THE HEADLINE of today’s commentary, or derivations of it, has been used for years by those opposing the party in power to suggest that the current administration is corrupt or is mismanaging the economy.
In the seven years since the election of the People’s National Movement (PNM) on September 7, 2015, Opposition Leader, Kamla Persad-Bissessar and her colleagues, have asked the question of the Government on several occasions at press conferences or political meetings.
In the five years and four months before that—that is from May 2010 to September 2015, which was the period of stewardship of the People’s Partnership led by Mrs Persad-Bissessar—Dr Rowley as the then Opposition Leader asked the question of the administration a number of times.
Interestingly, the question is now routinely asked in non-political situations.
According to a Google search using the search words “Where the money gone Trinidad,” the Trinidad Guardian used the headline, ‘Harry, where the money gone,’ on July 5, 2011 above an article in which three shareholders of the Hindu Credit Union were enquiring what had become of their funds at the Commission of Enquiry into the collapse of CL Financial and HCU.
And the headline ‘HDC tenants to Camille: Where the money gone?’ was used in the Trinidad Express as recently as July 30, 2022, to reflect enquiries by tenants of homes built by the Housing Development Corporation about the use of their payment of maintenance fees.
While not discounting the leakage of public money through corruption and mismanagement, all of the politicians who ask the question, ‘Where the money gone?’ of their opponents, KNOW very well where public money has been, and is being, spent.
The politicians KNOW that of every dollar spent by the Government in T&T, more than $0.50 is spent in a category of expenditure called transfers and subsidies (T&S).
By way of example, in the period from October 2015 to August 2022, the total expenditure of the current administration, led by Prime Minister Dr Keith Rowley, was $368.34 billion (See table 1). That information was sourced from the 2021 Review of the Economy appendix 22 and the presentation of one of the permanent secretaries in the Ministry of Finance, Suzette Taylor Lee-Chee at the September 2, 2022 Spotlight on the Economy 2022. The 2022 expenditure number is a provisional estimate.
The total amount of money spent on transfers and subsidies in the seven fiscal years from 2016 to 2022 is $188.41 billion (See table 2). That means 51.15 per cent of the $368.34 billion spent by the current administration in the last seven years has been allocated to transfers and subsidies.
Very helpfully, Mrs Tayloy Lee-Chee provides a breakdown of the Ministry of Finance’s expectation of how the $29.85 billion allocated to transfers and subsidies will be spent in the current 2022 fiscal year.
Of the $29.85 billion, it is estimated that $10.52 billion will go directly to households, $3.70 billion will go to State enterprises, $5.89 billion to statutory boards and similar bodies and $7.74 billion to other transfers.
Therefore, if the total expenditure in 2022 closes at $55.18 billion, and the direct transfers to households is $10.52 billion, that means households will receive about 19 per cent of the total expenditure of the Government in 2022.
So, if ever the issue of ‘Where the money gone’ comes up in a discussion, the correct answer is more than half goes in transfers and subsidies and 19 per cent is transferred directly to households. Monies allocated directly to households vary very little as a percentage of total expenditure. And the pattern of expenditure on transfers and subsidies has varied very little between the Government and the Opposition in the last 20 years.
But there are other indirect ways in which households in T&T benefit from the Government’s expenditure.
In his presentation at the Spotlight on the Economy, Finance Minister Imbert estimated that the Government will spend $2.64 billion subsidising the cost of fuel in the current 2022 fiscal year.
Some of that $2.64 billion ensures that households in T&T do NOT pay the full economic cost of fuel, during a fiscal year in which the global price of crude oil, from which T&T’s fuels are manufactured, topped US$120 a barrel.
Some of the $2.64 billion fuel subsidy also ensures that taxies, maxi taxies and trucks do not pay the full cost of fuel that is used to transport people and products throughout the country.
Mr Imbert also disclosed that the Government spends over $2 billion a year subsidising the Water and Sewerage Authority and another $700 million subsidising the Trinidad and Tobago Electricity Commission. Of that $2.7 billion spent subsidising the production of water and electricity, I suspect that a significant percentage benefits households.
If only half of the fuel subsidy and the subsidies on electricity and water are attributable to households, that would add another $2.67 billion in indirect subsidies provided by the Government to households.
It would be very interesting if the Ministry of Finance were to provide a comprehensive estimate in the 2023 budget of the ways in which Government expenditure directly and indirectly benefits households in this country.
If the ministry were to do that, there would be absolutely no doubt about ‘Where the money gone.’
Fiscal year Total expenditure
Total $$368,343.2 million
Fiscal year T&S
Total $188,417.6 million
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