Vice President Bharrat Jagdeo says that his government has and continues to actively ease the cost of living burden on its citizens and it is “burdensome” to see the Stabroek News (SN) every week publishing the laments of persons on their spending on basic expenses without pointing to its measures to cushion.
Jagdeo contended that the Cost of Living series done by the Stabroek News is a political ploy to discredit his government as there are a number of macroeconomic measures in place that provide for increased spending for persons on an everyday basis and cushioning costs through government’s subsidizing in a number of areas.
“I see Stabroek News going out with this thing they have… go to some elderly people and say, because they see it as a political issue, they say the cost of living has gone up and so what is your view on it.
“They don’t say what we [government] had to contend with and they don’t say that the cost of living is made up of many things,” the Vice President said last Thursday as he defended the PPP/C.
He said that persons complain about mostly market commodities and fuel yet they are unaware that government inputs huge sums to subsidize transport, fuel, water and other needs, to ensure that the very things they complain about are not the same high costs as in other regional countries.
His views expressed echoed much of what he has said since the Cost of Living series started.
“So cost of living is [number] one, your utility bills, transportation et cetera. Let’s talk about utility bills and how other countries have fared. You have had a massive increase in transportation costs in countries in this region and on [the] price of water and electricity supply. All of the countries have [had] this. How we dealt with it and what did it cost the treasury?”
The Vice President said that for fuel alone, government has to help the Guyana Power and Light Company with $34 on every barrel as that utility only budgeted for US$70 per barrel when the weighted average is some US$104.
“They budgeted US$70 when the weighted average is US$104. So when you calculate the volume of US$34 … if we don’t [subsidize] that, they have to increase their electricity prices. Immediately the government has to intercede. Who benefits from this? That is a subsidy to the business community and ordinary people. That is part of cost of living! We kept that constant at a cost of US$70. When the reporter from Stabroek News put their microphone and say ‘What do you think of this cost of living? They don’t ever say that,” he asserted.
“Are you aware that the government is putting US$70 million into subsidizing electricity so that it don’t move when it is skyrocketing in other countries? No, they don’t say that,” he added.
And when $80 billion in tax is spent on oil imports, he said that the spinoff is directly for the benefit for persons here. “Who benefits from this? The people of this country,” he expressed.
“Every Guyanese citizen who owns a car or runs a business would have had to pay $500 more per gallon diesel or gasoline. Just think of that every time you fill up your tank. Every Guyanese has benefited from this but you don’t hear about that,” he added while highlighting that many forget that transportation is a huge part of cost of living.
In the area of potable water and its delivery to citizens, he said that government also has heavy input in keeping those costs steady since 2020 to current, a period when the world underwent financial changes due to COVID-19, Russia’s war on Ukraine, and shipping blockages from pirates, notwithstanding global oil price increases.
“We drop the water rate by 5 per cent… although the cost has gone up enormously. Imagine if you have an increase in water rates … just for the supply of water, we have [seen] an increase in everything from alum and everything,” he noted.
“When you take these three elements alone look at the intervention alone. That never gets to the people. [Instead they are asked] Oh the price of bora went up so what do you think about cost of living? That is not how you measure. You have to do it comparatively and then you will see the dedicated plan that we have made, but it is nuanced and done politically to stir up people,” he said.
Jagdeo also took aim at a Stabroek News editorial which he said questioned President Irfaan Ali’s statement that disposable income here has increased under his leadership.
“One editorial in SN spoke about the President talking about disposable income… since we got into office through three agencies or three elements of the public sector, wages and salaries have gone up by $90 billion… And you are still questioning about how come the president is talking about disposable income and where it is? If you easily go to the budget, it is easily checked,” he said.
He also noted that since taking office the income tax threshold here has increased and a number of taxes reduced.
Last December, and speaking from a party perspective, Jagdeo had said that the government was successful in introducing measures which abated high living costs locally.
His response came following questions posed by a reporter from the Guyana Chronicle on how effective the government was in tackling the high costs of living locally, and his views on the series of articles carried by the Stabroek News on the lamentations of citizens on the subject.
Jagdeo made this statement as General Secretary of the People’s Progressive Party Civic (PPP) at Freedom House where he held his year-end press briefing. He also said that out of the $781.9 billion fiscal plan for 2023, $5 billion had been allocated towards additional cost of living measures.
The Vice-President noted that as part of the $5 billion cost-of-living allocation, $850 million was utilised for the acquisition of fertiliser to be distributed to the farmers. This, he explained, was to assist farmers in sustaining their crops and livestock in light of the hardships imposed by the high cost of living.
In addition, in an effort to contain the cost of fuel, zero excise tax was applied on fuel which will be maintained to absorb the impact of volatile fuel prices. He noted however, that this measure resulted in revenue losses of over $17 billion.
And according to Jagdeo, Guyana is in a better position as it relates to containing the cost of fuel when compared to countries in Europe and North America.
He recounted the reduction in freight charges, following an adjustment in costs based on the calculation of import taxes for 12 months at a cost of over $6 billion. He also referenced the government’s increase in Old Age Pension from $28,000 to $33,000 monthly, placing an additional $4.4 billion of disposable income in the hands of 73,000 pensioners.
“We then had direct interventions; we removed the taxes on a whole range of items, on data, on electricity, on water, on food items, a whole range of things – all of value-added taxes.”
He also spoke to the introduction of measures for persons who are building low-income houses, in particular, the steel and cement subsidies, pointing out that through the steel and cement subsidies, citizens building homes to the tune of $6 million and below are eligible to benefit from 80 lengths of ½ inch steel rods, 60 lengths of ⅜ inch steel rods, and one sling of cement. And those with estimates above $6 million and $25 million will benefit from two slings of cement.
