Fellow citizens and residents, we join many other nations around the world in celebrating our workers as we observe Labour Day 2022. This is no ordinary Labour Day. It marks just over two years since the COVID-19 pandemic has spread around the world and threatened to overwhelm everyone. Yet thanks to our workers, citizens, and residents in general, we are gradually turning the corner and looking ahead to our lives and livelihoods getting back on track. I record our enduring gratitude to all our front-line workers including our health and security workforce for the success in the implementation of our life first strategy which has served our Nation well.
We responded quickly and decisively to the multifaceted and complex negative effects of the pandemic, mitigating as far as possible the virus’ damage to our people and economy through the implementation of a substantial stimulus package. Thankfully, today, there are promising signs of economic recovery. Our economy is expected to grow by around 10 percent this year. And while the situation is improving, we refuse to be complacent or to turn a blind eye to those who may be struggling. We reaffirm once again our absolute commitment to continue supporting our neediest citizens and residents with effective and flexible financial support.
We are also on a clear pathway to strengthening our economic resilience within the context of the pandemic and other global risks such as the Russian invasion of Ukraine with the attendant high costs of fuel and agricultural inputs. We have underscored our commitment to shape and create the enabling environment to support economic recovery and development for the benefit of our workers and by extension every citizen and resident. In this regard, we are working on a new Economic Recovery and Growth Strategy.
As we demonstrate our respect for workers this Labour Day, several reflections come to mind including the hard-won gains of the labour movement here in our Federation. One conclusion I have reached is that solidarity with, and among, workers must be reinforced and protected. That solidarity is the glue that will continue to bind us together as a resilient Nation, recognizing our common destiny and realizing our shared prosperity. It is our care and solidarity with workers that motivated the Government to utilize the fiscal buffers that were carefully saved prior to the pandemic as a result of my prudent management of the public finances. The assistance that has been provided by the Government is second to none across the Region. So far, our people-centric and worker-centric policies and programmes have provided access to critical resources when they were needed most. The Ministry of Finance has confirmed that, to date, the Government has spent over $11.0 million via the stimulus flagship programmes (Income Support came to $9.96 million, the Fuel Subsidy to $377,500 and Disability Support was $722,000). It is no secret that the Severance Payment Fund has operated with a negative balance for several years. Nevertheless, your government honoured the obligations of the Severance Fund to workers by investing $43.9 million to ensure that our workers were not placed at any further disadvantage. These payments provided critical support to 2,641 workers: 1,832 workers on St. Kitts and 809 workers on Nevis. The burden of this unprecedented $43.9 million was carried by the Federal Government.
As we look to the future, I remain positive that the policy decisions of this Government will continue to benefit all the workers of our great Country. As we continue to work on behalf of workers throughout the Federation, I am pleased to inform you that the Government will pursue a number of measures focussed on improving the lives of workers. I am aware that the cost of living is a major concern for our people. I have spent considerable time with my advisors and Cabinet discussing this issue and how we could best respond with fiscal prudence and compassion, thereby bringing a measure of relief to our citizens and residents.
Last Thursday our Cabinet received a full presentation on some initiatives that we can take to help our people cope with the high cost of living which is driven by external forces such as supply chain disruption, the invasion in Ukraine and uncertainties in commodity markets. As Prime Minister and Minister of Finance, I am pleased to announce the following measures to improve the quality of life for our people.
I believe it is important on this occasion, for me to first highlight the critical measures taken to directly improve the lives and working conditions of workers, in particular our Civil Servants— the workers in this Country whose employment conditions are most affected by the Government.
Today, I am pleased to announce that my government has determined that our Civil Servants, Pensioners and STEP workers will benefit from an increase in wages, salaries and pensions at a rate of 10% retroactive to January 2022. This is another clear example of our investing in our people as we put more money in the pockets of a large number of our citizens and residents. These resources will translate to increased purchasing power for approximately 4,000 salaried Civil Servants, 1,064 Government Auxiliary Employees, 1,365 Pensioners and 2,800 STEP workers. This also has the great potential to propel increased economic activities which will in turn contribute to the economic recovery and stimulate job creation across the Federation.
