March 21, 2014

Fiji Sun: Corrections Denies Assault on Dead Inmate

March 18, 2014

The Fiji Corrections Service has denied claims circulating on social media alleging that assaults by corrections officers led to the death of inmate, Viliame Tawake.

In an official statement issued yesterday the corrections service stated that Mr Tawake had suffered from a short illness.

“Mr Tawake was in fact taken to the hospital on February 28 after suffering a short illness. He was released from the hospital on Saturday morning (March 1).

“(On) Saturday evening; he was escorted back to the hospital and was released on Sunday morning (March 2) after he was treated by the medical authorities.

“On Sunday night, his illness recurred and became more severe and while arrangements were still being made for his transportation to the hospital, Mr Tawake passed away.”

Meanwhile, Mr Tawake’s family is disputing reports on social media that he had severe injuries.

Speaking to the Fiji Sun yesterday, Mr Tawake’s wife, Maria Makarita, said they only saw swelling and blisters on the right side of his face and that he had also bitten his tongue.

“Na ka ga au raica rawa ni vuce tu na matana, e katia tu na yamena, e vuce tu na yasa ni gusuna i matau. E vaka tale ga e kama tu qai tu e loma na wai,” Ms Makarita said.

She said the family could not determine reports on social media that Mr Tawake suffered severe injuries because they were only allowed to see his body from his neck upwards in order to identify him.

“Keitou a sega tale ga ni vakaisulutaka na yagona baleta ni a tukuna na nasi ni sa malumu na yagona. A sa mani olo tu ga ena isulu, na plastic kei na masi,” Ms Makarita said. (We didn’t dress his body at the hospital because the nurse informed us that his body had become soft. It was wrapped in cloth with plastic and a masi (tapa cloth).

Ms Makarita said what really upset her was the fact that the corrections service did not contact her to inform her that her husband had been ill and was taken to the hospital twice before his death.

“He died on Monday morning (March 3) and when the officers came to convey the news of his death they informed me that he had been ill and was taken to the hospital twice during the weekend. Why didn’t they call me when he had been taken to the hospital?”

Ms Makarita said the family was still awaiting the post mortem examination result.


Prof Wadan Narsey - Election Issues Bulletin 6: Gender, Sports, Indigenous Fijians in Business, Music, National Identity

A. Gender

It is an international cliche that women are not just a half of the population but a half of all voters, and potentially the most powerful voting block in any election.
Unfortunately for themselves, women rarely, if ever, vote as a block.
But what do the political parties have to offer women in real practical terms, that will make a difference to their lives, and decide which party they  vote for?
We can start with these elections and formation of Cabinet, but there are far more important issues relating to jobs, incomes, household work and leisure.
Women’s Representation in Parliament and Cabinet
One of the interesting aspect of the Bainimarama Government is that despite being totally in control of all appointments and not answerable to voters, Bainimarama had only 1 woman in his Cabinet (perhaps there were no Cabinet positions left for women, after 2 individuals decided to hog 10 cabinet positions between them).
While other elected governments may have been a bit better, none gave a fair go at having a good balance of women in their election line-ups or in their cabinets.
What will be the gender balance of all the political parties in the forthcoming elections?
Much will depend on whether the electoral system has a “Closed List” (in which case women can be properly represented at the top for each party) or an “Open List” in which case women will struggle as they always have.
Issue 1:  Voters can ask Commodore Bainamarama (and his Party when it eventually appears next month) why they rejected the Closed List system (if they do) that would have been extremely useful for women to be properly represented in Parliament
Issue 2: Representation in Parliament and Cabinet:  Voters must ask all political parties how they will ensure a fair balance of women (say more than 40%)
(a) in their elections line-ups
(b) in their Cabinet, should they form or be part of Government.

Women in Employment and Incomes
There are many studies of Fiji’s labour market that indicate that women are under-represented in both the private and public sectors at the higher levels, and, despite their  equal qualifications and experience, are on lower salaries than men. 
For example, this study of mine not only has data on incomes and employment but also unpaid household work.
There is also another Report which has been long been finalized but yet to be approved by Planning Office for publication by the Fiji Bureau of Statistics (Fiji Women and Men at Work and Leisure, Fiji Bureau of Statistics, 2014).
This report will not only have the latest data on employment (paid and unpaid) and incomes, but also interesting data on leisure activities such as sports, kava drinking, watching television and attending religious gatherings.
These studies show that some improvement for women are taking place in employment and incomes, especially for younger more educated women, but the changes are happening extremely slowly.
Issue 3: Gender equality in senior positions and incomes: Voters must ask the political parties what concrete measures they will take if they are  part of the next government,
(a) on gender equality in employment and incomes at the higher levels in the public service particularly, and board membership of government public enterprises.
(b) on gender equality in training for professional and technical programs where females are grossly under-represented         

