Cup bucks

Security and health care are the two major items driving government spending ahead of the 2007 World Cup (CWC). That's according to Prime Minister and Minister of Finance Owen Arthur, who has committed government to spending around $90 million to play its part in the Caribbean's hosting of the world's third largest sporting event next March.

Arthur was speaking with the Nation in an exclusive interview shortly after laying the 2006-2007 Estimates of Revenue and Expenditure in the House of Assembly yesterday.

"These Estimates are occasioned by one major consideration," Arthur said, "that over the course of the next financial year, we have to fully honour all of our Bid Book World Cup major obligations insofar as they have financial implications." Barbados, he added, did not now have a choice as to whether it had to meet those obligations - it had to be done by the end of March 2007.

"So these estimates are driven by the obligation to honour World Cup related activities," the Prime Minister said, "and the one big change is that there is a 27 per cent increase proposed in capital expenditure."

Capital spending moves from just over $220 million to $300 million, he disclosed, but most of the increase would drop out after next year because it would be a "one-off" expenditure. "Notwithstanding, we are still trying to bring the Estimates in line with the fiscal target of 2.5% of GDP. So even though we are bringing World Cup expenditures to account, we are still honouring the obligation to try to be as fiscally prudent as possible."

Arthur noted there were other expenditures that would have been triggered by commitments given in the January 2006 economic statement, such as $3.6 million to 2,417 people with certified severe disabilities who began drawing $63 weekly from last month.

He stressed, however, that World Cup expenditure had not been done at the expense of social services, although he was concerned that there were areas in the public sector delivery of services where costs had been spiralling out of control "a bit".

Explaining the "drastic growth" in spending on security and health care, Arthur pointed to the expansion at the air and seaports; a new telecommunications facility for the police; international conventions that required spending; and a mass casualty facility at Jemmotts Lane.

He added that there was an expanded programme for construction and government was also trying to fix the roads and highways as well as the island's premier attractions.