Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697797249472.pdf (Guyana)
CO-OPERATIVE Of GUYANA REPUBLIC GUYANA THIRD PARLIAMENT OF GUYANA UNDER THE CONSTITUTION OF GUYANA FIRST SESSION 1973 BUDGET SPEECH the Hon.

F; E. Hope, M.P.

Minister of Finance 10th December, 1973 BUDGET SPEECH - 1974 INTRODUCTION Mr. Speaker, it is time once again, to present and fiscal proposals of the Government, and th:!

People of GuyaDa the to this National Assembly, expenditure the next fiscal year (1974).
In the course of the presentation review the public finances of ihe country over the past the economic and monetary trende both national and international an attempt would be made to flows.
-which impinged on those financial year, and for Mr. Speaker, the Government is deeply conscious of the economy to the development which has naturally devolved success of its over-whelming of the great responsibility upon it, as a consequence at the polls in July 16th of this year, to give positive direction In this Budget therefore a high level of capital investment diversify producti job opportunities would borrow to finance its capital programmes, but it proposes contribution of ·our development on as quickly as and create for the unemployed.
The Government to increase and possible, of the Guyanese efforts.

also to take firm steps to increase is proposed, essentially people to the financing of Guyana.

the Since the last Budget was 1972 the Government presented to this House has issued a draft That for tte period 1972-1976. identifies full employment in December, development programme programme the major objectives efforts; plan period Guyanese must be able to feed, clothe and house themselves.
of the Government's and sets as a target that by the end of the by 1976 as one of development Essentially Sir, the programme pre-supposes discipline leading eventually of eelf-suf a t remendous level of self-reliance measure ficiency in the domestic economy.
to a significant of development and 3 about development that form part of this Budget rest largely on the assumption that the to endure a period of austerity in and even social services, programme in may be implemen­ economic for self-sustained The fiscal proposals presentation people of this country a.re serious and are prepared terms of consumption order that the development ted and the foundations growth established.
proposals Private a,1-1 unionised measure of sacrifice self-restrnint enable jobs to be created endorse Sectors presume workers Substantially, too, the that trade unions in both Public the proposition that have a duty to accept a certain some and �re prepared to exercise in terms of pay demands, in order to for the unemployed.
SIGNIFICANT WORLD ECONOMIC TRENDS: But Mr. Speaker, before pursuing this line of the more very describe important thought further, I should perhaps briefly which we have had to live over the post year.

These trends have exerted, and will continue substantial on our domestic experience, financial influence and inevitably to exert, economic on the economic policies we pursue.

and world economic trends with One of the most disturbine economic problell.B of the world and accelerating inflation.
of Europe, that has a ffected most of the economies has been psrsistent countries developed have with few exceptions price rises that, in some of these countries, have averaged over twelve per cent per annum.

Most of the inflation has been the result of the pursuit of full employment the sharp rise in disposal incomes, goods, - a demand Mr. Speaker, that in many cases has outstripped policies, and a rapidly experienced immediately available productive capacity.
and North Alllericn inflationary growing demand for consumption The 4 unable so far to isolate from the effects of this inflation in the The developiQ/J countries of the World - and Guyana is one of theee - have been themselves developed countries, which their own internal prosperity and economic policies generated.

This is so because like Guyana, the economies developiil6' nationa are open.

There is a high propensity to import.


We have seen the i nflationary trend in Guyana over the past twelve months in the form of h i gher food prices, and the increased landed coat of raw materials, textilee, only a few.

spare parts and .machinery to name of moat of the These inflationary trends have been accompanied by and in many instances, they have been the cause of, continued monetary inatabili ty.
The major currencies of the world are still subject to disturbiil6' fluctuations in their exchange Fund continues to grapple with the task oi devising a reformed system thn t would both work and last.

ratee as the International Monetary In the framework of these trends - inflation and - and largely in Lendill8 to mediun term money have soared International-Monatary instability reeponse to them, interest rates in the money markets of the world have shot-up to record levels.
rates for short and heights in excess of 13% per annun, while the long term money market, at least for the Governments of vanished, small developing countries, has practically as the countries vi.th available capital try to combat inflation by pushing upwards the context of exchange rate the uncertain capital loss is too great to make long term lending a viable proposition for the ti.me being, at even the prevailing high rates of interest.
Borrower countries must therefore content themselves with borrowing on terms which include maturities that range from five to nine or ten years.

the cost of money.

In risk of 5 The significance of these developments for multilateral flows through Interna­ like the World Bonk, the International (IDA), and Regional Development financial countries is limited and period of monetary Association responsive in the present from developed to nppreciate.
External borrowing risk business; the exchange and like Guyana that mu.st borrow abroad, to the growing nsed is now capital.

The emphasis countries purchase their ca.pi tal goods from external sources, is not difficult has become an expensive of borrowing uncertainty is sobering.

But Mr. Speaker, it is a well known fact that the flow of bilateral assistance is not necessarily for developmental tending towards tional Agencies Development Banks.
It is only through the IDA -the soft window of the World Baak: that borrowing possible.

of near USS300 is lished by IDA for from its low interest In fact most of the resources of IDA now go to the twenty five least developed defined of a per capita income of USSlOO or less.

Guyana is therefore are not replenished rapidly enough, countriss, available tion.
Certainly good reason to anticipate increased for Guyana from this is expected Guyana like a number of developing is unable to secure enough of the the World Bank, very little if any of to take the form of credits hovering just above identifying countries not one of these.

Since the f unds of the IDA in the coming year although there is through that international of the developing Guyana however, countries, the limit estab­ credit.s.
by the Aid providing countries financial support on soft terms is really which has a per capita income from the IDA.

soft funds in terms that may benefit financial institu­ We must, to an increasing our devslopment money to finance however, borrowing Commercial when compared borrowing advantage with bilateral untied, is entirely one very significant There ie, in this kind of borrowing.

and therefore extent, programme.

rely on harder 6 can be so spent as to marl.mise the purchasing power of each dollar.
While as I have pointed out, Mr. Speaker, the from the developing countries.

countries, s exported open eoonoay an increase of some £34 during World market prices for by developing prices of imports like Guyana., have been increasing sharply, the market has been rather strong for a number of primary commoditie In so far as Guyana is concerned sugar reached the level of £110 or GS573: per ton during November, representing the year.

The negotiated per ton compared of internationally US$100 per ounce.
At the same time metal grade Bauxite prices were showing some recovery, albeit slow, after the depressing of Rice country was able to secure fairly significant increases prices were pegged at G$318� vith GS243 two years ago.

The price traded gold was seldom.

lower than on the World Market was also high, and this price levels of 1971 and 1972.

The prioe in the Caribbean.


from the Markets price Against these increases in primary commodity prices this country had to cope with phenomenal price rises for wheat, corn, machine parts anf fuel, dairy products, factured and semi-manufactured and in fact practically all items of manu­ goods.