The killer household work
Few understand that the total amount of unpaid household work (in hours), is roughly equal to the total amount (in hours) of paid work in Fiji (as it is internationally).
The two national studies (I have referred to above) have confirmed that there is gross gender imbalance in the unpaid household work (cooking, child care, clothes, cleaning, garden) done by working men and working women, and boys and girls.
In Fiji, working women do some 15 hours per week more than working men, while girls do some 4 hours per week more than boys.
There is very little improvement taking place in either gap.
This imbalance in household work reduces the time available to women and girls for professional development and leisure activities, such as sports.
Issue 4: Gender equality in unpaid household work
Voters must ask the political parties what policies they will put in place to encourage greater gender equality between men and women, and boys and girls, in the unpaid household work that is done throughout Fiji.

Leisure activities
The most recent data coming out from FBS surveys will indicate that women have available some 5 to 7 hours less per week in leisure activities than men, and girls have some 4 hours per week less than boys.
Males and females spend about the same time on religious gatherings and watching television.
But men spend far too much time (between 5 to 7 hours more on average) on kava gatherings and drinking, which time is not available for doing their proper share of household work.
Issue 5: To encourage a better sharing of household work, voters can ask political parties what will be their policies on encouraging men to reduce the time they spend at kava gatherings.

Women’s organisations
It has often been the case in Fiji’s history that women’s organizations have not only fought for specifically women’s issues and interests but also national issues and interests, which have required them, of necessity, to be critical of the government of the day.
Often, the government of the day (several governments) have ostracized those critical women’s organizations and disregarded their inputs into national and international policy making, while recognizing and supporting only those women’s organizations that pander to them.
In a truly democratic and free society, a responsible government would be inclusive of all organizations, and be principled and strong enough to accommodate robust debate and criticisms of governments and their policies.
Issue 6: Voters can ask all political parties whether
(a) they will  follow principles of inclusivity towards women’s organizations (such as Fiji Women’s Rights Movement, Fiji Women’s Crisis Center, Femlink, Soqosoqo Vakmarama,  etc) which may take principled stances which occasionally may disagree with government positions.
(b) they will give priority to women’s issues as articulated by their organizations, such as the prevention of violence against women.

BSports (including gender issues in sports)

The data from the latest Fiji Bureau of Statistics surveys will show that women and girls devote much less time (3 to 5 hours less per week) to sports than do men and boys.
This gap persists into middle ages and later, leading to poor health outcomes in females, and obesity in many.
Much of the problems begin at the secondary school ages, where the sports facilities and school for female sports, is nowhere as strong as are available for males sports such as rugby and soccer. 
These disparities continue into the national competitions and higher levels, where sports sponsorship (from both government and the private sector) for male-associated sports is far in excess for female associated sports such as netball.
Female sports often have to struggle to obtain funds to participate in international events, or even get local television coverage. Readers might look at this 2005 article.
Fiji’s exclusion from Super 15 rugby is also a sad opportunity gone missing not just for our rugby but also tourism. See here.
or here.
Issue 7: Voters can ask all political parties what will be their policies on
(a) Ensuring that there is equality of sports equipment, facilities and grounds, for girls as for boys throughout all the primary and secondary schools in Fiji.
(b) Ensuring that financial resources (from both government and the private sector) and made available for sports sponsorship for female sports,  matches that available for male-associated  sports
(c) Ensuring that all major sports (rugby, soccer, netball, athletics) receive adequate annual funding from government which forms an adequate base for them to build on.
(d) Female sports receive as much coverage in the media as male sports.
(e) Fighting through PACER Plus negotiations to get a Pacific rugby team (including Fiji, Samoa and Tonga) as part of the Super 15 competition.

