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Minister For Finance Blasts Opposition

Minister for Finance Aiyaz Sayed-Khaiyum yesterday tore apart the Opposition response to his 2016 Budget address. In one of the most animated right of replies by a Finance minister, Mr
18 Nov 2015 12:13
Minister For Finance Blasts Opposition
Minister for Finance Aiyaz Sayed-Khaiyum,

Minister for Finance Aiyaz Sayed-Khaiyum yesterday tore apart the Opposition response to his 2016 Budget address.
In one of the most animated right of replies by a Finance minister, Mr Sayed-Khaiyum accused the Opposition MPs of misrepresenting the facts.
The Opposition interjections were drowned by Government claps in support of Mr Sayed-Khaiyum as he went on the offensive.
He told Parliament: “They (Opposition MPs) need to get their facts rights.”
He said the Opposition “needs to have a better understanding of the debt matrix.”
He said when “you incur deficit, nominal debt will increase.”
He was responding to Opposition’s Finance spokesperson, Biman Prasad, who claimed that Government debt was a worrying problem. He said it had increased from $3.7billion to an estimated $4.4billion.
Mr Sayed-Khaiyum said: “They obviously do not know the difference between flows and stocks. Debt is the stock figure, debt servicing which is principle interest payment is a flow figure.
“Honorable Prasad’s version that for every $3 of Government’s revenue, $1 is of debt servicing in fact is a misrepresentation of the real outlook.”
He said in 2014, $465 million on 19.6 per cent of total revenue accounted for debt servicing “which equates to revenue of 5 is to 1”.
“Perhaps he (Mr Prasad) has to brush up on his debt dynamics understanding.
“Debt servicing stood at 26.5 per cent of total revenue in 2005. So there has been a relative decline in terms of debt servicing as a share of revenue.
“We are currently at the moment offered lots of loans but we have been very prudent. World Bank, IMF, ADB but we have been very prudent in our borrowing. We only borrow to build.
“Even these loans we are getting the interest rate ranges from less than one per cent to three per cent.
“Over the last five years, Government has been recording operating savings. The operational cost is not paid for by borrowing money. We are generating enough revenue to pay for operational costs. “We only borrowed money to build. In 2006 Government revenue was $1.4 billion, in 2014 Government revenue was $2.67 billion, an increase of 17 per cent.
“What we have now is the Government spending which is excess of operating revenue over operating expenditure have increased from $27million in 2006 to $573 million.
“Because in 2006 the previous Governments were operating with capital expenditure mix of 85 is to 15. In other words 85 per cent of the money was spent on operating not building; building was only 15 per cent.
“Now the expenditure mix is 55 to 35 in 2014 and next year the mix will be 60 to 40.
“The other side cannot deny that capital investment adds to the productive capacity of the economy which is evident in the sustainable economic growth that we have seen in the last five years.
“Madam Speaker they need to get their facts right. The last five years the Health and Education budget have increased substantially. Their talk about contingency liabilities to the tune of $2.4 billion is an utter lie.
“Out of this $2.5 billion, $1.73 billion or 69 per cent relates to the guarantee of FNPF members funds. In fact the exclusive liability is $772 million.
“We are focusing on health, housing and we are continuing to do that. I think it’s an insult when the other side says the low income people don’t need anything other than flour, rice, oil, kerosene, powdered milk, tea; it’s an insult to them. They think they don’t need clothes, they don’t need hard wares, they don’t need a house, they don’t need sugar, soap, bread, biscuit, onion, potatoes, garlic, fruits and vegetables, noodles, curry powder, dhal, as well as basic necessities women tampons, toothpaste, soap, toilet paper, mosquito coil, deodorant and others. What a joke!
“On the Shadow Minister’s speech I laughed the loudest but unfortunately like the Greek tragedy it was a comical tragedy.
“They came last year saying the budget was boring, this year they saying it’s deceptive, they can’t even get that right.
“When I was at Kavanagasau some of the people came to me and told me and I translate: ‘Some of the Opposition don’t know what they are talking about’.
“On this side of the House, we were setting the platform but they (Opposition) were so busy trying to poke fire at every small thing instead of looking at the big picture. We are here to look at the big picture.”
Parliament yesterday started its deliberations on Budget heads.

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