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Thursday, November 30, 2023

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Summing Up The Appropriation Bill 2022-2023: Dr Padayachy And His Strategies To Restore Purchasing Power

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The Minister of Finance illustrated this summing up of the 2022-2023 Budget around the themes of development, efficiency, and solidarity. However, he recalled that the country will not be able to escape the new economic landscape brought about by the pandemic, the Russian-Ukrainian war and the global crisis. However, he criticized the Opposition for its ploy to “forget the crisis, its political DNA and its poor performance”.

The middle class is not the GM’s cash cow

Purchasing power and especially for the middle class. These are the biggest concerns after the Budget. Renganaden Padayachy said the Budget 2022-2023 has pushed the boundaries of the accounting exercise to make it a trust pact between the government and the people. “The middle class is not the cash cow of the government, but the government has made the protection of the purchasing power of the middle class a national emergency.”

On this point, the Minister deplored the “lack of humanism” of the Opposition in his criticism of the Opposition. “It is not Rs 1,000 that will make people forget the misery. Do they realize their lack of humanism and lack of respect? If for them, Rs 1,000 means nothing, for the common Mauritian, this Rs 1,000 note is a commitment, an act of faith, a lifeline.” He said that the government has at heart the interest of the purchasing power of the population following the latest global calamities, which influence the supply and cause the high cost of living of Mauritians. But he stressed that through this Budget 2022-2023, the government has come to relieve low-income households, the middle class, pensioners, but also Mauritians affected by a disability.

“Those suffering from a disability of less than 60% were not receiving the Basic Invalid Pension. This Budget 2022-2023 has redressed this injustice. Some 10,000 Mauritians, whose disability is between 40% and 59%, will benefit from the CSG Disability Allowance,” he said in response to his critics in the Opposition, recalling that this monthly financial assistance of Rs 2,500 will be added to the existing benefits of the Social Assistance.

GM’s efforts and optimism

According to the Minister, the devastating Covid 19 has caused Mauritius to lose about 15 points of GDP in 2020 and two successive contractions of 7% in 2019-2020 and 6.2% in 2020-2021.  The hospitality sector has been hit hard, especially the goods and services exports sector, “The level of exports of goods and services has fallen from Rs 192 billion in 2019 to Rs 128 billion in 2020 and Rs 132 billion in 2021, making a total of Rs 120 billion.” He recalled the GM’s support to the population and to businesses as well as the government’s commitment to the people, putting global conflicts and the pandemic second. “A support of 32% of GDP, which is the 4th strongest State response to the crisis in the world, according to the World Bank. Public sector debt will gradually decline from 87.4% of GDP by end-June 2022 to 78% by end-June 2023,” he said, implying that the GM will reduce public sector debt to less than 80% of GDP two years earlier!

Renganaden Padayachy made it clear that the GM is quite optimistic about several sectors, such as tourism. “Mauritius has gone from about 1.4 million tourists in 2019 to 300,000 tourists in 2020 and only 180,000 in 2021. We will welcome over 550,000 tourists by June 2022, 1 million tourists in 2022 and about 1.4 million tourists in the fiscal year 2022-2023. Every 100,000 additional tourists bring 0.6 percentage points of growth,” he said.

To sum up, according to Renganaden Padayachy, “Mr. President, with the 2022-2023 Budget, we are concretely relieving the Mauritians in their struggle against the high cost of living” and he listed the efforts and reforms of the government and made a comparison between the former government and the current one. He concluded with the strong points, such as the minimum wage, which is now Rs 11,075, the increase in various pensions, the various subsidies on basic products including fuel!

He tried to shoot down all his detractors by ending with a quote from Victor Hugo’s 1862 Les Misérables. (translated here) “Daring to progress is at this price, to try, to brave, to persist, to persevere, to be faithful to oneself, to take fate by the hand, to surprise catastrophe by the little fear it gives us. Sometimes confronting the unjust victory, sometimes insulting the drunken victory. Stand your ground, stand your ground! This is the example that people need and the light that electrifies them”, inviting the Opposition to “ask forgiveness from the people to whom they have caused the trauma that we are trying to repair”.

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