On 29 July 2021 the Anguilla House of Assembly passed the GST
Act into law. Controversially, two
Ministers of Government voted against the adoption of the Bill, while the two
ex-officio members of the House, the Attorney-General (A-G), and the Deputy
Governor (DG), voted in favour of the adoption of the law, thus ensuring that a
slim majority of one was attained, and the GST Act was passed into law.
An uproar arose in the community when
the significance of these events sunk in. Members of the public protested on social
media that the actions of the A-G and the DG contravened the convention that
the ex-officio members do not vote. The
A-G and the DG never previously voted on any motion before the House.
Few appeared astonished that the two
Ministers who voted against passage of the Act continued to function in
government. Every Anguillian schoolchild
knows that ExCo is collectively responsible to the House of Assembly for the
conduct of government. Once ExCo has
taken a decision, no member may express public dissent to it without resigning. This is known as the principle of collective
responsibility. When the two Ministers
did not resign their portfolios, they should have been dismissed by the Premier
and gone to the back benches. Instead,
they continued to serve as Ministers as if nothing had happened.
The main objection that was aired on
the radio and other social media was that the Foreign and Commonwealth
Development Office (FCDO) put unfair pressure on the local administration to
enact the law. This is a conspiracy
theory. It also misses the main point of
the assault on the principle of collective responsibility.
The reason government insisted on
passing the Act was that we were bound by our promise made in exchange for
large sums of money to do so. The lack
of public consultation before the law was passed is a systemic problem in
Anguilla. It is standard operating
procedure in Anguilla. Until the present
Speaker started insisting on it, it was almost unheard of for the public to be
consulted on any proposed new law. But whether
there was adequate consultation or not, the Act had to be passed.
The FCDO say with justification that
Anguilla’s government is too expensive. In
some cases, we employ five persons to do the job of one. The FCDO point out to us that if we cannot
raise the local revenue to pay public service salaries, we must either cut the
cost of government or we must raise the taxes to pay for it. They insist that there is no reason their British
taxpayers should pay for Anguilla’s expensive government.
However, no Anguilla Government appears
prepared to either cut back the numbers of the public service or reduce their
remuneration. It is said that it would
be political suicide for government to do what is needed and make half the public
service redundant. The banks warned that
letting go large numbers of public servants or reducing their salaries means
that hundreds of loans will go into default, and social distress will
explode. The only alternative left is
for us to raise our own resources to meet our public costs.
Meanwhile, employees in the private
sector are not as pampered as the public service. While hotels let their staff go for over a
year on at most half pay, public servants continue to receive their pre-pandemic
salaries in full. There must be hundreds
of private sector employees who are unable to pay their rent or their mortgage
instalments. Salt is rubbed into their
wounds as the hotels curry favour by part-time employment of public servants. These come cheap since there is no need to
pay holiday pay, social security, medical insurance, or interim stabilisation
levy on “temporary” gig workers.
The last Administration hired
consultants to advise on the most appropriate way to raise additional
revenue. The recommendation was that a
GST would do the job. The Eastern
Caribbean Central Bank (ECCB) and the Caribbean Development Bank (CDB)
concurred.
Instead, we fell back on British taxpayers’
generosity to meet our over-indulgencies.
After Hurricane Irma in 2017, the last Administration got 60 million pounds
sterling (EC$240 million at a four to one exchange rate) in grant aid from the FCDO. This grant was labelled “humanitarian aid”. In fact, it was earmarked for capital
infrastructure, namely, the building of new facilities or the repair of damaged
ones. We had no reserves to pay for our
structural upgrades ourselves. In
return, we promised that we would cease to rely on the British taxpayer and
raise our own revenue in the future. We
would enact the GST Act. We did
not do so.
Early in the 2020 pandemic, and the
closure of Anguilla’s economy, the previous Administration got a further EC$100
million in grant in aid. This was
intended specifically to pay civil servants for the following ten months. In exchange, we promised again that we would
either enact the GST or cut the cost of the public service. We took the money. We did not do as promised. The previous Administration then lost the
election.
The present Administration came into
office a year after the first aid grant, accepting yet another EC$100 million
from the FCDO. We were given this aid on
the repeated undertaking that we would do what the previous administration had
promised: either increase taxes to cover
our expenses by enacting the GST or reduce our expenses.
The new Administration missed the
perfect opportunity to bite the proverbial bullet and cut our public service
expenses. They had promised during the
election campaign that they would not agree to accept the EC$100 million if it
meant passing the GST. But, once in
office, they faltered and grabbed at the seemingly easy option of taking the
money and agreeing in exchange to pass the tax into law.
The British taxpayers’ money did not
last long. It has run out. Now, the CDB has agreed to make us a loan of
EC$30 million on the same promise that we would pass the GST Act. The CDB was more astute than the FCDO. This loan was conditional. If we didn’t pass the Act by a certain date,
we wouldn’t get the loan. We passed the
Act just in time with the vote of the A-G and the DG. Now public servants will get paid for the
next three months.
The FCDO did not force us to pass the
GST Act, as some are saying. We took
their money, and the money of others, on a solemn undertaking to begin to pay
for our expensive government ourselves. If
we do not live up to our promises made in exchange for hard cash, then we are
nothing but a bandit state.
We have no one to blame for our dire
circumstances but ourselves. Blaming the
“white British” for our present problems is pure xenophobia if not downright
racism. Let us face it, Anguillians
always delight in blaming others for our misfortunes. We are never to blame. It has always been so.
Poverty in Anguilla is being held out
by the protesters against the GST as a reason why the GST Act should not
be passed at this time. There are some
poor people in Anguilla. The Annual
Reports of the Department of Social Development do not provide any figures for the
number of families in need. A close
examination of their most recent report for 2016 on the government website suggests
the number is between 100 and 300 households.
We do have an obligation to prepare a social safety net to take care of
those who through no fault of their own are unable to do so. But even a blind person cannot be oblivious
to the proliferation since Hurricane Irma in 2017 of SUVs and CRVs on the roads
of Anguilla. Even now, at the height of
the Covid-19 pandemic, there are new villas going up on nearly every street
corner in Anguilla. There is no shortage
of money in circulation in Anguilla.
One must conclude that Anguillians
are generally a wealthy people. There is
no shortage of resources. It is not as
if we cannot afford to pay for our public services, which are presently subsidised. Our culture of expecting all public services
to be subsidised while we pay few or no taxes must change. Our tradition of objecting to every increase
in government fees and taxes cannot continue.
How we are going to pay for our public
administration once the loan from the CDB runs out is going to be the question.
It will be interesting to see if the present Administration can continue to mamaguy the FCDO as the last administration did so masterfully.