C. Affirmative Action for Indigenous Fijians: in the business sector

In a previous Bulletin (Bulletin 3), I have pointed out that the UN Declaration on the Rights of Indigenous Peoples fully justifies the special treatment of indigenous peoples where they lag behind other ethnic groups, for systematic reasons.
In Bulletin 2, I gave the example of scholarships for education, where they needed special allocations to ensure that they were not marginalized from training necessary to reach proper  balance in the economy.
This balance for indigenous people is absolutely necessary in the business sector, where indigenous Fijians have a tiny share of corporate ownership.
It has been totally remiss of several largely Indo-Fijian dominated political parties to use Fijian Holdings Limited as a political football, in trying to tarnish the SVT or the SDL by alleging that they were only making elite or rich Fijians richer.
I argued here in this Statement for Mr Qarase in his recent trial that the only serious gap between indigenous Fijians and the other ethnic groups is at the top in the corporate sector, and it was necessary for Fiji’s economic development, that well-off or rich Fijians must be made richer.
Except in education, there is no need for affirmative action for the bottom 90% of the populations where Fijians and Indo-Fijians are pretty similar in terms of household income and expenditure.
But there must be Affirmative Action to foster indigenous Fijians in Business, just as other ethnic groups have received in Fiji’s history (read the article above).
Issue 8: Voters can ask political parties what will be their policies towards Affirmative Action to assist indigenous Fijians in business

D. Music and performing arts

Fiji multiracial communities are all characterized by their love of music and performing arts, which can be seen in the tremendous upsurge in singing competitions in the media.
Yet there is little financial support given by government or the private sector towards genuine growth in these musical and art activities, certainly nowhere near that given to sports.
The Fiji Performing Right Association Ltd, which is a strong force for trying to protect the royalty incomes of their members, needs far great support from government resources.
They also need new initiatives to strengthen the capacity of their members to grow their industry, and strengthen indigenous music and arts in Fiji, and music in all the vernaculars.
Issue 9: Voters can ask all political parties what will be their  policies to
 (a)  strengthen the local music industry, arts and cultures
 (b)  providing adequate resources to the Fiji Performing Right Association Ltd to better assist their members through their special projects aimed at schools and the general public.

E. National Identity and Inclusiveness

Since the 1987 coup, one of the most contentious issues which have impacted on public perceptions and attitudes towards the government of the day, those in authority, and political parties, is whether they foster a sense of “inclusivity”  amongst all ethnic groups.
Sadly, indigenous Fijian ethno-nationalists have tended to stigmatize Indo-Fijians (people of Indian origin), and to a lesser extent kaivalagi (of “European origin”) and kailoma (mixed European and local origins) as “vulagi” (“visitors”).
At the extremes, one politician (Butadroka) thrived by calling on Indo-Fijians to be repatriated to India.
One Cabinet Minister from the SDL Party not too long ago called Indo-Fijians “weeds” with no censure or apologies from the party leadership.
Such open racism has inevitably created a deep sense of “not belonging” and vulnerability amongst these Fiji citizens, and they flock to any Fijian leader who is inclusive towards them.
Indo-Fijians loved Dr Bavadra in the brief period he was allowed to lead Fiji.
Many will also remember that during the 1999 Elections, one Dr Baba (then part of the FLP) received adulatory rakhis during raksha bandhan,  from Indo-Fijian ladies (the rakhi is a colorful thread tied on the wrist to express the love of sisters for their protective brothers).
Historically, no Fijian leader has emphasized the principles of equality and inclusivity of all ethnic groups in Fiji, as much as Commodore Bainimarama.
In large measure, the support that Bainimarama gets from many Indo-Fijians (and also from many kailoma and kaivalagi) is due to this message of equality of all races, which he backs with the appointment of prominent Indo-Fijians, kavalagi and kailoma, to high places, to the removal or ethnic criteria in education, and to his  unfortunate dictatorial declaration that all Fiji citizens are to be called “Fijians” (which will no doubt be challenged in the next parliament).
But it is a wonder that other Fijian politicians do not emulate Bainimarama’s rhetoric and messages in this regard, given its importance in nation-building.  
On the contrary, one politician who tried to become the leader of SODELPA made the totally false and ridiculous allegation in an email that Mr Jai Ram Reddy (former leader of NFP) was collaborating with the FLP leader (Mr Chaudhry) to unite the “Indians”,  and he asked his own party “what are we Fijians doing”! One would have thought that political leaders would by now have stopped using divisive racial politics.
Note that treating all citizens as equals does not preclude Affirmative Action policies for indigenous Fijians where they systematically lag behind such as in education or business (while not discriminating against others’ legitimate  rights as citizens).
But note that non-indigenous Fijian votes, although only 35% of all votes, may well be critical in deciding which parties form government in the next parliament.
Issue 10: Voters can ask all political parties to specify what will be their policies towards non-indigenous ethnic communities in Fiji as full citizens to be accorded full respect and inclusivity in national life.