On balance for most developing import prices in general Guyana, steadily as to out-strip the falling terms 1973 in common with other developing of trade which Guyana experienced countries.
rose so sharply export prices; for aad so the result was in countries, as Added to price inflation, no doubt giving rise to it in certain instances, in certain staple food items which faced ths developing world.

Shortages in the supply of grain such as wheat, were the �erious shortages 7 of starvation corn and rice have been particularly significant.

The world now facee a real possibility unless the supply of these commodities could be drasti­ For Guyana, Mr. Speaker, there cally improved.
is a golden opportunity.

There is an assured market at remunerative meat that we can produce.

suggest that demand for these commodities strong over the next two years at least, as grapples to build-up stocks that the past two years.
prices, for o.11 the rice, sugar, corn and seem to All the indications vi th a growing demand for food, and the need would remain the world were seriously depleted over These trends Mr. Speaker, hold important in food by for exports sxchnnge, to conclude the economic strategy we adopt.
It is clear of self-sufficiency in the international markets must to many while offering employment would earn the country substantial that increasing the of grains like rice and corn to create guidelines f or us in Guyana and must dictate or at least influence that food shortages make our policy objectiVe the end of the plan period most critical and far-sighted; it is not d ifficult production surpluses foreign persons.
It is not difficult to conclude of the high cost of foreign borrowing it is of utmost domestic importance savings for the al�o be self-evident from the inflation of the industrialised must put goods that must be imported.

really to develop our economy, expanded and diversified, requirements, export opportunities brake on O,.J.I' desire to consume In summary if we are must be production but also to take full advantage ttat are clearly should rely more on of development that Guyanese financing works.
It must ourselves of the present.

not only to meet domestic that if we are to protect a substantial that in view countries, we Indeed our projected capital outlays for 1974 have been given t his thrust.

Most of the planned capital 8 to be directly expenditures are designed They have been made in sectors that present the best opportunity domestic and produced, strong for some time yet.
to be to be are strong at present and will continue for expanded foreign -for the commodities output, because the market - productive.

Further Mr. Speaker, I think it should be known efforts is linked to in our development y.
Because instability that success monetary stabilit and fundamental Foreign Exchanges, prohibitively and put a brake on economic have been ereoted in many countries against the free flow of funds; for instance, Sterling funds can no longer flow of the deep uncertainties which characterise high as to make Illfiny projects the cost of money and credit is so the unfensible growth; substantial barriers against of United Kingdom Exchnnge value of Sterling Area Countries.
The freely into Guyunn because Control foreign exchange earnings for our exports from dey to dayJ in fact, the Bauxite experienced when the USS strengthened capital Cost of a project could rise significantly because foreign exchange.

movements in of these same unpredictable losses in terms of Guyana currency in this year; and the earlier certain Industry could vary But monetary instability is none of our making.
As a small country we feel the full effect, very little to change the situation, except make our views heard in the Internation while the instability environment the exchange development in which we could adopt, or even determine, rate policy that would best fit our circumstances.

persists, we do not have the best al Monetary Fund.

In fact, but can do What is the prospect for a return to monetary stability?
9 WORLD MONETARY REFORM: Last year when I presented the budget to this House, the International Monetary situation Honourable was extremely unsettled.

The floating, and other major countries including high interest rates in the case of weaker currencies, and even negative interest rates, in the case of the stronger currencies, reserves and the stnbili ty of their currency.
pound ·sterling to protect their taking steps, was By early 1973 the system had collapsed ngnin after the measure of stability Smithsonian devaluntion of exchange re-alignment.

There was then of the US dollar and a further re-alig!

'lment rates in February.

introduced at the time of the n further And even this did not help the dollr.ir.

Less than US dollnr was yet two w eeks later the twice-devalued aeain under severe pres�ure from speculutive 1973, it was cle<1r thht tbP.
Brettou Woods By mid-March, system of ntable exchange rates, anchored to f'.Old, hnd become too vulnerable to sLtch speculntive It wus then virtually abandoned (pendirie and all the mnjor reserve curre11cies takine with them in their snake-like currendfos Umt were tied to them� attack:_,.

reconstruction); re:..ior·ted Lo a float movements the other ultacks.

lihr,t was wronc with t.hf:' old BrAtton Woods system?

Times had chaoged.
Times had chaoged.

Moreover, recent eve:;tu in my view estal1li:1h clearly that one of ils mnjor f11ul t.s WM.\ that it rested too heavily on one currency - the U3 dollar.

In recent years this currellcy liquidit y on <m uncontrollAd related to the defjcits on the TT!l bnlnuce of i,llyment.s, uud not to thA world need fa, such liquidity.

The wodd economy hus been flooded w:i th liquidity and pushed into nn inflntionary �tnd indhiciplined basit< hau provide,i spiral.
inLerrmUounl 10 As I said at Nairobi, when I spoke on behalf we have since made towards In particular countries Caribbean of the International at the 1973 Monetary Fund, the reform of the system the consensus on any must no longer rest so heavily national currency, but of all the independent Annual Meeting progress is very heartening.
the system particular alised on the basis of the SDR - a world reserve currency, needs, so as to avoid the extremes and deflation be relnted to global of world inflation -was a long step forward the issue of which could that should be internation­ • I also urged then, that the allocation of SDRs with the countries, reversal to the developing of the present flow real resources should be linked with the transfer of countries - from the developed of real a desirable resources from the developing to the developed which the holding of reserve currencies entails.
The few who oppose the l inking of SDR allocations transfer of real r esources from the developed to the developing countries presumably do so because of their fears about the possibility of inflationary over-issues • But.

as I sai,i at the Annu1ll Li no more reason for objectine to this link than there i:3 for· objecting to the channelling of real resources, through the use of a nationnl banking syatem, into economk development.
If the fear of abuse of a process that is useful to hu.mani ty were allowed to prevail in respect of this use of national money, we should still be in the barter age, eschewing of mocey for too good of the commuai over-doine it.

ty for fear of the issue Meeting in Nairobi, there We must hasten the implemanto.tion of the proposals a system of stahle but adjustable for re-estublishine rates of exchanee between countries.
them to provide rates tem di;!, Thi:=t rigidity We cannot expect as rigidly stable as the old sys­ was part of the reason for its II the currencies for the prompt adjUBtment of the par collapse.

The new system rm.mt include adequate arrangements values of countries, place an obligation monetary order to effect settlement of deficits •Nith reserve assets - in cash, so to speak, and not in o f both deficit nnd surplus from time to time, and on all participants as may be necessary in the new I.0.U's.
Now how have we fared in this world of floating our fixed relationships with sterling-related curren­ ••• Thus, about two-fifths Caribbean ober than of our external rates?

