Opposition Leader Philip J Pierre defines an Economic Stimulus to Combat COVID-19, health, social and economic crisis in Saint Lucia, delivered March 29, 2020.
The total cost of the stimulus package is XCD$250.5 million.
By Philip J Pierre
[Tonight] is the third time that I am addressing you in less than two weeks. This is extraordinary but we are living in extraordinary times that have been generated by an extraordinary coronavirus COIVD-19 pandemic.
As we have been witnessing, this pandemic is ravaging the globe – developed and underdeveloped countries, First World and the Third World States, continental military powers and no powers island states – all lie stricken in its path. All over the world governments and legislatures are taking extraordinary actions to combat it.
Our world is in crisis and at the very least can be likened to World War II or the financial crisis of 2008. Governments and international institutions in both cases were required to respond, albeit in different ways, to these crises to return the world economy to normality. Immediately after WWII, governments responded by adopting heavy deficit spending to rebuild damaged infrastructure and getting people back to work.
And in the case of the financial crisis, governments and central banks around the world were bailing out financial institutions and providing financial capital to shore up the banking system. In the case of COVID-19, government interventions are required again, but this time it is to ensure citizens are protected and able to sustain themselves. While social distancing, good personal hygiene, and testing are all necessary to reduce the spread of COVID-19, displaced workers, who will be unable to work for a while, need money in their pockets to feed their families.
We must do all we can to avoid panic and social disorder. And of course, our health facilities need to be dramatically improved to look after those infected and requiring health care.
Appreciation and solidarity
Let me thank our health and medical professionals who have been giving so much of themselves for us already on the front line in fighting this disease. We are heartened that the government has at last been made to move patients from Victoria Hospital to the Owen King European Union (OKEU) hospital which the Saint Lucia Labour Party (SLP) completed five years ago. You and the citizens of this country deserved no less.
My appreciation also extends to the personnel of the St Lucia Fire Service and The Royal St Lucia Police Force who are also on the front lines in this theatre of the world war against COVID-19.
I want to thank the government and people of Cuba for once more coming to our assistance in our time of need with the dispatch of 128 medical professionals to assist us at this critical time. Our relations with Cuba have been long-standing and deep and Cuba has never failed to answer our calls. We speak of extraordinary times but Cuba is an extraordinary country. The SLP pledges its unwavering support to the government and people of Cuba in their struggle against the unjust economic sanctions to which they have been subjected.
I take this opportunity also to thank the government and People of The Republic of China-Taiwan for their contributions to our battle against the disease. Taiwan has always been a steadfast friend to Saint Lucia and also deserves our gratitude.
We are concerned that the government, appears to be ignoring some of the very guidelines that it has called upon the public to observe in relation to COVID-19. The government has asked our people to observe social distancing in line with the advice of the health authorities and so it has closed down all non-essential services in the country. So why is the government undertaking new projects in some communities like the construction of new roads and buildings and work on some playing fields? Are these activities absolutely essential at this time?
On Wednesday, March 25, director-general of the World Health Organisation (WHO) Dr Tedros Adhanom Ghebreyesus in an address to member states on the policies they should be taking to combat COVID-19, recommended six actions, the sixth of which was: “ Refocus the whole of government on suppressing and controlling COVID-19.” The prime minister has told us before, that on COVID-19, he is following the advice of the WHO, The Pan American Health Organization (PAHO) and other regional organizations. I, therefore, commend this recommendation to this government.
We are cooperating in trying to stem the onslaught of COVID-19 on the health of our people, but it has already devastated our economy. Our tourism industry, the economic backbone has been shut down; thousands of our citizens have lost their jobs and small businesses and the self-employed are adrift. We as a country must, therefore, deal with the implications of this economic shock whilst simultaneously counter-attacking the virus on the health front.
In my previous addresses, I called upon the government to introduce measures to overcome the economic fallout of COVID-19; particularly in relation to workers who are now unemployed. In the spirit of continued cooperation and national unity against COVID-19, the Saint Lucia Labour Party is proposing the following initiatives to assist in cushioning the devastating economic impact of the virus. I have sent the proposals to the prime minister for the consideration of his government and I now wish to share them with you.
Health services – XCD$45 million
We estimate that over the next three months resources will be required to handle the actions required to fight COVID 19 directly. These include steps to expand and increase testing, community tracing, quarantine, and isolation when deemed necessary, education and information dissemination, hygiene and sanitation, costs of additional staffing as well as costs related to commissioning the OKEU Hospital.
We also propose the following measures that will form the basis of an economic stimulus aimed at providing relief to the thousands of anxious Saint Lucians. The package is designed for an initial three month period but the situation is dynamic and will require monthly monitoring and or adjustment.
The Economic Survival and Support programmes that we propose for implementation for the next three months are:
- Direct Income Support;
- Fuel Support;
- Agricultural and Food Support;
- Domestic Utilities & Rental Support;
- Short Term Employment;
- Small and Medium Enterprise Support;
- Travel and Tourism Support.
Those broad programmes are further broken down into sub-programmes, to cover those critical areas, as I shall explain.
- Direct Income Support
This programme calls for government intervention to provide direct income support to all sectors which have been impacted by layoffs and inactivity. A monthly cash stipend maximum of $1,000 should be paid to all qualified persons whose regular income has been cut-off or substantially reduced. We believe that over 40,000 people can benefit from this measure.