March 19, 2014

Prof Wadan Narsey - Election Issues Bulletin 5: Jobs, incomes, GDP and Public Debt

“It’s the economy, stupid” is the aphorism that is commonly used during elections the world over.

The most important issues for the average voter are his job (or unemployment) and his real income (i.e. how his family is coping with the cost of living).

Governments and competing political party manifestoes are judged first and foremost by these two criteria.

But we must also add the issue of Public Debt, which is the burden deliberately passed on to future generations by the current generations, usually through their elected governments.

Jobs, Incomes and Gross Domestic Product (GDP)
Both the growth of numbers of jobs and incomes depend on how well the Gross Domestic Product (or total income produced in the country) is doing.

Unfortunately for Fiji, following the December 2006 coup, the GDP growth rate was negative for two (or three) years out of the first five years.

Table 1 gives the sectoral behaviour of real GDP (using FBS data in 2005 prices).

Table 1 Gross Domestic Product by components Index Numbers (2006=100)

% Ch.


Agriculture, Forestry & Fishing


Electricity and Water



Hotel & Restaurants

Transport & Communication

Financial Services

Real Estate Business

Public Sector, Education Health

Other Services


Source: Based on GDP data of Fiji Bureau of Statistics (2005 constant prices) 
 Table 3: Public Debt
Public Debt ($million)
Number of Households (000)
Debt per household ($)
 Table 4: Debt:GDP ratio
Public Debt ($million)
GDP ($millions)
Debt:GDP ratio

100 is the 2006 base. An index number below 100 (in pink in the table) indicates that the GDP in that sector in that year was below that in 2006 (i.e. had gone backwards).

Note the many pink squares.

The numerous pink cells indicate how badly the Fiji economy did in these five years. The last column of Table shows that in 2011, the real productive sectors were worse off than in 2006.

Agriculture, for. and fishing down by -7% (sugar in serious decline)
Manufacturing down by -6%
Construction down by -12%
Wholesale, Retail etc down by -9%
Public Sector down by -8%
Other services down by -40%.

The only sectors doing well were Hotels and Restaurants (up by 67%).

And, for the wrong reasons (largely because of monopolistic pricing and profits)

Electricity and Water increased by a massive 105%
And Financial Services (banks, insurance companies) increased by 39%

overall, total GDP in Fiji in 2011, was a mere 1% more than that in 2006 - after five years, or the normal parliamentary life-time of a normal elected government.

One of the reasons why the sugar industry did not recover was that the EU withheld $300 million of assistance to the sugar industry when the Bainimarama Government failed to hold the elections in 2009. ($300 million is currently twice the annual earnings from sugar exports).

It is almost certain that should elections not be held in 2009, then the EU will re-impose all the sanctions they have been relaxing because of the promise of elections in September 2014.

Overall, it is no surprise that the 2010-11 Employment and Unemployment Survey (Report not published yet) reveals that wage employment between 2005 and 2011 declined by -3%.

Second, real income (i.e. adjusted for inflation) declined by an unprecedented 30%. (the exceptions were for the military, police and prisons).

The incidence of poverty during this period may have increased to above 45%.

Poverty would have been even higher, had it not been for large foreign remittances of around $300 millions (which is twice that of the sugar industry).

Table 2 gives the most recent estimates of growth rates of Fiji’s GDP since the 2006 coup (the figures for 2010 to 2014 have been recently revised by the FBS using 2008 prices).
Table 2 Estimated GDP Growth rates (2006 to 2014) (2008 prices)

There has been reasonable economic growth since 2010, but not enough.

Even taking the optimistic estimates from 2010 to 2014, the average growth rate between 2006 and 2014 under the Bainimarama Regime will be a mere 1.1% per year (see graph).

This is the worst record of any government since independence in 1970.

Under Ratu Mara it was 3.5% per annum (over 17 years)
Under Rabuka it was 2.0% per annum (over 11 years);
Under Chaudhry it was 8.8% (over 1 year)
Under Qarase it was 2.3% per annum (over 5 years).

Over the last 8 years, Fiji’s record is also the worst amongst the Melanesian countries.

This poor performance is hidden from the public view and mind because of the daily propaganda praising the Bainimarama Government in newspapers, radio, and television.

