Former PM, Owen Arthur, says Barbados central bank governor should be dismissed

Former prime minister Owen Arthur has called for the dismissal of the Central Bank Governor Dr DeLisle Worrell, accusing him of making “irresponsible and cavalier” statements in relation to the Value added Tax (VAT) system.  “Barbados is facing an apocalypse and Dr Worrell is now the chief horseman of our apocalypse,” Arthur told the Barbados TODAY website after the Central bank Governor told a news conference earlier this week that the VAT, which has been in force here since 1997 was both unnecessary and unsuitable for  the island.

Worrell said the VAT had “absolutely no advantages” for Barbados, describing it as a “mess” and “a complicated tax to operate”.  Arthur, who was head of government when the tax measure was implemented, said, “The VAT debate is being introduced as a distraction from what should be facing us at this time… and what is necessary to stabilize and to save our economy and the society.”

He recalled that the late prime minister David Thompson had in 1994 indicated his intention to introduce a VAT from January 1, 1995.  “I supported a value added tax in Opposition and looked forward on becoming the Head of Government in 1994 to introduce it, but I was advised that the then Deputy Governor Dr Worrell opposed it,” Arthur recalled.

According to Arthur, who is also an economist, “I asked him (Dr Worrell) to document for me his reasons, and he did send me a letter on it, and I must tell you, there were two consequences: one is that the reasoning was so vapid that I knew then that I would never be able to appoint Dr Worrell as a Governor of the Central Bank.”

The former Prime Minister continued, “. . . And, secondly, every time I wanted to find something to laugh at, I took out Dr Worrell’s letter to read it because he was effectively advising that we should have taken the 11 pre-existing bits of taxes and reform them, rather than introduce the Value Added Tax, so that this is not new territory for Dr Worrell.  This is a longstanding fascination that really does not draw upon any particular empirical, or theoretical, or conceptual foundation.”

Arthur said that contrary to the Governor’s stated position, the VAT had been “the tax of choice” and “it has more than performed the purposes for which it is intended in Barbados”.  He also stated, “If this was Dr Worrell’s only indiscretion, I think we could dismiss it.  But how long are we going to dismiss the series of indiscretions that this man has been perpetrating?”

Arthur said that Barbados had reached a stage where it could no longer dissociate an aspect of the “very horrible circumstances” it faced economically from the nature of the advice that Worrell had been advancing.  He stated, “It seems as though he (the Governor) prides himself on the extent to which  he is unorthodox as happened for example in his altercation with the managing director of the International Monetary Fund.”

Arthur said his advice to the Freundel Stuart government is to ignore Worrell “and I hope the Government of the Bahamas (to whom Worrell has offered similar advice on the VAT) will ignore him and really let us focus on that on which we are focusing.  Finally, Arthur advised, “What I thought he would have been telling us is how he got the Central Bank of Barbados into this now paltry state where it is now losing money, even while printing money and he is sending home 60 workers. …I thought the (Central Bank) board would tell Dr Worrell he needs to send home one person. And that one would be Dr Worrell.”

Source: Caribbean360