Akash Sama­roo

Se­nior Re­porter

akash.sama­roo@cnc3.co.tt

Econ­o­mist Pro­fes­sor Roger Ho­sein be­lieves that while the pub­lic would be hap­py with Gov­ern­ment’s de­ci­sion to de­lay the im­ple­men­ta­tion of in­creased elec­tric­i­ty rates, this means the debt-rid­dled Trinidad and To­ba­go Elec­tric­i­ty Com­mis­sion’s (T&TEC) suf­fer­ing will be pro­longed.

Speak­ing with Guardian Me­dia on Sat­ur­day, Pub­lic Util­i­ties Min­is­ter Mar­vin Gon­za­les said the im­ple­men­ta­tion of the Reg­u­lat­ed In­dus­tries Com­mis­sion’s (RIC) rec­om­men­da­tions for in­creased rates was not some­thing that will progress dur­ing the course of this year.

Yes­ter­day, how­ev­er, Ho­sein said the pop­u­la­tion would be hap­py about this but it is still ig­nor­ing T&TEC’s plight.

“Most peo­ple would not pay at­ten­tion to the fact that T&TEC would prob­a­bly have to car­ry their sub­sidy fur­ther in­to the fu­ture, and about the vi­a­bil­i­ty and func­tion­ing of T&TEC as it per­tains to en­hanc­ing rev­enue in­flows in the con­text of no rate in­crease, peo­ple will not go that way or think in that di­rec­tion,” Ho­sein ex­plained, not­ing most cit­i­zens are too pre­oc­cu­pied with their own eco­nom­ic chal­lenges.

“Their salaries since 2014 in most cas­es have not in­creased and food prices in­creased very sharply since 2014, and they are now get­ting an ex­tra grace pe­ri­od with the elec­tric­i­ty rates un­changed in or­der to sur­vive.”

He said apart from this be­ing an elec­tion year Gov­ern­ment is al­so aware the econ­o­my is in a poor state.

How­ev­er, Ho­sein warned, “Some­body will have to pay for it be­cause this will have an ad­verse im­pact on T&TEC’s bot­tom line, so per­haps as soon as the elec­tion is done we will see the rate in­crease, as it is a nec­es­sary in­ter­ven­tion as ar­gued by the min­is­ter him­self in sev­er­al places.”

In No­vem­ber 2024, Gon­za­les told the Par­lia­ment that T&TEC owes the Na­tion­al Gas Com­pa­ny (NGC) around $6.16 bil­lion for the sup­ply of nat­ur­al gas.

Com­ment­ing fur­ther on the na­tion­al econ­o­my, Ho­sein re­vealed that the macro-eco­nom­ic vari­ables paint a wor­ry­ing pic­ture.

“We com­mon­ly hear about re­al GDP about 17 per cent less than in 2015. The labour force par­tic­i­pa­tion rate is the low­est since 2004. And I checked last night and be­lieve it or not, the stock of (for­eign ex­change) re­serves mi­nus ex­ter­nal debt for No­vem­ber 2024 is now neg­a­tive,” Ho­sein said.

Ho­sein said if this con­tin­ues, the coun­try may need to seek ex­ter­nal help to keep its util­i­ty com­pa­nies afloat.

“Mov­ing in­to the fu­ture though, we have no choice, we would have to cor­rect all these things and if it is the dif­fer­ence be­tween re­serves and debt con­tin­ues to be neg­a­tive, if growth con­tin­ues to be very poor, who knows, we may have to get sup­port from one of the mul­ti­lat­er­al lend­ing agen­cies in one form or the oth­er to im­ple­ment changes in the econ­o­my that will re­bal­ance the econ­o­my and help en­ti­ties like T&TEC op­er­ate at a more break-even lev­el in terms of rev­enues be­ing aligned clos­er to cost,” he ex­plained.

Speak­ing on Sat­ur­day at the PNM’s 69th-an­niver­sary cel­e­bra­tions, Trade Min­is­ter Paula Gopee-Scoon de­fend­ed the state of the econ­o­my, say­ing T&T is not in a bad place.