Excessive expenditure on infrastructure over just two years
It is clear that the economic growth of the last three years has been underpinned by a massive increase in public expenditure, and especially on infrastructure: an increase of one billion dollars spent over 2013 and 2014.

The Reserve Bank of Fiji in its latest report recognizes this by projecting that growth rate for 2015 and 2016 will be a lower 2.4% when the effects of the infrastructure investment wears off.

Note also that such a massive expenditure of $1 billion over a two year period is likely to lead to significant wastages by both FRA and the sub-contractors as they rush to spend the large allocations (one of the contractors in Vanua Levu has already declared packed up with tax-payers apparently bearing part of the cost).

Questions have been asked through the media who is auditing the FRA (and if FRA has been paying its top executives massive salaries in excess of $800 thousands). There have no been answers from the PS Finance.

Remember that PWD used to have a maximum annual investment of around $80 million and its top executives barely earned $100 thousands, for doing similar work?

Lack of private sector confidence
Fiji’s overall lack of growth has been due to the lack of private sector investment.

Total investment (both private and public) as a percentage of FDP should be around 25%.

Unfortunately it has been around 15% only, and most of that has been due to public sector investment by government and statutory corporations.

Why has Fiji’s growth record been so poor between 2007 and 2011?

Put simply, private sector confidence and investment have been undermined by the numerous decrees which stipulate that grievances cannot be taken to court.

Of course, there has also been the lack of political stability, the absence of an elected parliament, and too many ad hoc economic decisions being made by a few people in power.

We have seen this with respect to the pensioners’ legal case (which was already being heard by the courts), foreign investments at Momi appropriate, and the leases at Nadi Airport which were dissolved by decree (probably giving competing corporate interests more leased space).

It is accepted that there must be one law for the rich and the poor, and punishments have to act as deterrents so that criminals do not re-offend and potential criminals get the message. But, it cannot give private investors any confidence to invest in Fiji when one of the largest private investors and tax-payers in Fiji (and an elderly person moreover) is given a jail sentence, instead of a large fine which would have been more useful for the state coffers, and also served as a very effective deterrent to businessmen who feel hits to their pocket far more than free accommodation and food at Naboro.

Policy Issue 1:
Voters must ask all political parties whether they will guarantee to remove all decrees which stipulate that grievances may not be taken to court.

Policy Issue 2
Voters must ask all political parties what their policy will be on public investment on infrastructure

Public Sector Incomes
The Bainimarama Government for several years after 2006, refused to give any significant upward adjustment to public sector incomes.

Only in this last budget, and just 9 months before the elections, they granted an extremely large 20% increase to public servants.

They also granted, supposedly on the recommendations of an accounting company, outrageous large increases to $221 thousands per year, for select Permanent Secretaries.

Ministers’ salaries have not been declared since 2007, with some believed to be paid through a private accounting company.

Most outrageously, the Public Accounts Committee has been sacked “to prepare for the next parliament”.

Was the PAC beginning to query the payment of ministers’ salaries through a private accounting company?

Policy Issue 3
Voters must ask all political parties what their policy will be on public sector salaries, including that of Ministers, Permanent Secretaries, and ordinary civil servants.

Policy Issue 4
Voters must ask all political parties what their policy will be on the independence of the Public Accounts Committee, and the need for Auditor General Reports to be compulsorily and annually made public.

Wages Councils undermined for the poorest workers
The poorest workers are those not represented by unions, and who are mostly paid wages well below the Basic Needs Poverty Line and who are supposed to be protected by the ten Wages Councils.

These were formerly under the Chairmanship of Father Kevin Barr, trying to adjust minimum wages sector by sector, depending on how well each sector was doing.

But Father Barr’s Wages Regulation Orders, different for the different sector, were postponed year after year by the Minister, because of unethical pressures by employers and the Employers’ Federation, with not a single employer showing their audited accounts to the Wages Council Chairman (Barr) or the Labour Minister (as required).

Eventually only partial adjustments were allowed, which did not keep pace with the large increases in the cost of living. Most of these workers fell further into poverty, because Government essentially capitulated to employers.

Finally Father Barr accused the Bainimarama Government of practicing “crony capitalism”. Over a minor irrelevant remark, he was later abused on the phone and threatened with non-renewal of work permit and eventually sacked as Chairman of Wages Council.