We have maintained with the £ Ster line and cies (e.g.

of the Commonwealth Jamaica) trade (more on the impor-t and less on the export side) has been enabled, rates, to enjoy stability.
However, since sterling has been generally deprecin.ting the other European currencies trade is relatively a large purt of our externn.1 there have been quite l!.lrge movements of the Guyunu dollar in relation to these currencies.
even in a world o f floatine trade is conducted), (in which our external with respect to both small) 11ml the US dollar (in which Since thR enrl of 1971 the Guye.nu dollnr hus in te:a,is o� the US dollar by about 10% and depreciated in terms of E:uropean currencies average by about 20%, (largely through revaluation but has retained her stable p11ri t y with sterling.
(other than sterline) ), on RELATIONS WITH THE EEC: Now, Sir, I wolild like to turn very b riefly tr, in our interrmtiom1l known the 8uropean 8conomic anober ar'3a of uncertainty relations.

Co:mnunit,1 is now an associ.ci.tion rather than six, since thP.

entry of Britain, Denm:1rk and E:ire in January 197.5 into that Community.
As I A::, is senerally of nine European Nations, trading 12 entry into the necessitated a clear European Community out last year Great Britain's pointed expanded definition between Guyana, and the EEC.
Negotintions are now in train • But vital to the Caribbean the mnintenan ce of a guaranteed market for such of our com.modi ties as Sugar, Bananas, Ci true and Rum, on terms of the relationship alth Caribbean that would subsist the Commonwe Community are such issues as countries including quantity in the British market prior to and price) no less favourable than (including the West Indies enjoyed Britain's entry into the EEC; favoured Caribbean Common Market exports tured and manufactured goods, into Europe without reverse preferences in favour of the European and participution in the European purticularly for the less developed countries in Caribbean Region.
including semi-manufac­ Development entry of Community; Fund, the It is expected that in the negotiations which are to take place during the coming year the �cheduled Caribbean, working together our colleagues from the independent would be able to forge n link with Europe that is favourable to the continued and accelerated our several our individual national sovereignty.
economies; but that in no way compromis and in collaboration growth of States of Africa, with es THE PERFORMANCE OF THE ECONOMY: Mr. Speaker, I now turn to the domestic scene and would attempt to review the performance economy background World in general.

of the Guyana arly against the of the economic trends which affected during the pust year, purticul the In 1973 for a second consecutive year, the economy failed to record the projected output lagged behind reasonnble expectations.
The Gross rate o f growth as domestic 13 estimated to have Domestic Product is preliminarily by between 8% and 9% at current increased over 1972.

Since domestic prices and the average price of exports it is not expected that growth in real terms was sienificant; have fallen slightly.
have on the average risen in fact the real per caput income may even by almost as much, factor cost Inflationary pressures were more intense y in the latter half of the year, being in steeply rising prices, particularly manufactured for as a result of inclement particularl 'reflected food items nnd imported developed partly floods in failure producing countries.

of agric-.il goods.
of agric-.il goods.

Shortages weather and of a the previous year, but also because tural output which plagued many other Key exports fell in volume terms at a time when rose in quantity, which had already developed were exports was strong and served to aggravate pressures of sharply rising import prices.

Despite the in wages and salaries in lllllllY sectors prices for most of our primary commodity quite high; at the same time imports but even more in terms of prices.
Domestic demand for goods and services the inflationary because improvement economy including the Public Service, to have declinsd appeared Nation.al Product, compared This was due in the main to the substantial public expenditure Mr. SpeD.ker, that the saving rate would need to rise sharply of capital -to about 16% of Gross over revenues.

the snvings rate outlays.

It is clear overrun of of the again i f we are to sustain an expanded programme with 2� three years earlier.
The failure of output in the main productive sectors growth performance.

of the economy wae central to the disappointing 14 It was also the ma.in contributory rise to tbs strains which developed in the Central GOT­ ernment finances and on our balanoe of payaente.
factor that gave Sugar production -at 270,000 tons was 14% less but than in 1972J rice output fell below expectations much bettsr than in the previous at 110,000 tons was year; while bauxite output - particularly dried bam:ite and aluaioa -declined below last year's levels.

These three sectors even now, the growth points in the economy.

Ona of the more unfortunate aspects of this :position observed demand was strong, and prices were extremely encouraging.
-3u8ar, Rice and Bauxite for both sugar and rice, the external -are really earlier, is that as I Further as a result of strong encouragement by the Government, acreage under sugar-cane and rice had been expanded.

This was particularly true of rice where the very substan­ in acreage under cultivation was increase t ial.

and Harvest time saw vast to the normal reaping of the padi crop.

In acreages of sugar-cane, what to all appearances was a record crop of pa.di.
The unseasonal rains however persisted, and created serious obstacles the result the yield cf padi was reduced to a level that was much below expectations.

The weather - droughts during the spriDg crop, and continual rainfall during the Autumn crop -was also devastatiDg for the sugar crop, causing the industry tc suffer a reduction in its output performance from an expected '.590,000 to about 270,000 tons.
Fortunately Sir, there was noticeable increase in the output of the forestry sector, where value added expanded by about 2<>%, and in the fishing sector where value added increased particularly of shrimp, was quite by about lo%, and exporta, bou.ya.nt achieving a.n 15 estimated 1972.

15 Mn.

pounds compared with 13Mn.

pounde in Mr. Speaker, while we recognise the failure of the year, it is necessary two major agricultural crops to produce to capacity to appreciate during this sound.
There is in Guyanese the agricultural and capacity prevailing basically sector a substantial to produce to economy remains take advantage prices.

growth potential, of the high that the A great deal of infrastructual work to increase put under rice attest to this fact.

Credit is has been done.

The lnrge in agriculture productivity acreage now available on reasonable the Guyana Co-operative and agricultural can be acquired machinery, free of duty.
Agricultural terms to agriculture nt Bank; and other inputs fertilizers Developme through A significant development has been our ability of the regions to Already thie vegetable in the elevated so.me proportion produce white potatoes country.

consumption of production.

we can look with some degree of confidence not far off when the 13.0 Mn.

this country normally spends abroad for the importation Guyana for the benefit remain in of white potatoes would of farmers.
has been met from local into production, As more acreage is brought of the domestic to the time Mr. Speaker, With regard to the BaUJ:ite use, alumimium.
has experienced the industry, it is well known that of all the major metals in industrial market conditions Though this may not have been the sole reason, inf1ation ised countries of the industrial have in reoeat by putti.Dg a ba.rke on induatrial years been reflected to control output, in a weak world demand for aluminium.. over the past two or three yea.rs.
weakeet efforts 16 however, thnt even in this It is significant situation, by dint of imaginative the nationalized Bauxite able to maintain The fact that dried bauxite vaa due in large measure to a drastic c ut back in production, owned and controlled by the Reynolds marketing Company Company - which 1a still output.

reasonably high and diversified declined o utput and e:r:porta by a multi-national Corporation.

