Government travel spending sparked fresh opposition attacks yesterday after it was revealed that total spending of $11.8 million for the 2021-22 fiscal year exceeded budget allocations by $11.1 %.
Kwasi Thompson, a former minister of state for finance in the Minnis administration, questioned why those funds weren’t better spent on post-Hurricane Dorian reconstruction and other pressing taxpayer needs.
“While we are seeing an increase in taxes collected from Bahamians, we are not seeing a corresponding increase in aid and relief, especially for islands that are still recovering like Grand Bahama and Abaco,” the MP said. from eastern Grand Bahama. “However, we are seeing an increase in travel and living expenses that exceeds the budgeted amount by 11.1%.”
The details were in the report just released by the Department of Finance for the 2021-22 fiscal year and the fourth quarter, which found travel spending and government subsistence payments increased by more than two-thirds of one year to the next. year.
“Travel and living expenses increased by $4.7 million (66.7%) to $11.8 million and exceeded the budget target by 11.1%. Air transport, including domestic and international travel, and repatriation of the sick increased by $2.2 million and $0.8 million, respectively,” the report said.
The opposition Free National Movement (FNM) has frequently denounced what it seeks to portray as the Davis administration’s excessive travel spending, with large delegations traveling to the COP26 climate change conference, the Summit of Americas in Los Angeles and Commonwealth Heads of State. Government meeting in Rwanda, as well as Expo 2020 in Dubai.
The finance ministry figures will likely be exploited by the opposition to launch further attacks, although $11.8m is relatively small compared to the government’s spending of more than $3 billion for the year 2021-2022 . However, given the scale of the Bahamas’ budget crisis, every dollar counts, although it is unclear how much of the travel expenditure relates to the Minnis administration which was in office for the first two and a half months of exercise.
The Davis administration will also likely point out that the 2021-22 numbers face weak comparisons to the previous year, when there was little to no travel due to COVID lockdowns, border closures and d other restrictions. It will also counteract the need for the Bahamas to strengthen its presence on the world stage, particularly on climate change issues, and forge relationships to advance its interests that can only be accomplished by travel.
Meanwhile, the government’s spending on leases for its rents and offices rose nearly $22 million or 35% year-over-year for the 12 months to the end of June 2022 (per cent) to $633.4 million, compared to the same period of the previous year. This represented 93% of the annual budget,” the finance ministry said.
“Rental costs increased by $21.6 million (34.9%) to $83.5 million for 98.8% of the budget. This increase is mainly due to the increase in office rents ($11.5 million) and rental contracts relating to the National Insurance Fund ($8.9 million)… Special financial transactions, which include payment of arrears, increased by $36 million (28.5%) to $162.2 million and exceeded budget by 9.3%.
Mr Thompson sought to downplay the $700.7 million year-on-year increase in government revenue as ‘to be expected and unsurprising’, arguing the trend began when the Minnis administration was in power with Q1 2021-22 revenue exceeding $92. m above projections.
Dr Hubert Minnis, the former Prime Minister, also claimed that the initial revenue estimates in May 2021 were conservative due to continuing uncertainties regarding the COVID-19 pandemic. The increase in income was driven by the reopening of the economy and the end of shutdowns and other restrictions such as curfews, for which the Davis administration has sought to take credit.
Meanwhile, Mr Thompson tried to link fiscal performance to inflation and the cost of living crisis, arguing that “life is not getting any better for most Bahamians” due to high fuel prices. food, fuel and energy.
Despite a $124.7 million or 50.9% contraction in social assistance spending due to lower COVID-19 support, total government spending for 2021-22 still increased by $142 million or 4.9% to $3.015 billion from the prior year.
“Employee compensation increased by $24.4 million (3.5%) to $725.3 million and was 92.7% of the budget target. The firming was largely due to period-over-period increases in employee salaries ($18.8 million); special employment programs ($1.7 million); discretionary allocations ($1.8 million); summer jobs ($1.4 million),” the finance ministry said.
“This increase in spending is largely attributed to the resumption of promotions, staff reclassifications, payment of raises and other staff costs delayed over the past year due to budget constraints.”