For five years, the employers’ interests were far more important to Government than these poorest workers in the country, who number around 50 thousand, potentially yet another large voting block in the next election.

Policy Issue 5
Voters must ask all political parties what their policy will be the independence of Wages Councils, and the implementation of their Wages Regulation Orders.

National Minimum Wages
In 2013, with much fanfare, the Chairman of the Commerce Commission of Fiji (Dr Mahendra Reddy), issued a National Minimum Wage of $2.32 an hour, supposedly after an objective and scientific study

He rejected alternative arguments coming from me (at a debate at FNU attended by the Minister and PS of Labour) that some employers and industries might not be able to pay even that minimum wage (and enforcing a high minimum wage would mean that workers would simply lose their jobs), while others who could afford to pay more, would refuse to do so by pointing to the lower National Minimum Wage.

In any case, in the last month, the Minister of Labour (apparently again under pressure from the Employers’ Federation, unilaterally reduced he National Minimum Wage to an even lower $2 per hour (with no comment from Dr Mahendra Reddy to enlighten the hordes of FNU students who had gathered at FNU to vote for him after the debate).

Policy Issue 6
Voters must ask all political parties what their policy will be the National Minimum Wage.

Regressive taxation measures
Since the Bainimarama Regime took control at the end of 2006, they have changed the taxation system heavily in favour of the rich and wealthy.

While they keep claiming (quite falsely) that the poor now do not pay any tax because the income tax threshold had been raised to $15 thousand dollars per year, the reality has been that all pay tax through VAT on many of their essential expenditures.

(a) VAT, which affects the poor people far more seriously than the rich, has been increased from 12% to 15%.

(b) Income tax at the highest income levels has been reduced totally unnecessarily from 30% marginal tax to 20%, lower even than all our neighboring countries.

(c) Corporate tax has also been reduced totally unnecessarily from 30% to 20% (and for companies listed on the Stock Exchange even lower to 17%) lower than all our neighboring countries.

All these taxation changes have helped the rich, while hurting the poor.

The Bainimarama Regime has significantly worsened income distribution.

On the positive side, the Bainimarama Regime has in the last budget, brought in comprehensive subsidies in education, which mean that primary, and secondary education will not be a financial burden on poor families. Moreover, all students who get accepted at tertiary institutions will be able to access either full scholarships or loans. IN the last few days, pre-school has also been supposedly made free.

These education policies by the Bainimarama Government counter, to some extent, the changes in taxation policy, for those families with children at school, but not for others.

The building of rural roads should also be of great assistance to the rural poor, facilitating the marketing of their produce and better access to essential urban services.

For those being access to better roads, these progressive expenditures of taxpayers’ money also counters the income distribution effects of negative changes in taxation.

However, good transparent public policy requires that income redistribution measures (such as through progressive taxation) must be followed independently of good measures in public expenditure, simply because the beneficiaries of the two are not the same groups.

Policy Issues 7: Voters must ask all political parties what their policies will be on
(a) VAT
(b) income tax at the higher levels
(c) corporate tax

Remittance incomes
Fiji’s remittance incomes originate with those working abroad (caregivers, security guards, army personnel in the British Army and elsewhere), and emigrants sending money home to their families.

Considerably more Remittance Money may be generated if trade agreements with Australia, NZ and other developed countries could be signed so as to include the mobility of unskilled labour, whether as part of the Seasonal Worker Scheme or others to be negotiated.

Labour mobility as part of aid scheme will not have the same security as such benefits may be withdrawn if, as during election times in those countries, there is pressure from labour unions there.

This issue will be discussed more in a later Election Issues Bulletin on regional and international relations.

Policy Issue 8:
Voters must ask all political parties what their policies will be on Trade Agreements with Australia and NZ, and access to their labour markets for Fiji’s unskilled labour.

Public Debt: unfair burdens for the future generations
All governments borrow money in order to pay for infrastructure, whose cost the future generations need to share with the current generations.

The real issue is: what should be the balance between the current generation and the future generation.

If excessive amounts are spent today to enable the current generation to enjoy the benefits of the current increases in recurrent and capital expenditure spending, then the future generations will be forced to unfairly shoulder a considerably higher Public Debt per household.

Remember that in every budget, Debt Repayments (Principal and Interest) is paid a a FIRST CHARGE out of Government Revenue (and always shown on the first page of the detailed budget estimate documents).

This Public Debt MUST be paid by future generations by combination of higher taxation, reduced public services (like education or health or social welfare), constraints on public sector salaries, and reduced recurrent and capital expenditure.

