Gail Alexan­der

Se­nior Po­lit­i­cal Re­porter

The coun­try has a $4.42 bil­lion deficit “hole” for May and a pro­ject­ed $11 bil­lion deficit for this fis­cal year—but Prime Min­is­ter Kam­la Per­sad-Bisses­sar says her Gov­ern­ment will fix it in or­der to ho­n­our the par­ty promis­es to in­crease pub­lic ser­vants’ salaries.

Per­sad-Bisses­sar re­vealed the sit­u­a­tion yes­ter­day af­ter the new Gov­ern­ment’s first week in of­fice.

“It is a big fi­nan­cial hole ... they (PNM) didn’t even leave fumes ... Left us with over four bil­lion in a deficit sit­u­a­tion. So, we have to find the mon­ey and we’ll find it with the willpow­er and the brains. We have the poli­cies and the plans,” Per­sad-Bisses­sar added dur­ing a post-Cab­i­net me­dia brief­ing at the red House, Port-of-Spain

Apart from a com­bi­na­tion of plans to deal with the deficit, Per­sad-Bisses­sar al­so an­nounced the redi­rec­tion of cer­tain state-fund­ed se­cu­ri­ty to the an­ti-crime fight, cut­ting of state-fund­ed hous­ing - in­clud­ing for her team - and moves to cap the max­i­mum price on ve­hi­cles which Par­lia­men­tar­i­ans can pur­chase us­ing their tax breaks.

Per­sad-Bisses­sar spoke to the me­dia at 6 pm, 90 min­utes af­ter the sched­uled 4.30 pm start time of her brief­ing. This was af­ter the Unit­ed Na­tion­al Con­gress Gov­ern­ment’s first Cab­i­net meet­ing held at the Par­lia­ment.

Sur­round­ed by her team, Per­sad-Bisses­sar said brief­ing notes from the Fi­nance sec­re­tari­ats were re­ceived.

“What they found wasn’t sur­pris­ing. It’s a re­al­i­ty check to know where we are and (Fri­day) the Fi­nance Min­is­ter, Plan­ning Min­is­ter and oth­ers will hold a full press brief­ing on what is the re­al­i­ty of the day re­gard­ing the econ­o­my,” Per­sad-Bisses­sar said.

“But what they shared with us, the most im­por­tant part of it is the coun­try’s cash flow month to month. The cash flow state­ment gives an es­ti­mat­ed up­date of the Gov­ern­ment’s im­me­di­ate sta­tus by months, which is in­formed by mul­ti­ple Fi­nance Min­istry di­vi­sions.”

She said last month, to­tal cash flow was es­ti­mat­ed at $3.95B and to­tal cash out­flow was es­ti­mat­ed at $5.28B. “It’s telling us the out­flow is more than the in­flow, so we have a deficit. That was met in April from the Cen­tral Bank’s avail­able over­draft cash bal­ance,” she added.

“By the end of April, the avail­able over­draft cash bal­ance was $3.6 bil­lion, of which $2.7 bil­lion was car­ried for­ward to May 2025. It should be not­ed, how­ev­er, there was an out­stand­ing bal­ance of un­paid cheques in the sys­tem val­ued at $500 mil­lion which is al­so car­ried for­ward to May.”

Per­sad-Bisses­sar said cash in­flows for May from var­i­ous Gov­ern­ment rev­enue sources were es­ti­mat­ed at $2.38B. How­ev­er, it was es­ti­mat­ed the cash over­flow will be around $6.3B, “… re­sult­ing in a cash deficit po­si­tion of $3.92 bil­lion this month. Worse, if all the un­paid cheques in the sys­tem were pre­sent­ed for pay­ment, this would add a fur­ther $500 mil­lion to the deficit for the month of May,” Per­sad-Bisses­sar added.

“This will then take our to­tal deficit for this month to $4.42 bil­lion. There­fore, the Fi­nance Min­istry will need to find fund­ing.

“But we will fix it. This what we’d warned about in the elec­tion cam­paign - we said they had drained the Trea­sury. We weren’t caught by sur­prise so we were ready with the plans, poli­cies and pro­gramme to fix it. And fix it we will.”

She added, “As we are, cash flow, we have a deficit of $4.42 bil­lion. How are we go­ing to fill that fi­nan­cial hole? It’s a big hole.

“This is a del­i­cate sit­u­a­tion. It means our coun­ty was be­ing run month to month, lit­er­al­ly liv­ing on over­draft by the bank … they told us we were ‘run­ning on fumes’ in 2010/2015, ‘maxed out that over­draft’.

“Now is not about ‘max­ing out’ and ‘run­ning on fumes’, they don’t even have the fumes - they didn’t even leave fumes. So we have to find the mon­ey and we’ll find it with the willpow­er and the brains - we have very com­pe­tent peo­ple in Fi­nance.”

