KEVON FELMINE

Se­nior Re­porter

kevon.felmine@guardian.co.tt

Switch on the air con­di­tion­er, one econ­o­mist says, and every­one else helps pay for it. An­oth­er says fam­i­lies al­ready squeezed by food prices can­not af­ford to pay more.

The two econ­o­mists are weigh­ing in on the Elec­tric­i­ty Com­mis­sion’s (T&TEC) $10 bil­lion debt to the Na­tion­al Gas Com­pa­ny (NGC), which has be­come a po­lit­i­cal bat­tle­ground.

Dur­ing Wednes­day’s Stand­ing Fi­nance Com­mit­tee ex­am­i­na­tion of the Min­istry of Pub­lic Util­i­ties’ 2027 al­lo­ca­tions, Pub­lic Util­i­ties Min­is­ter Bar­ry Padarath stopped short of promis­ing cus­tomers they would be spared rate in­creas­es. He blamed the for­mer Peo­ple’s Na­tion­al Move­ment (PNM) ad­min­is­tra­tion for al­low­ing the debt to bal­loon. Op­po­si­tion MP Stu­art Young coun­tered that the Unit­ed Na­tion­al Con­gress (UNC) had been in of­fice for 19 months and must ad­dress the is­sue.

The two sides al­so clashed over the Reg­u­lat­ed In­dus­tries Com­mis­sion (RIC). Padarath said rec­om­men­da­tions made un­der the PNM would have raised rates by as much as 81 per cent in some cas­es. For­mer min­is­ter Mar­vin Gon­za­les re­ject­ed that claim. The UNC Gov­ern­ment had ear­li­er re­ject­ed the RIC’s pro­pos­als, say­ing a rate in­crease was not part of its elec­tion promise.

Econ­o­mist Dr Ronald Ramkissoon said the an­swer to whether now was the time to raise rates was a firm no.

“As much as high­er elec­tric­i­ty rates might be ap­pro­pri­ate, if we want to get over­all pric­ing right in this econ­o­my, this is not the time,” Ramkissoon said.

He said low- and mid­dle-in­come earn­ers were al­ready feel­ing the ef­fects of high­er food and oth­er prices. He al­so said the Gov­ern­ment had raised ex­pec­ta­tions dur­ing its elec­tion cam­paign that util­i­ty prices would not in­crease.

“If any­thing, an apol­o­gy to the pop­u­la­tion must pre­cede hon­est con­sul­ta­tion with stake­hold­ers,” he said.

Econ­o­mist and for­mer sen­a­tor Pro­fes­sor Patrick Wat­son, who once served on the RIC board, agreed that the tim­ing was poor but ar­gued that de­lay­ing ac­tion would make mat­ters worse.

“I don’t know that now is a good time in the sense that things are a lit­tle bit rough for peo­ple. But when I think about it, no time would be a good time,” Wat­son said.

He said T&TEC was heav­i­ly sub­sidised and that cus­tomers ul­ti­mate­ly paid for its debt. A util­i­ty starved of rev­enue, cou­pled with a gas com­pa­ny weak­ened by un­paid bills, could even­tu­al­ly put the elec­tric­i­ty sup­ply at risk or lead to a pun­ish­ing rate in­crease im­posed overnight, he said.

“And in the fi­nal analy­sis, we are the ones pay­ing for that. And the longer we take to deal with that debt, the more we are push­ing what we con­sume to­day, what we spend to­day on­to the backs of our grand­chil­dren.”

Wat­son stressed that any in­crease would have to be grad­ual.

“You can­not catch up on what we should re­al­ly pay T&TEC in one go. That can­not hap­pen.”

He said he had no ob­jec­tion to the bud­get’s elec­tric­i­ty sur­charge, which the Gov­ern­ment says af­fects few­er than ten per cent of cus­tomers—those us­ing 3,000 kilo­watt-hours or more. Wat­son said the sur­charge en­cour­aged con­ser­va­tion, com­par­ing cheap elec­tric­i­ty to sub­sidised petrol.

He said no in­crease would be pop­u­lar and that the Op­po­si­tion would score po­lit­i­cal points from one. Gov­ern­ments of all stripes, he added, avoid­ed rais­ing rates be­cause it was po­lit­i­cal­ly ex­pe­di­ent. De­spite his con­cerns about the cur­rent ad­min­is­tra­tion, he said he could not ar­gue against a rea­son­able in­crease.

Asked about al­ter­na­tives such as re­struc­tur­ing or writ­ing off the debt, Wat­son said the is­sue would re­quire a prop­er study.

Guardian Me­dia con­tact­ed the RIC for com­ment, but re­ceived no re­sponse up to news time.