import levy cuts: conclusion


Government must stop introducing last-minute policy, or pushing it through without proper consultation.

Significantly reducing state revenue at the behest of foreign economic ideologies and powerful importers with uncertain levels of influence over politicians is no way to improve public confidence.

MFEM acknowledges cutting import levies results in lower revenues and also admits that:

“It will be a major challenge to limit overall government expenditure while increasing expenditure on core government services. There is considerable evidence that the education and health sectors are key drivers of economic and human development, and a strong case can be made for increasing funding. Issues relating in part to funding in these areas have recently attracted significant public comment.” (Half year financial update 2005-06)

Emphasis added. In seeking to cut import levies without subjecting such a policy to good governance and proper due process including consultation, transparency and accountability, government risks sacrificing human development in favour of a small percentage who benefit most from economic development.

Nor is it enough for government to cut $6-10 million in public monies using a much-overlooked supplementary budget. Or with a few lines of scattered commentary in a narrowly circulated half year update and expect informed public debate. Then write one newspaper article and slap in a few ads two months later and expect learned public submissions within two weeks.

Such tactics could well prompt yet another crisis of confidence in government over its perceived arrogance, lack of responsiveness to public concerns and bulldozer tactics when it comes to favoured policy.

Or it could be an opportunity.

Government could reengage with the public through a series of robust measures along the lines of those suggested above.

whole submission