1) Pay-roll, hotel and restaurant employees, self-employed vendors, taxi drivers, tour guides active National Insurance Corporation (NIC) contributors and others falling in that pool will qualify for assistance. Working through the NIC, employers, taxi and vendors associations, Village Councils, hotels, eligible citizens can be identified for this assistance. (XCD$129 million)
2) There should be an increase in public and social assistance. Additional assistance should be provided to needy persons and those who are presently on the government’s assistance and persons with disabilities because of the extra difficult circumstances they will face during this period. Any other assistance that they might have been receiving from family members will be scare during this period. (XCD$2.6 million)
3) Food vouchers through the Saint Lucia Social Development Fund (SSDF) should be distributed to deserving families based on the population of the 17 constituencies. (XCD$5 million)
4) Starting from April, a monthly bonus should be paid to the front line health workers, including nurses, doctors, and first respondents for their extraordinary efforts in the fight to contain this coronavirus and protect the population. (XCD$1.2 million)
- Fuel Support
This support would provide direct subsidy on fuel purchase for high consumers of fuel namely, fisher folks and public transport operators.
1) Fishing boat operators, especially registered fisher folks would need fuel subsidy in order to remain in business to supply much-needed protein to our people without the need to increase fish prices. A fuel voucher should be introduced as a direct subsidy to that industry. The voucher can be the equivalent of the excise tax amount of $4.00 per gallon of gasoline. The value would be based on the monthly consumption rate of the fishers. This measure could be easily implemented through the various fisherfolk co-operatives islandwide and would greatly assist in our food security.(XCD $2.2 million)
2) Mini-bus operators should be provided with direct fuel subsidy through a similar fuel voucher mechanism to enable that sector to remain viable, providing an essential service to the country under very difficult circumstances. The imposition of social distancing on public transport has affected those operators financially and every effort must be made by the government to support this sector directly. (XCD$3.6 million)
- Agricultural and Food Support
- We propose income support for the farmers who have not been paid by NFA for produce sold to Winfresh. (XCD $2.5 million)
- Income support for the farmers who sell directly to the hotels and restaurants who will no longer be receiving any income. (XCD$3 million)
- To enhance our food security we recommend that inputs of seeds, fertilizers, and other planting material together with irrigation support be provided to our farmers. (XCD$3.6 million)
- Domestic Utilities and Rental Support
- Saint Lucia Electricity Services (LUCELEC) should be asked to cover for the next three months, the first 180kWh for households that require relief. This would result in a savings of $135 on the electric bill of approximately 30,000 households. There should be no disconnection during that period.( XCD$12.1 million)
- Water and Sewage Company (WASCO) should be asked to cover the next three months, the first 3,000 gallons of water consumed for households that require relief. This would result in a savings of $25 for approximately 30,000 households. There should be no disconnection during that period. (XCD$2.2 million)
- Landlords must be encouraged not to evict tenants and consider reduced, part or a suspension of payments taking into account that there may be a moratorium on mortgage payments.
- Short Term Employment
We need some critical sectors of society to provide necessary services while observing the necessary protocols of social distancing to work.
- A Farm/Fisheries Labour Support Programme can create jobs and assist in boosting our primary production. (XCD$1.5 million)
- An expansion of the Home Help Programme can assist over 300 seniors and persons with disabilities. (XCD$1milllion)
- A national landscape & beautification programme can enhance our roadways, parks, trails, historic sites and attractions (STEP). (XCD$3M).
- Small and Micro Enterprise Support
Our small and micro enterprises are already suffering from the loss of income. There are many small businesses, some of whom employ just one or two other persons, some many more. They will require assistance to survive this period. We propose a small business grant facility to aid up to over 1,000 Small and Micro Enterprises. A grant of $5,000 monthly is proposed. (XCD$15 million)
The arts, entertainment and media sector which we have often termed as the Creative Industries will require special attention. Artists, performers, DJs, musicians, graphic designers, entertainers, media and producers are most particularly affected.
The artists and media houses can be persuaded to produce useful programmes to raise the national spirit. (XCD$3 million)
- Travel and Tourism Support
A short term grant to small hotels and guest houses, Airbnb operators and other operators who are not captured in the income support programme. (XCD$15 million)
The total cost of the stimulus package is XCD$250.5 million
The Public Services
Salaries for civil and public servants in the initial three month period should be financed by the issuance of new public debt or existing surpluses. We expect that international financial institutions will support this venture. Banks will be expected to support this undertaking with rollover and fully subscribing to the newly issued debt. It must never be forgotten that we are living in extraordinary times and extraordinary measures are needed to protect the lives of our people since there can be no economy without people.
We propose that the government should offer companies who retain and continue to compensate staff a tax credit of 150 percent of the total paid to the employees.
- Waiver of income tax installments due for the year 2020;
- Payment of tax refunds of less than $2000 due to taxpayers;
- The moratorium of loan and mortgage payments do not attract increased interest or late payment fees.
We have been visited by an invisible enemy that threatens our livelihoods and sadly the lives of many. Our priorities must, therefore, necessarily be revisited in response to the threat of COVID-19. We must act decisively, and adopt policy responses that are efficient and effective.
Many of our citizens have already lost their jobs, and more will be in the coming days and weeks, and their ability to look after themselves and their families. A caring government has a civic and moral responsibility to help these people now. It is not enough to, only, extend our concern; these displaced workers have human needs just like us, and so we must help them, from whatever resources we may have as a country.
The government’s priorities pre-COVID-19 cannot be the same as post-COVID-19.
As I said at the commencement of my address, this is an extraordinary time and it demands extraordinary action to save ourselves and our country. This is why we have presented these recommendations for an economic stimulus package. We must be extraordinarily disciplined in our response to this pandemic, it means strictly and rigidly following the instructions given by the health authorities and adhering to the regulations set by the government to combat the disease.
Frequently wash our hands, maintain social distancing, and stay at home.
The next few weeks will be the most challenging. We must be prepared for even more extraordinary action and discipline on our part if the virus becomes more severe here. We must not panic; panic will only worsen the situation but with a resolute and united purpose and the Grace of God, we can and will overcome this together.