-Guybau -has been policies, In summary,Mr.


Speaker, the economy did suffer a as a result of adverse weather set-back Added to this was the diffioul the industrialised and other heavy equipment exportation countries ty being e:r:perienoed by t o produce farm.

themselves quantities for need them.

that now to all the countries in sufficient c onditions.

The cement shortage that is a world wide caused the construction sactor to experience phenomenon frustrating delays and to operate at much below capacity.
None of these the basic possesses.

strength and resileace that the economy factors has however, removed temporary PRICES, Mr. Speaker, I hove already remarked on the even though there vera other influences at evident in many countries - during the year largely because of imported which was serious inflation developed aad developing alike.

In Guyana prices increased inflation, work.


Average import pricas have by themselves risen at least by 15� over the past twelve months and would no doubt show little falling off in the coming months.

high interest rates and demand Monetary instability, pressures in developed partners, together vi.th supply problems affecting number of commodities like petroleum.

have all been contributory factors to the sharp increase in the countries which are our trading a 17 landed cost of our imports.
In addition there has been shortages o f other types of consumer goods some of them domestic are linked in many cases supply problems Unfortunately, problem.

The supply of eggs, poultry, to the pricing meat and pork was reduced and reduced was related stock feed for imported nvailabil to the maintenance in the context grain and other ingredients.

of the steeply rising prices of the falling quality ity of stock feed; this in turn because origin.
of controlled prices for In recent weeks therefore, it was necessary to permit price rises for a number of products stock feed, matches, flour, margarine, petroleum maintained Despite and a rigid system of price supervision, were sharp enough to cause the consumer price index to rise by at lenst 9%.

products and indeed improved.


was price controls price movements in order to ensure that supply including pork and Private Consumption Expenditur� in money terms upwards and are estimated to have expanded but it is also true that Guyanese to have consumed more in real terms.

While were trending by about 15%.

Most of the increase price movements appeared consumption declined gross domestic lower than might have been expected the year.
expenditure investment -public and private -increased, and was somewhat, at the beginni ng of would be due to Private capital formation for instance was still a level of sugar industry capital previous truction adequate outlay that was about the same level as i n building years; in addition were retarded quantities.

and cons­ of cement in by the unavailability maintained private sluggish.
The 18 -than in 1972 and compensated however, were much for the low performance outlays projected The Public Sector Capital though lower than was originally higher -by nbout S41 Mn.

in some measure Sector.

The intervention coupled with delaye in delivery of essential and equipment from overseas, implementation cap!

ta.l programme for 1973.


REVENUE AND EXPENDITURE 1973: of a number of projects of the general reduced the rate of in the Private elections, machinery included in the I now turn to expenditure and revenue p;!rformance nmounted to n of revenues though it was still Sll.3 Mn.

or shortfalls adversely resources the current Current revenue the generatio nce the financinl for financing reduced.

incom� and therefore as a from taxation; available to the budget were during 1973.
As was to be expected production in the economy depressed nffected conseque Government significantly Sl62.3 Mn.

nearly $12 Mn.

less than was originally 8% higher estimated in 1972.

Of the total revenue than nctunl receipts receipts, 130.4 Mn.

was derived from import duties.

This yield was S3.6 Mn.

less than was originally forecast was due mainly to the introduction the Common External and Common Market arrangements.

provided under the Common External with few exceptions, applicnble of CET.
Thus immediate inevitable.

It is however the revenue the introduction most of the imported goods on reduced.
and August, of from 1st Community the Caribbean The rates of duties Tnriff (CET) were, the.n the rates of duties through consumption taxes on which the duty had been prior to the introduct as a result of the adoption of the CET au lost by the change in the tariff, in the yield from import duties was that the shortfall Consequently, of compensatory it now appears in this country Tadffunder much lower reduction to recoup most of possible ion 19 on account of customs by a marked increase at *3.9 Mn.
more than the Sl2.6 Mn.

originally projected.

duties was substantially in consumption taxes now estimated off-set appears y certain about estimate.

profit returns by a number of companies earner was income tax.

are not available it aow that income tax would yield only The other major revenue Although year-end figures reasonabl $59 Ma.

or about $5 Mn.
or about $5 Mn.

less than the budgeted in the to lie essentially here appears The problem failure of the sugar crop due to weather adverse tions and low in other sectors expected amount of income tax on the basis of their 1973 perform­ ance.

The profits and therefore Bauxite Industry are largely industry, exchange US dollar -during part of the year.
the tax yield for the also lower than was projected, shortfalls in the and adverse of the -that is, a weakening as a result of the production low prices for dried bauxite rate fluctuations of the economy.

In fact it is not that the Sug�r Companies would pay a significant condi­ on Current While current revenue depressed, remained moved ahead of the amount originally Account expenditure ted.

Expenditure nt $224 Mn.

(revised).

mately $50 Mn.


more than was originally of the imreases employees which the provisions inadequate.

for that were made turned out to be At this level they in the Public Service arise from improved and to Teachers Most approved.
salll.ries paid to current estima­ are approxi­ are now estimated Members, Honourable of sal.-i.ries to the total cost was high, public servants a period of t�elve years their pay scales, public servants without any major review of was long overdue and while had gone through It should also be observed that for would recall that the revision 20 in primary schools were given the relative importance of also in aided-secondary schools in the pay to their counterparts the f irst time teachers pay scales that reflected their work.
Teachers comparable received primary schools Governmen bution to the Aided Secondary that these schools their educational parents, commencing greater responsibility country.

facilities and the additional cost t. Further, Government increased was met by the its contri­ schools in order to ensure could maintain, and indeed improve, cost to without additional through increased school fees.
In effect,Sir, this year the Goverrun.ent for secondary has been assuming education in this Public Debt payments was more also increased apparent than real.

The though in this arose from the payment to Aloan on account of the of Demba which, though payable on 31st case the increase increase nationalisation December, accounting 1972, was nevertheless put through our records in enrly January, 1973.

Capitnl Expenditures the bottlenecks despite ·At S97.8 Mn.

capital levels.
capital levels.

The main item of capital were as follows:- were also runnine quite high that occurred in the economy.

were at their highest expenditt1re foC' 1973 expenditures Project Land North 'Mest District ·Development Hinterland Roads Georgetown, West Demerara, and Berbice Roads East Demerara, Essequibo Education (Multilate Project ral Schools) $Mn., 3.0 5.0 9,5 7.5 21 Water S upply Sea and River Defence Mortgage Finance and Agricultural Development Banks Rice Rehabilitation Programme SMn.
8.5 11.7 4.0 2.4 Loan to Guyana Electricity Corporation for Equipment 4.5 for 1973 were also the highest $98.3 Mn.