Per­sad-Bisses­sar said the deficit can be fund­ed via a com­bi­na­tion of plans. This in­cludes a pro­pos­al to draw down on the re­main­ing $2.7B avail­able in the Cen­tral Bank’s over­draft fa­cil­i­ty and re­fi­nance a min­i­mum of 60 per cent of Trea­sury bills due in May (al­low­ing $647.7m to ad­dress part of the deficit), ex­am­in­ing a Her­itage and Sta­bil­i­sa­tion Fund draw­down for the rest of the fis­cal year of $1.76B and ad­di­tion­al bor­row­ing of $1B.

She said the Gov­ern­ment had to do it as, “this is the way we’ve de­ter­mined to help work­ers—pay salaries and pen­sions, do debt ser­vic­ing and ex­pen­di­ture on oth­er goods and ser­vices, trans­fer and sub­si­dies.”

Per­sad-Bisses­sar said the sit­u­a­tion al­so means that at the end of this fis­cal year, the deficit will be about $11b. “We said it in the last Bud­get de­bate while the min­is­ter was giv­ing us some cock and bull sto­ry about it would on­ly be this and that amount!”

Every min­istry ‘maxed’ out

‘Per­sad-Bisses­sar said the most re­cent tax col­lec­tion da­ta for fis­cal 2025 is up to March 2025. The da­ta shows that from Oc­to­ber 2024 to March 2025, to­tal fis­cal col­lec­tions were $17.563 bil­lion.

“The Fi­nance Min­istry’s per­ma­nent sec­re­tary has been asked to pro­vide a re­vised pro­jec­tion of rev­enues in the short and medi­um term. Giv­en the high lev­els of deficit and debt, this is like­ly to ad­verse­ly af­fect the rat­ings from the Cred­it Rat­ing Agen­cies,” she said.

She said the elec­tion co­in­cid­ed with the mid-year re­view of the 2025 Bud­get and her Gov­ern­ment had to as­sess the state of the econ­o­my, or how it moves for­ward with poli­cies. Per­sad-Bisses­sar said it was im­per­a­tive to go to Par­lia­ment as soon as pos­si­ble for a re­view re­gard­ing fund­ing. Par­lia­ment is ex­pect­ed to open lat­er this month.

She said all min­is­ters met with their de­part­ments on the sta­tus of rev­enue and ex­pen­di­ture in each min­istry and the deficit. She said she was told that in every min­istry, “they maxed out the ex­pen­di­ture” and (mon­ey) votes al­lo­cat­ed to min­istry was ze­ro.

She not­ed $69.6m was to be paid on le­gal fees and Gov­ern­ment would soon as­cer­tain who the “eat ah food” lawyers are.

In the Cul­ture Min­istry, she claimed cell phones were used for cam­paign­ing - an is­sue which would be ex­am­ined. There were al­so min­istries where peo­ple were hired at high salaries for the elec­tion month.

State-fund­ed se­cu­ri­ty, house to be cut

Per­sad-Bisses­sar said she had in­struct­ed the Home­land Se­cu­ri­ty Min­is­ter to pro­vide a list of all per­sons ben­e­fit­ing from state-fund­ed se­cu­ri­ty, both po­lice and pri­vate.

“We plan to redi­rect most of these re­sources to­wards the fight against crime, so many of these un­nec­es­sary se­cu­ri­ty de­tails will be cut. I’m told some peo­ple have ar­moured cars...some peo­ple just have this rid­ing around like big je­fes not be­cause there’s a risk,” she said.

“I’ve al­so re­quest­ed a list­ing of gov­ern­ment of­fi­cials be­ing sup­plied with state-fund­ed hous­ing to see where we can cut some costs. ... The coun­try isn’t that big; they can dri­ve to work from their homes. Min­is­ters have hous­ing al­lowance paid for by the state - if you want house in town pay the rent!” (See page 7)

“I’ve al­so di­rect­ed that an as­sess­ment be done to cap the max­i­mum price on ve­hi­cles that par­lia­men­tar­i­ans can pur­chase us­ing their tax breaks,” she added.

She said Cab­i­net had al­so agreed to re­view the Chil­dren’s Life Fund with a view to ex­pand­ing its scope.

PM con­grat­u­lates new pope

Prime Min­is­ter Kam­la Per­sad-Bisses­sar has con­grat­u­lat­ed new Pope Leo XIV (Robert Provost).

”As we pray for his suc­cess and en­rich­ing stew­ard­ship of the Ro­man Catholic church, we al­so con­grat­u­late him on a very his­toric oc­ca­sion of be­com­ing the first Pope of Amer­i­can ori­gin. The Ro­man Catholic Church has al­ways played a piv­otal role in our com­mu­ni­ty from hu­man de­vel­op­ment to spir­i­tu­al en­light­en­ment. Giv­en the many chal­lenges the world is fac­ing, I have con­fi­dence that based on Pope Leo’s ca­reer of kind­ness, love, hu­mil­i­ty and ded­i­ca­tion to­wards hu­man­i­ty, he will play an in­spi­ra­tional role.”