University of the West Indies economist, Vaalmikki Arjoon, is recommending that Governments carry out infrastructural works all year rather than just around the local government or other election cycles.
August 14 is the date local government elections will be held in Trinidad and Arjoon, in an interview with the Business Guardian, spoke about economic and other developmental issues that surround local government elections.
“For decades, it is commonplace that at least few months before elections, whether it be local or general, both central and local government embark on a series of infrastructural works across the country such as road repairs and rehabilitation, improvements to water infrastructure and access, better sanitation, and irrigation, to name a few.
“However, these works ought to be spread throughout the year more often, instead of waiting for the last minute before elections. Indeed, when infrastructural problems are not addressed in a timely manner, such as road damage or poor irrigation, they tend to worsen, which exacerbates issues such as traffic and flooding.
“Leaving these problems to pile-up may also run the risk of poor-quality work, particularly when they are completed hastily before the elections,” said Arjoon.
He explained that poor quality work around election cycles usually costs taxpayers more in the long run.
“Of course, poor-quality work, such as road repairs, means that the road damage could re-appear in months, resulting in more monies having to be spent in the future to fix the same problem.
“The state and taxpayers are therefore at risk of not getting value for money, while those benefitting are the contractors repeatedly hired to redo these repairs. However, only aiming to fix existing infrastructure issues, such as road extension and patch-ups, to alleviate traffic is insufficient and is “kicking the can down the road.”
On Sunday night, the People’s National Movement (PNM) at their convention at NAPA, Port-of-Spain presented 141 candidates for 14 local government corporations in Trinidad.
Prime Minister Dr Keith Rowley spoke about the PNM’s achievements over the decades which include establishing First Citizens Bank, the Unit Trust Corporation (UTC), setting up Caroni (1975) Ltd and building highways.
On Monday night, Opposition Leader Kamla Persad-Bissessar confirmed the United National Congress (UNC) had formed a coalition with the National Transformation Alliance (NTA) and the Movement for National Development (MND). The coalition will field candidates in all 14 corporations
In terms of economic issues, Persad-Bissessar warned that the Government was not interested in local government reform but only in increasing taxes like property tax and the inheritance tax.
“Tax in your face, tax in your waist and tax all over the place, whether it is property tax, tyre tax, online tax, you name it,” she said.
Infrastructure
solutions
Arjoon gave practical examples of how the Government can carry out infrastructure works efficiently without burdening taxpayers.
“Governments ought to set more permanent solutions and aim higher. For instance, there is usually gridlock traffic in the Chaguanas area of the Sir Solomon Hochoy Highway on weekday evenings. Expanding the adjoining roads parallel to the highway can help to partially ease some of the traffic temporarily, but is really just pushing the bottleneck further down the road. A more permanent traffic solution is building an overpass in that vicinity. It will be capital intensive, but can save monies in the long-run, while significantly alleviating traffic woes, which in itself can substantially enhance productivity and attract more business activities in Chaguanas.”
Arjoon says inefficiency in Government projects is simply “mismanagement of state funds.”
“Further, delaying infrastructure projects to the eleventh hour before elections, whether they are repairs or new projects, results in higher project costs and spending. There can also be instances of mismanagement of state funds, typically through overspending and corruption when spending monies on these projects. Again, these can occur both at the state and municipal corporation levels.”
Private sector
investment
Arjoon also said apart from central government, local government corporations have a responsibility to create an environment that attracts and generates successful private sector investment, creates employment, productivity and lifts people out of poverty, through providing effective transport facilities and road infrastructure, reliable electricity, telecommunications, sanitation and developable urban land.
He added that businesses also prefer to invest in areas not prone to flooding and which have proper irrigation. All these, however, require the corporation to have reliable access to financing to fund local government projects. There are instances when they have to wait lengthy periods for the approved subventions allocated to them by the state. This inhibits them from being able to reliably meet their infrastructural obligations and provide other essential services.
He said the state, however, has indicated that property tax will help to alleviate the financing woes of the corporations as the revenues raised are supposed to be allotted to local government.
“This begs the question—will these monies form part of what is already being allotted to each corporation or will it be an additional allocation? For instance, assume the Chaguanas Borough Corporation (CBC) is allocated $73.4 million from the state. If property tax from this borough raises $20 million, then will the CBC receive a new sum of $93.4 million, or will the allocation remain at $73.4 million, inclusive of the $20 million from property tax? Further, whatever monies are allotted to corporations must have strict oversight and transparency standards to avoid corrupt practices, as this not only wastes funds but also inhibits local government projects from being completed.”
He concluded by saying that financing for local government corporations will become increasingly difficult as the Government has to respond to the needs of a growing urban population.
“They will have to look towards creating new financing opportunities, as proposed in this year’s Inter-American Development Bank (IADB) Mayor’s Forum, including creating a municipal fund, public-private partnerships, and sub-sovereign debt. This will however require decentralisation and to be incorporated in local government reform legislation.”
