are things you expect the Minister of Finance to deal with,” James said.

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