Tuesday, May 19, 2009Thompson Pushing Job Security

Jewel BrathwaiteEmployment Stabilisation Package Takes Centre Stage In 2009 Budget Presentation

AN innovative scheme to safeguard the jobs of thousands of Barbadians threatened by the ongoing financial crisis was the centrepiece of Prime Minister David Thompson’s second Financial Statement (Budget) presented yesterday.

In the $3 Billion Budget, made against the background of a worsening global economy and a slowdown in Barbados’ economic fortunes, Mr. Thompson said this Innovative Employment Stabilisation Scheme is expected to cost the Unemployment Fund $34 million over six years.

Added to this initiative are plans to intensify the Government’s Housing programme; a waiver on interest and penalties in respect of land taxes, income taxes, VAT and National Insurance; a $15 million window to speed up payments to small businesses who complete Government projects; VAT relief to homeowners; and concessions to new car dealers, completing the Budget package presented in just over two hours.

Additionally, water rates are to go up by July, new legislation is coming for the International Busi-ness sector and the creative economy, and there will be a lowering of the cost of drivers’ licenses for seniors.
However, it was the Employment Stabilisation package that took centre stage.

NIS loan

According to the Prime Minister, “I have agreed to make available to eligible employers experiencing cash flow problems, the equivalent of a loan from the National Insurance Scheme which is one year’s deferment of employment contribution to the scheme.”

Noting that employers must however have been compliant as at June 30, 2009, he said they have to give a commitment to maintain current employment levels for the period of the facility.

The arrangement is to become effective July 1, 2009 and the amount of the loan will be repayable over a five year term at a three per cent rate of interest.

He stated that the facility will not put the NIS in a worse position. Legislation will be passed to enable the Unemployment Fund to pay over to the National Insurance Fund the difference between what the NIS would otherwise have earned as these employer contributions and what the NIS actually earns on the scheme.

Mutual benefits

To thunderous applause from the Government benches, the Prime Minister said too that employees will benefit since they maintain all of their employment rights and their jobs and that their income does not decline. Similarly, employers benefit because their cash flow requirements should be eased and they can maintain their commitments to the Social partnership.

“The economy and the whole society benefits because job levels are maintained,” he said “I have specifically placed jobs under this heading because we recognise that the protection of jobs is not only an economic initiative, but in times of economic challenges, it is a social issue,” the Prime Minister declared.

“Our Social Partnership programme to save jobs is the key initiative in this Financial Statement,” Mr. Thompson said.

The Prime Minister said as well that as a consequence of the current economic crisis, Government has already introduced a programme of relief to employers and self-employed persons by way of a waiver of interest and penalties in respect of outstanding National Insurance, Income Tax, Land Tax and VAT.

He also outlined a number of new areas for Government’s housing programme.

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