In the worst case secenario, irresponsible governments who insist on “living beyond their means” today, try to borrow more and more in the future, increasing Public Debt until it becomes totally unmanageable for the future generation. (this is what some of the nations in Europe were doing until they crashed recently, requiring a massive bailout from the European Union).

In the absence of Reports of the Auditor General since 2006, there is no guarantee that the figures quoted in the Annual Budgets on Public Debt are correct: Public Debt figures may well be higher than reported.

According to the unaudited Budget figures, the Bainimarama Government has increased the Public Debt quite significantly from the $2.8 billion in 1006 to about $4 billion in 2014.

But the Bainimarama Government’s 2014 budget also stated that they will limit current borrowing, by raising some $450 million through sales of government assets.

[This is equivalent to a farm showing lower deficits today, by selling the farm assets, including the cash cows, to generate revenues].

If the planned asset sales of around $450 million are excluded (as they properly should), Government would have had to borrow $450 million more to finance their planned expenditure.

The Public Debt would increase correspondingly to around $4.5 billion (in red, under 2014* in Table 3).

In practical terms, what this means is that the Bainimarama Government, without the permission of taxpayers through an elected parliament, has increased the Public Debt per household from about

$17 thousand in 2006 to
$21 thousand in 2014 (an increase of 24% per household (official figures)

and to more than

$23 thousands (an increase of 38%) if we exclude the planned asset sales.

Given that most of the poorer households in Fiji have not seen any significant increase in money incomes during this period, the 38% higher Public Debt per household must constitute a considerably higher burden on most households, compared to that in 2006.

Future pressures on tax-payers and households will be even more intense if the economy fails to grow after 2014, for whatever reason (e.g. elections being cancelled or postponed, or if the Fiji Military Forces do not abide by the election results).

An alternative way of looking at Public Debt in in relation to GDP. Table 4 indicates that the Debt:GDP ratio will not have gone down from 53.3% to 48.3% in 2014 (as officially claimed), but increased slightly to 53.7% (if we leave out revenues from asset sales).

Policy Issue 9:
Voters must ask all political parties what their policies will be on Public Debt, Annual Government Deficits, and Asset Sales.

No New Industries of Scale
One of the major failures of the Bainimarama Government has been their inability to come up with any ideas whatsoever to generate major new industries.
Three areas which have gone begging have been:

(a) Retirement homes and villages in Fiji: tardiness in setting up ancillary medical services and other input services (possible employment of 20,000 within five years)

(b) Call-centre and data-processing industries: inability of Commerce Commission to reduce call charges (possible employment of 20,000 within five years)

(c) Value adding industries based on mahogany harvests: massive contracts given out to preferred corporate clients, for export of essentially unprocessed timber, while domestic timber processers are denied supplies. (possible employment of 5,000 within five years)

Policy Issue 10:
Voters must ask all political parties to explain their detailed economic growth and development strategies.

Summary of Recommendations on Policy Issues in this Bulletin

Policy Issue 1:
Voters must ask all political parties whether they will guarantee to remove all decrees which stipulate that grievances may not be taken to court.

Policy Issue 2:
Voters must ask all political parties what their policy will be on public investment on infrastructure

Policy Issue 3:
Voters must ask all political parties what their policy will be on
(a) public sector salaries,
(b) that of Ministers and Permanent Secretaries.

Policy Issue 4:
Voters must ask all political parties what their policy will be on
(a) the independence of the Public Accounts Committee, and
(b) the need for Auditor General Reports to be compulsorily and annually made public.

Policy Issue 5:
Voters must ask all political parties what their policy will be
(a) the independence of Wages Councils, and
(b) the implementation of their Wages Regulation Orders.

Policy Issue 6:
Voters must ask all political parties what their policy will be the National Minimum Wage.

Policy Issues 7:  Voters must ask all political parties what their policies will be on
(a) VAT
(b) income tax at the higher levels
(c) corporate tax

Policy Issue 8:
Voters must ask all political parties what their policies will be on Trade Agreements with Australia and NZ, and access to their labour markets for Fiji’s unskilled labour.

Policy Issue 9: Voters must ask all political parties what their policies will be on
(a) Public Debt,
(b) Annual Government Deficits, and
(c) Asset Sales.

Policy Issue 10:
Voters must ask all political parties to explain their detailed economic growth and development strategies.