Of this amount External Capital receipts level ever, totalling Loans and Credits amounted to $53 Mn., External $3.2 Mn.

and local borrowings of local loan funds includes money repatriated invested by insurance companies of the Insurance contribution.

from overseas in Central Government Investments with the provisions Act 1970 have also made a significant Grants $41.2 Mn.
This high by Pension Funds, and a substuntial in conformity securities.

amount of level Mr. Speaker, the trends I have pointed to in my foregoing remarks all underlie our external payments position.

Following low production in the key export sectors exports of domestic produce are now projected and despite higher export prices for Rice and Calcined Bauxite, about S299 Mn.

and are therefore likely to be marginally below the 1972 hand are estimated at $340 Mn.
When the deficit arising from O'..U" net imports the balance of payments indications the region of $85 Mn.

thut it would be in deficit by aa amount in on current account shows clear is taken in to account, value of !300 Mn.

Imports on the other of services at net inflows of capital would amount to about S70 Mn.

AlthoUgh this would represent the highest level 22 ·., of capital inflows achieved by this country in any the capital in the amount of about 115 Mn.
This overall one year, of balance deficit suffer in terms of external reserves.

the loss the eoonomy is likely to account is expected to be out represents 23 TI-IE PROGRAMME FOR 1974: in Mr. Speaker be!U'ine in mind our experiences 1973 the priorities in terms of financial and e conomic policy for 1974 must now be clearly identified.
First of all our maximum effort must be directed to the nchieve­ during 1974. ment of a significnnt exponsion in production The sugar industry estimates weather conditions the industry In fact during the coming ye!U' both companies in the industry would be expanding a.cernge under sugar-cane.

Tt is also a matter of some er,courog every indication strongly in favour of producer countries the next nnd the maintenance of good industrial relations is capable of producing 390,000 tons of sug!U'.
that the market for sugar would remain that given favourable ement that there is at leust during operating year or two • .Again, given reasonable wen.ther conditions output of Rice should exceed the nmount produced in 1973.

The market for rice is also expected to remain firm in view of the genern.l shortnge of and strong demand for, food grnins throughout the world.

ing there a.re no serious Bauxite production at Guybau is ex:i;ected to show n.s:rnm due to the energy crisis.
In this area the gnins in terms of quantity, disruptions real.

question m!U'k lies behind the intentions of the Reynolds Metal Compnny in terms of that company's level of output in 1974.

In foct,while this section of the industry countinues in foreign hands it would remain a matter of some difficil ty to ensure that the B1U1Xi te Industry as a whole maximises its production and its contribution conditions to the e conomy of Guyana, given the present of the aluminium m!U'ket.
24 Further Sir, Government's capital expenditure in 1974 would also be heavily weighted in favour of the pro­ ductive sectors.

Agriculture, Forestry, and Fishing will receive There w ill be large capital outlnys in Agriculture in substantial injections of public sector financing.

in the supply of food both for order to enable increases import replacement and export generation.

Output capacity in the forestry sector would be increased to meet the n eeds of both the domestic and the overseas mnrket.
At the same investment would be made in the fishing time substantial industry for the acquisition boats and the establishment of more fishing and shrimping of related shore fncilities.

In short the aim would be to increase our gross Domestic Product in r eel terms by at leoat 1.0% in the n ext yeor.

inflation to believe, policy would with a view The second objective of finnncial with the problem of inflation Mr. Speake:r; that we can dampening its effects.
It capital goods and mnny of the in the domestic econCl!ly during the be to grnp;,le to reducing its growth and would not be realistic eliminate n:i:xt twelve months.

Once we continue to :import - 8Z1d we must since we d o not produce raw materials for our industry, the inflation in the develeped countries would continue to be imported into Guyana.

It is the Government's intention however, expand price controls in order to maintain a check on price escalation.
IncreoaEd ngricul tural output should by sheer plenty, operate to pull down the p ·ice of locally produced goods, while increr-sing which the Govern­ in the distribution facilities provements m ent intends to make at the Guyana marketing·Corporation, should serve to ensure that less food is spoilt, and more the gross income to farmers.

Im­ to contimie and even 25 f ood reached households a.t che11per prices.
Improvement in Trnde Burenu are the management structure of the External expected to lead to more efficient ordering operations of tho.t Corporation, of important items of imports.

and eventually to improvement in the supply Trude with the Ea.stern Bloc c ountries including Chin11 already increasing as a direct result of Government Is the External Trade Bureau would tnke e xternal trading policy would be furtlier expanded.
In fact of the r ecent Trnde Mis3ion to China the flow of as a result goods of Chinese orgin should be rapidly incren.sed during the year.

In addition further positive steps to p romote i�portntion Bloc countries, country already hns a Trnde Agreement sign ed during the m iddle of this yenr.
But Mr. Spenlrer, all this inevitably implies that the External Trade Bureau would need to take finner an:i wider control of our import trade in order to ensure that the direction and content of that tr::ide nre responsive the 3oviet Union with whom this to the national from Eastern including interest.

It would also be Government1s policy to ensure that interest rates remain stable.

Mortgnge in�erest charged by the Guynna Co-operative Mort::;-nge Finance Bnnk range from 6]% - � per annum.
The Government the interest rn.tes charged by Insurance in Guyana to ensure that they are kept as low as c onsistent y. with reasonable would begin to monitor Companies operating profitabilit Obviously, Mr. Speaker, while the Government moves to reduce i1�lationnry pressures, for wage increments thnt nre tied movern.ents prices.

The fundrunentn this stn.nd is n ot difficult to appreciate.
ndju::itments in o. situation way to l reason for Automatic it wrn<ld frown on demrurls in n.ny automatic of consumer where prices are al::-endy trending wnge upward.a, is in practice highly inflationary.

Waaea would chaee prices, and prices would in turn chase wagea vi th the inevit&ble result of a. vicious inflationary spiral.

Instead the Government would continue adjustment baaed on periodic review of wages and salary ra.tes.
to favour • system of wages of finazicial policy in It would be another objective 1974 to ensure that our foreign exchUJ88 earnings a.re car.­ f'u.lly utilised and the Reserves restored to a. reasonable level.

Fundamentally this will be a :function of increased outpit or our export commodities.

Inoreaee4 would not be enoll8h, however, if the expanded Capital pro­ gramme for 1974 ie to be imple11ented vi thout undue stresses on our bala.nce of payments.
Substantial inflows of external financial resources would be nscessa.ry in order to pq for the imports of c apital goods.

In addition,Mr.

Speaker, Government would need to give aerious c onsideration to further .

restrictions non-essential imports in order to accommodate imports of capital and other production goods.

expgrta ill 1974 ConSU111.ption would therefore need to be voluntarily consumption carry the main burden of taxation.
It restrained during 1974, so that darestic savings may be increaeed, and foreign e:z:chMge conserved.

