The government of Saint Lucia has said that while it continues to cushion the impact of rising global oil prices, subsidies to citizens represent an estimated shortfall of EC$2.9 million ( one EC dollar = 0.37 US cents).
The Phillip J. Pierre government announcement follows a broadcast earlier this week in which Opposition Leader Allen Chastanet called the government’s economic policies “heartless.”
“It’s also clear that this is an administration that doesn’t understand our economy. When you pass the costs on to our citizens and businesses at a time when the economy is still recovering, what is the expected outcome? When you raise gas prices, who do you think it will affect?” Chastanet asked, adding that the country’s economy has improved to pre-coronavirus (COVID-19) conditions.
“While it is clearly within the purview of any government to change policy, at least change it for the better, instead this heartless administration is wreaking havoc on households and the business community,” he said. he added.
In its statement, the government said that despite the 8.5% inflation rate, the highest in 40 years, experienced by the United States, the island’s largest trading partner, the COVID-19 pandemic 19 and the Ukraine/Russia conflict, the government continues to cushion the impact of rising global oil prices.
He said fuel prices were adjusted on May 2 for three weeks ending May 22.
“Subsidies on 20-pound and 22-pound petrol bottles are subsidized by EC$25.30 and EC$27.83, respectively. These subsidies represent an estimated EC$2.9 million shortfall in government revenue.
“Similarly, the government continues to provide gasoline and diesel subsidies where it collects $0.00 in gasoline excise tax.”
The statement quoted Prime Minister Pierre as reminding the public that “the shortfalls will have a serious impact on the government’s already strained cash flow and its ability to meet critical expenditure in areas such as health, education, social assistance, wages and salaries and debt. Payments.
“Gasoline and diesel excise tax collections are needed to fund government operations, including the provision of supplies to hospitals and health facilities, the management of COVID-19 and the provision of equipment and school supplies.”
But the government said that despite the challenges, its “comprehensive and people-centred budget for 2022/23 should mitigate the impact of the ongoing COVID-19 pandemic, the Ukraine-Russia conflict and its effect on rising inflation and world oil prices”. ”.