No need to itemise proposed oil money spending – Jagdeo; NRF member calls mechanism a “waste of time”

Last Updated on Friday, 6 December 2024, 20:07 by Writer

A member of the Natural Resources Fund (NRF) Investment Committee believes that government should list how it intends to spend oil revenues before the money can be transferred to the consolidated fund, but Vice President Bharrat Jagdeo on Thursday resisted the idea and said accountability rests with the National Assembly.

“What sense does it make?…So next year, should we start saying oil money should only go to infrastructure and nothing else?” he queried. He said government has “remained true to its manifesto” through spending on a wide array of priorities.

Dr Terrence Campbell, the opposition-nominated member of the NRF’s Investment Committee, said he has voiced his dissatisfaction in the committee with the less-than-transparent process by which monies were being drawn down from the fund for government spending on projects and programmes. “They’re making withdrawals without specifying what the withdrawals are to be used for so they just take the money and they put into the Consolidated Fund and then they use it as they see fit,” he told Demerara Waves Online News.

He said he would be donating his monthly stipend of GY$100,000 to the Beacon Foundation to assist with care of prostate cancer patients because “I do not believe I deserve a single cent”. He said he would, however, remain on the committee to keep an eye out on the functioning of the work of the NRF for Guyanese.

Referring to the NRF Act that states that the revenues are to be used for national development priorities or special projects following a natural disaster, he said due to the absence of a list of proposed spending, the Public Accountability and Oversight Committee has no work to do. “If the requests do not specify how the funds are to be used , it makes nonsense of the Public Accountability and Oversight Committee because there is nothing for them to follow up on,” he said. Dr Campbell also deemed the Investment Committee of which he is a member a “waste of time” because only if the NRF Act exceeds US$5 billion, the monies would be invested in safe investments such as bank deposits and treasury bills. “Based on the current rate of depletion of the Fund, the Investment Committee really has no work to do and so the whole apparatus of fund management basically is a waste of time, as currently structured,” he said. For Dr Campbell, he questioned whether the cash grant, expected to benefit an estimated 600,000 Guyanese is a “national development priority or is that more of a political spend.”

But Mr Jagdeo on Thursday repeatedly said that revenues from all sources are interchangeable and that there was no need to separate use of oil revenues from other earnings such as taxes. The Vice President also declined to say what percentage of the GY$60 billion cash grant for GY$100,000 per adult came from oil revenues. “If I say that all of it is coming from oil resources, what does that mean? Would it change the fact that the government of Guyana, in a macroeconomic framework is giving GY$60 billion to the citizens of the country so what does it mean to the people of this country whether they get it from oil money or non-oil revenue?” he asked. Mr Jagdeo said they are getting the payout from a government that is transforming the country’s infrastructure and spending on health, education and other priorities while ensuring Guyana’s debt stock is lower than 40 years ago.

The Vice President reiterated that oil revenues make up less than 30 percent of Guyana’s GY$1.145 billion (US$5.5 billion) budget for 2024 and nearly 40 percent is revenue from non-oil sources. He questioned whether government should also divide non-oil revenues among public projects and programmes. “How could we balkanize revenue coming into the budget? It becomes a very difficult thing to do so where the transparency is done is that every cent spent from oil money, non-oil revenue and from borrowing has to be appropriated by the National Assembly through a budgetary appropriations process, whether it is the original budget or through supplementary budget,” he said.

He said the itemization is contained in the budget law for parliamentary approval.

Total revenue for this year was projected at GY$947 billion (US$4.5 billion).

Instead, Mr Jagdeo focussed on the listing of each oil revenue transaction, in contrast to any other oil producing nation. He said concerns about transparency were being fuelled by the opposition. “They are shocked that we can actually change the way it’s changing and still find the resources to make this massive payout to people, every citizen without increasing our foreign borrowings significantly,” he said.

Meanwhile, he said the GY$60 billion cash grant would not trigger inflation, adding that it was not a recurrent annual expenditure but a “short term” intervention to assist Guyanese.