In this c omJection the GoverDDlent would use fiscal measures to ensure that � essential lllllBt be self-evident, Mr. Speaker, that tbs money to finance our developnent secured from external sources.

Guyanese must bear a sane­ what hea.vier burden then in years past to firumce the developnent programme.
This means that aa.viJ:l88 - by individual persons, by businsss enterprises, and piblic, end by the Central Government must be incrauad.

programme cannot, and should not .at all, be both priva.ta 27 The Government contain its own consumption least to a level that matches its revenues.
on its part would aleo seek to of g oods and services at are expected to increase their lity so that with but one Public Corporations and profitabi exception efficiency possible and adequate Private businesses curbs on distributions individuals consumption, for re-investment.

returns on capital the need for eubsidy would be removed, would be earned.
voluntary would need to institute in the same way that private invested would need to exercise restraint in so that private savings may be increased It would be observed Mr. Speaker, that the financing of the Government's Capital budget for 1974 will require at least S32 Mn.

of local savings.

This of course is quite apnrt from the savinga which will need to be channelled into private investment agriculture, forestry, and manufacturi!lff.
such as house-building, The Government recognises profits in order to expand and create that private industry In pursuing the its pricing policies would pay due regard to this fact.

Indeed must make reasonable employment.

Government every encouragement, would be given investors Of partic�lar significance incentive including Guyana.

The scheme provides for more generous incentives in this country.
than had hitherto been available to fiscal, administrative in this regard is the scheme n�J applicable to establish industries to all CARICOM countries in Guyana.

new fiscal industries and financial, It would be necessary to beeome more familiar with the provisions of this echeme so that adequate for entrepreneurs may be taken of them.

advantage It is recognised thnt the development anticipated 28 would hardly be achieved unless credit is made available t erms.
Accordingly further budgetary on attractive allocations have been made to increase the lending resources available to the Guyana Co-operative Mortgage Development Bank and the Guyana Co-operative Finance Bank, both institutions having been established about the middle of this year as projected in my last budget speeoh.
Further in order to provide loans to facilitate Industry Development ed within the Guystac would essentially be to provide capital to small business enterprises, and assist them further in terms of .management and feasibility studies.

of small businesses a Small Corporation w ill shortly be establish­ Group of Corporations.

Its functions the establishment Agricultural Mr. Speaker, if serious bottlenecks do not recur, if the threatened fuel shortage does not prove too acute.
and assuming the weather holds good, 1974 ought to see an impressive growth together with the e%pansion of economic activity which it suggests, particularly in construction, agricu1- ture, fishing and forestry, would lead to the creation of a large number of job opportunities.

resurgence in economic growth in Guyana.

This REVENUE AND EXPENDITURE 1974, I now turn to the Revenue and E.J:pendi ture progrrume for 1974, The Government Mr. Speaker proposes to spend appro%­ imately 1222 Mn.
on current services during the fiscal year 1974.

Capital e.J:penditures are projected at 1173 Mn.

making a total budgetary year under review.

This e.J:pend.iture increase of appro.J:imately outli:zy of 1395 Mn.

during the 173 Mn.

above the Revised represents an Estimates of Current and Capital E.J:pend.i tures for 1973.

29 The letimates of Expenditure on Current Services with (lf '!

;:-,.4 Mn.

compared for 1973.


There were certain in 1973 which would not recur in to in lieu of retroactive pay would b• the lumpsum payments with the recently the Expenditure and the concluded Estimates general assume the establish­ will be made to prevent more rapidly than is absolutely In addition a red·,wtion associated in 1974 anticipate the Revised Estimates occurring expenditures 1974.

Chief nmong these public servants expenses elections.
that every attempt ment from expanding necessary; staff first to Ministries Further, certain employed.

This therefore account current expend!

tures for 1973. this would be achieved needing explains why the provisions are slightly lover than the revised for 1974 on by the re-allocation them before services have been reduced.

of new staff is Of the total expenditure of Personal of $94 Mn.

is on account with S93 Mn.

in 1973 (Revised); to Debt Service $47 Mn.

in with SB3 Mn.
in with SB3 Mn.

(Revised) compared with a revised 1973; and S78 Mn.

for Other Charges for 1973. expenditure of expected for 1974, a total compared Emoluments, S50 Mn.

is with respect compared The services increases Internal S4.9 Mn., Co-operatives are Defence Security$7.8 $1.3 Mn.

reflecting Sl..2 Mn., Foreign Affairst:l.

Mn., Education the most signific ant 9 Yin., Sll.9 Mn., Health CAPITAL EXPENDITURES: As I said earlier,Mr.

Spenker,an amount of $173 Mn.


capital for Government's is projected This high level of level of capital Sector in the 1972-76 the continuati 1974 is heavily weighted in expenditure expenditures Dsvelopment on of on-going projects with the is consistent projected for the Public Apart from Programme.

favour of projects which are outlays for 1974. the programme for expected to yield high economic and financial returns within a short period of tims.
Constrained as we must be by the aTailibility of sufficiently large amounts of soft money a deliberate was made to give the highest priority to the high and a lower priority for this on some social services, of economic year to as important In fact, decieion yielding projects the expenditures these are to the process 1 t would be observed that the sectors identified for capital agriculture, manufacturing, are necessary to support growth and development in the sectors enumerated.
The programme therefore distribute expenditure ing manner: sectors forestry, mineral development, that and the infra structural facilities proposes to in the follow­ in 1974 are the productive among these sectors devslopment.

fisheries, injections of Agriculture, Water Control including Fisheries Mineral Development Manufacturing 5,., Mn.

8.5 Mn.

,.6 Mn.

8.6 Mn.

A sum of S0.4 Mn.

will be spent on the Kibilibiri Dairy Project, S0.4 Mn.

for project farmers; Rivsr, Sl.O Mn.


is on the Berbice of the Moblissa for the expansion agricultural provided and the settlement of displaced purchase of rams and bucks, and for the swine development unit.

In addition Sl.6 Mn.

will be expended on the World Bank assisted cattle development, laboratory programme for livestock proposes to increase shrimp and to this end S5.2 Mn.

has been allocated the cost of 28 shrimp trawlers Government also the annual catch of to meet and S0.8 Mn.
on which is essential for beef expansion project; S0.2 Mn.

on other development.

substantially a veterinary the success of the in 1974; this is in addition diagnostic 31 to S3.0 Mn.

for the establishment freeziI18' facilities.

of better on-shore Provisions have also been made for the improvement the programme of expanded to complement production.

A total provision of water control agricultural has been made for this purpose.

Of this total Sl.l Mn.

has been allocated $0.3 Mn.


to the Black Bush Folder/Block III Area; and SO.a Mn.

to the West Demerara area.