“This econ­o­my is not do­ing bad­ly. It is but­tressed and sup­port­ed by the non-en­er­gy sec­tor we need to do more but there is every hope that the en­er­gy sec­tor will re­bound through what is put in place by the En­er­gy Min­is­ter and the Prime Min­is­ter,” she told Guardian Me­dia.

Mean­while, po­lit­i­cal an­a­lyst Dr Bish­nu Ra­goonath is not buy­ing Min­is­ter Gon­za­les’ de­nial that the de­lay in the T&TEC rate in­crease is not due to this year’s gen­er­al elec­tions.

Gon­za­les on Sat­ur­day said, “The PNM does not run the coun­try by think­ing about elec­tions.”

How­ev­er, Dr Ra­goonath said yes­ter­day that the PNM is aware of the price it can pay at the polls.

“For all in­tents and pur­pos­es, the base of the par­ty is not nec­es­sar­i­ly the one per cent or up­per mid­dle class, the base of the PNM is re­al­ly the low­er-class peo­ple who would be called up­on to dig deep­er in­to their pock­ets to find mon­ey to pay for high­er elec­tric­i­ty rates should that have come. They’ve al­ready in­sist­ed last year that they col­lect­ed prop­er­ty tax­es, so clear­ly I don’t think the Gov­ern­ment is will­ing to run the risk of im­pos­ing yet an­oth­er in­crease on the al­ready bur­dened pop­u­la­tion, know­ing full well they are go­ing in­to an­oth­er elec­tion,” he ar­gued.

But he too warned that any gov­ern­ment com­ing in­to of­fice will have to se­ri­ous­ly con­sid­er how they are go­ing to con­tin­ue to fund not on­ly T&TEC but the Wa­ter and Sew­er­age Au­thor­i­ty (WASA).

“We re­al­ly have to wait and see what the man­i­festo promis­es would be from the var­i­ous po­lit­i­cal par­ties. But I could very well see re­gard­less of it is UNC or PNM, that they would have to take a very hard look at how they con­tin­ue to fund util­i­ty com­pa­nies in T&T to in­crease the abil­i­ty of those com­pa­nies to con­tin­ue to sur­vive,” Ra­goonath said.

Ra­goonath, how­ev­er, blamed the cur­rent Gov­ern­ment for its han­dling of this coun­try’s thrust to­wards re­new­able en­er­gy.

“So we have to stick with our cur­rent sources of en­er­gy, elec­tric­i­ty, and that comes at a sig­nif­i­cant cost. So, who­ev­er be­comes gov­ern­ment will have to deal with that,” he added.

Al­so com­ment­ing on Gon­za­les’ an­nounce­ment, UNC shad­ow pub­lic util­i­ties min­is­ter Bar­ry Padarath claimed the PNM is des­per­ate at the mo­ment and its “elec­tion han­dlers” had told the par­ty to hold off on that de­ci­sion.

Padarath be­lieves Gon­za­les must say more on why such a de­ci­sion was tak­en but went fur­ther in call­ing on the gov­ern­ment to scrap any in­crease to util­i­ty rates.

“I there­fore chal­lenge the Gov­ern­ment to say to the pop­u­la­tion that they will scrap in­tro­duc­ing any new wa­ter and elec­tric­i­ty rates over the pe­ri­od of the next five years should they re­turn to of­fice. The pop­u­la­tion must go in­to this elec­tion with their eyes wide open on this is­sue and the Gov­ern­ment must say very clear­ly what their po­si­tion is ahead of the gen­er­al elec­tion,” Padarath said.

In Oc­to­ber 2023, the RIC, af­ter months of pub­lic and pri­vate con­sul­ta­tions, pro­posed a res­i­den­tial in­crease rang­ing from 15 to 64 per cent, an in­crease for com­mer­cial cus­tomers from 37 to 51 per cent, in­dus­tri­al cus­tomers will see an in­crease be­tween 58 to 72 per cent, while an in­crease be­tween 199 to 126 per cent was sug­gest­ed for E class in­dus­tri­al cus­tomers.