Further, 14.3 Mn.

has been allocated for the of drainage pumps in other areas.

to the Kahaica/Mnhaicony/Abary area; purchase and installation of S9.8 Mn.

The improvement coastal land.a will continue and a provision of Sea Defences aloilB' protect 15.9 Mn.

has been made available on the Georgetown in othsr areas.
Sea Wall and of works to cover cost of of works the continuation the coast to Government will embark on the establishment of a the Upper Mazaruni river and wer facility in hydro-po on of this plant by 1978. constructi expects to complete In 1974 provision of SO.

9 Mn.

has been made towards the preliminary investigational with the pro­ ject.
work connected Complementary to this programme for hydro-power for the construction t is a programme developmen weather road in the Upper Mazaruni from Wineperu to KamarailB'• Construction trnnaportatio hydro project the hydrO"" power plant.

n of heavy equipment site by 1976 to facilitate has been planned to permit the aloilB' this road to the of of a fair construction Provision of 13.

0 Mn.

has been made to commence the 1974 phase in the construction Upper Mazaruni.
When completed to providiI18' the road access to the hydro-power of this road to the site, open up vast will, in addition 32 areas of rich agricultural lands and thereby in that part of our the stimulus hinterlands.

for new settlement provide In 1974 Sl.5 Mn.

will be sepnt on the initial phase in the establishment of a cement factory; Sl.O Mn.

on a glass factory; 12.0 Mn.


on a teztile on a leather These outlays are which will be made available Corporation in addition to the to Small Industry tannery and S.5 Kn.

on a Clay brick factory.

of $3.0 Mn.

Development · • to slllll.11 scale industries for on-lending p rovisions mill; S.3 Mn.

There are further allocations for the continuation already stnrted of projects investment in some socinl keeping with the objectives outlined Development Plan.
These will include providing improved Henlth services, improved ($1.5 Mn.).

in the 1972-1976 allocetions Educational facilities ($10.1 Mn.)

and for and the mo.intennnce of capital and other basic services, in FINANCING 1lIB PROGRAMME, for 1974.

It will be recalled to $173 Mn.


will reliance amoua.t markets, Financial I now come Mr. Speaker to the financing of the programme envisaged capital that the capital expenditure proposals In the financing of the amount, substantinl be placed in the coming year on borrowing International imately $75 Mn.

are expected Government has genred the accordance for 1974 in with this borrowing.
maturities nssociuted some $28 Kn.. are expected from bilateral the United States, to particular with respect These are in the expansion, main sea defence, roads, electricity supply, textile factory, and a clay brick factory.

from this source and the composition projects.

with the higher costa and shorter In addition Cnnada, the United Kingdoa, and China, of its capital lllll.inly in Europe.

Approx­ sources mainly pure water on the budget 33 schools Development -that is, Further suas ( 1:,-2' Mn. )
are expected from the and regional sources Banlt.

In the main these would Bank from the Cnribbean Development World Bank and ID.A finances for roads, sea and livestock aul.tilateral Caribbean include development, defeace, multilateral and loans to the Mortgage Finance Bank and the Agricul­ tural Development Bank.

There are also grail.ts amounting to 15 Mn.


from United Nations Development In total thel'efore approxillllltely oapital foreign Guarantee Export Import Bank of the United States for water control puaps.

In both cases agreements have already been signed a:nd equipment plaoed on order for expected delivery during 1974. .

The foregoing sum.

also includes under the Export Credit for equipment 1140 Mn.

from external sources, for its the Government e:i:pects to derive Programme and other sources.
programme credits in the United Kingdom, and the arrangements In order to finance the rest of the programae that long term borrowing from domestic it is anticipated sources would yield 125 Mn.

There is left a snall deficit of 17 Mn.

REVENUE COLLECTION, Mr. Speaker, as the Honourable Members are aware proper taxes, aad so far they there are a large number of persons who have studiously evaded the payment of their have been successful in their evasiont whom the income tax has never reached.
of those who have managed to ruaass substantial arrsars It is rsnts and proposed that in the new fiscal year all revenue depart­ ments, particular Licence ly the Income Tax, the Customs, of National and the Ministry there are others There ore also due to the Government.
Revenue Office, payments, similar the 34 their procedures, Development and Agriculture would redouble their efforts, stream-line inconsiderable powers granted to them by law, and if necessary employ additional persotlB, to ensure that revenues liable to tax are brought to book.

In effect, collection paoe of revenue due to the Government nre paid, and utilise persons Sir, the the not in 1974 would be accelerated.
FINANCIAL MANAGEMENT, Another matter of serious concern is the question the Public on our Independent Statu.s, and also in the rate of economic develo� at Independence in 1966, with a Capital of 1108.2 Mn.

(124.1 Mn.

on Capital and of financial management.

Since Independence Service has e::ipanded rapidly to provide both for the services attend.ant an endeavour to accelerate ment.

Starting expenditure 184.1 Jin.


on current services) has been called upon to manage, has the Public Service more than trebled to 1395 Mn.

in 1974 in eight years, (1173 Mn.

on oapital and 1223 Jin.

on Current Services).

It is obvious that a far higher degree of skill on financial management is required these skills would have to be spread wider to achieve and maintain ma%imu.m.

efficiency.
efficiency.

the financial resources at present and also that thllll in 1966 of - of Csntra1 Government in this field has also bean rapid, Promotion of the accelerated e%pansion Ths result has been that and responsibilities.

available at the various Trainine courses, cadres have but much more bas because services the level of skill previously levels has been effectively both local and overseas somewhat in alleviating to be done if we are to function efficiently in this fieU.

lowered.
lowered.

among various the difficulty assisted long term to support � practical A stu.dy is at present in progress to and Government needs in this area, determine would wish to this problem.

solution the 35 training.

I therefore in the short run the solution However, organised year in collaboration with the Public Service Ministry, to arrange that suitable courses of for public officers involved within Ministries training are mounted administrati and Departments.
in financial in the coming propose, must lie in on Mr. Speaker, before I come to the question of our presentation of I should perhaps of the financing the gap on the Current budget, first explain Government Capital.

a peculiarity programme expenditure for Current services and of development of Expenditure largely is and administrative in this country arrl in promotion the expenditures of incurred are Estimates.
However, The Government is in fact deeply involved in must depend to carry on For insto.nce the pay of t he who have written the plan and who must in a 'Whom the Government programme.
its implementa the cost of the Engineers, economic development of that development, reflected in the Capital substantially of the cost portion a significant reflected Estimates in the Current to meet the cost of the professional personnel on the development economiste sense monitor budget; Architects implementati defences, drainage and irrigation schemes, charged public service professionals those who conduct hydro-power developm the development three activities.
It is,therefore, for us to understand consumptive substantial developmental in its content, amount of expenditure the preliminary ent.

and those and Overseers, on of capital that the current to the current in purpose.
budget; but in fact contains a are also to the the same applies who must implement who plan o.nd supervise projects such as roads, sea the budget is not pu.ely which are in effect tion is a charge on the current Quantity Surveyors, who carry out mineral surveys, with studies coo.nected programme in Agriculture, to identify only Mr. Speaker, importo.nt 36 estimates as presented Hoving said this much Mr. Speaker, I would now turn to the fiscal proposals which the Government intends to impose for 1974.
I have already indicated current $222 Mn.

and for revenue anticipates of $203 Mn.

This leaves a gap of 119 Mn.

which must now be financed.

The Government additional 119 Mn.

so as to ensure current therefore to yield something in budget is brought into balance.
forecast an expenditure of proposes to impose taxation the region of that the a total receipt that as far as practicable the The burden of the extra taxation will fall on time has come when non-essential should be restricted in the interest of saving consumption because the consumption for development.

the tax burden would fall essentially Although on consumption, the taxed items are renlly those llhich are non-essentials.
In other cases a specific tax ha.a been placed on certain that these export commodities limited amount of extra taxation in view of bouyant export prices.

The following posals:- items of exports, becnuse could bear the burden of a therefore are DO' tax pro­ it is felt Beer -the excise tax on beer would be increased by Sl.26 per liquid gallon.

This should mean that if all the tax is passed o n to the price for a bottle of the con.sumer anywhere beer consumed increase expected yield would be S2.6 Mn.
by no more than 8 cents.

The in Guyana should 37 Electrioal Appliance•, other tha.n ie�ratore:- (Washing Machines, Records, Air Conditioners, Radiograms; Gramophones, Gramophone Records, Vacuum Cleaners, Dishvashere Radios, etc.)

A consumption tax of 15% is proposed.

The yield is expected to be $0.4 Mn.

Aerated Vatere:- A Consumption Tax of 2 cente per bottle is proposed.

The expected yield is 12.5 Mn.

:Kolaseee:1- The production of this commodity is almost wholly geared for the export market.
For a number of yeare an export tax was levied at 45 cents per 100 gallons.

Since then the reported export price for molaeses has gons up steeply and it is therefore proposed to increase the export tu by 4 cents per gallon, that is, to 14.45 cents �r hundred gallons.

The expected yield is so.5 Mn.

Motor Cara,- for private uee would now Motor cars registered purchase of 15% on their show pay an additional room prices.
The tu would however apply only to motor cars over 1600 cc and would n ot apply to hire cars.

The expected yield is S0.6 Mn.

Cigarettes:- 13.03 per pound to 16.23 per pound.

The consumption tax on cigarettes is to be increased from If the total tax is passed on to the consumer• the price of cigarettes than 8 cente per pack of ten, nnd 16 cents per po.ck of twenty cigarettes.

The expected yield is 13.5 Mn.


should increase by no more 38 Gaaolene:- The c onsuapt:l.on tu on Gaaolene will be increased from '37 cents per gallon to 49i' cents per gallon.

!rhe expected yield is Sl.6 Mn.

Shriap:- The export tu on this comaod.1 ty is now at the level of 12 cents per lb exported.

It is nov proposed to increase the export tu to 19!

cents per pound.

The expected yield is Sl.

'3 Mn.


Licences for Liquor Restaurants and Hotela:- Liquor restaurants at the mount pq $600 per year in Georgetown and Rev Aastardam.

and 1480 elsewhere.

It is proposed to increase thie tax by 1200 in Georgetovn and 1fev Aas terdaa and by 1150 elsewhere.

In the o8.8e of hotels it is proposed to 1ncrea89 the tu OD first clase hotels in Georgetown and Rev .laterdem by 1200 and by Sl50 OIi second class hotels in Georgetown and 1fev A.msterdaa.
Betting Shopa:- It is proposed that each person who oarriea on a betting service on any premise meke a deposit, interest Government as a prior condition for the issue of a licence to operate the servioe.

to free, of 150,000 Yi.th the would be required The yield froa these measures applicable to betting shops, liquor reatavanta and hotels is ast:l.aated at S0.5 Mn.

1fational Development Surtu::- It is proposed to levy a aurtu: of 5% on the charge­ able i ncome of all indirlduala, corporated enterprises.
It should be explained that the tax is applicable only to inoo• which is subject including Unin­ 39 and otherwise, Thus have been deducted.

to n ormal income tax after all allowances, personal who earns S2,400 per annum and has an individual a wife, two children, and an insurance policy on which he pasrs a premium of S60 per year, would have a total deduction S600 of $800 for himself, for his wife, $600 for the two children, for his insurance income allowance.
up to $2,180; and, therefore, his chargeable income would be $220.

Consequently Development per year -less than Sl.00 per would be collected and administ similar to PAYE, The expected premiums His total allowance month.

The tax ered in a WO¥ yield is $5 Mn.

Surtax would be 5% o f 220 i.e.


Sll.00 and Sl20 as an eurned would add S60 this National Tax:- Property of debts to 20% and 50% on assets respect­ The limitation in the case of companies ively, for the purpose of determining net property subject will however scale - to property tax, will PO¥ property be removed.

tax on the following and individuals, Companies Up to s500,ooo Over S500,000 ... ...

The expected yield is So.2 Mn.

The total yield arising from the tax measures would therefore be $18.
7 Mn., and this should be about adequate to cover the gap in the Current Estimates, 40 that we are a Xr.

Speaker ve must recognise society still prone to consumption; a society whose taste is still foreign oriented, we a.re a people who have not yet reoognised that the road to development is 1\l.11 of rigours; that development is expensive and must be paid for.

Ve have presented what is in many ways a to others in thls country?

Sir, we cannot look constantly hard budget.


Indeed we had to talce ha.rd decision.

But is this not all the price we have to pay if we are to see real development Certainly for help.

If we must look for s uch help, and �rhaps we have no choice, to show that we tightened us also demonstrate development after increased productivity on the job; and let us use only our increased iaprovement in our standard way brings illusory and transitory gains.
and that we are production, prepared to strive and improved productivity as the basis for of living.

Any other let us at least be able our belts first.

Let that ve are serious about In conclusion Mr. Speaker, I merely wish to say that the Budget of 1974 is now before this National Ve have demonstrated I thiDlt Sir, our real concern for the development of this country.

We have noted its weaknesses and its strength.

should be dons to improve the people of this �ountry.
I would only hope Sir, that we all recogniee that develo�ment operative we can pull this country forward to o'Dly by hard work, self restraint, our ideas as to what the lot of it and consequenUy Ve have p ut forward effort.

and co­ Assembly.

Let us look for help Mr. Speaker, from those who will help, but let us assist ourselves at the same time.

That is the epirit and the message of this BudgetQ