Another key policy initiative that directly affects a segment of our work force is our regularization of STEP workers. As we express appreciation for workers, I am elated to share the fact that we have reached an important milestone in the task of regularizing the STEP workers. The Select Committee and the Human Resource Management Department have successfully completed the work necessary to facilitate the integration of the first group of STEP workers into the Public Service as Government Auxiliary Employees. Over the last two weeks, hundreds of persons have received letters offering permanent employment with the Government. Many doubted that we would get this far but I say glory to God for His many blessings on our workers and our Country. These workers can now enjoy greater job security and their due rewards for their contribution to the work of the Government. The regularization of the remaining STEP workers will be pursued over the coming months. This is clearly an example of our government investing in our people as we provide better job security for a relatively large number of our citizens and residents.
My fellow citizens and residents, I invite you to join me in formally welcoming these workers to the Public Service and wish them every success in their service to our Country.
Given the increasing inflationary pressures faced by the population, the following short-term fiscal policy measures have been adopted for immediate implementation:
On April 13, 2022, the Government granted approval to amend the price build up for gasoline such that the increase in prices at the pump would be moderated. The Excise Tax on the importation of fuel was reduced from $2.25 per gallon to $0.95. This significant reduction will be in place from April to September 2022. The Government also granted an increase in the Gas Station Dealers Margin by $0.30. In addition to the amendment to the price build up for gasoline, we will extend the Fuel Subsidy Programme for an additional six (6) months until September 2022. These measures are being done to mitigate the cost of fuel at the pump and to keep the cost of public transportation affordable for our people.
We will extend the Income and Disability Support Programmes for an additional three (3) months running up to June 2022. This will further assist workers who remain unemployed, are on significantly reduced wages or have additional expenses from caring for children with disabilities. Several heads of households have told me how beneficial the disability support has been to their families. I am happy that my government will extend this support.
We will reintroduce the duty-free allowance that is usually permitted during the month of December on the importation of food items by non-commercial importers from May 01st to September 30, 2022. This will be the longest period that such generous concessions have been granted to our people. This initiative would allow households to import 500 pounds of food items free of duties and taxes. This measure will benefit persons on low incomes who spend a higher portion of their earners on food.
We will place an eight-month cap on the freight cost that is used in the calculation of duties and taxes that are paid on the importation of goods. The cap will be set at the average freight cost for 2019, the year immediately preceding the onset of the pandemic. It is anticipated that this cap would help to moderate the rise in prices that is being observed as a result of increased freight cost. Let me take this opportunity to make very clear this Government’s firm expectation that all suppliers must pass on the benefit of this concession to consumers who face rising prices. The Department of Consumer Affairs will enhance monitoring of these developments to ensure that savings are passed on to the consumers.
We will further extend for an additional 6-month period, that is from July to December 2022, the removal of VAT and Import Duty on hygiene items and the removal of Import Duty and Customs Service Charge on selected items such as vegetables, fruits, fruit juices, cough and cold preparations and vitamin supplements.
We have articulated a coherent and far-reaching set of policies intended to extend social protection for workers and to protect workers’ interests. Over the years, we have demonstrated our solidarity with workers through the support provided to workers’ unions. We continue to support the work of unions through the tripartite arrangement for dialogue on labour issues and the world of work. The Government has funded the participation of union representatives to international labour events and continues to provide concessions on supplies and materials including materials for the construction and upgrade of union-owned premises. We invite existing unions to take advantage of these opportunities which can contribute to the development of these important pillars of the workers movement in the Federation.
In conclusion, I pledge my government’s relentless commitment to the internationally accepted concept of Building Back Better. This is already demonstrated in our people-centered policies, highlighted earlier, and our 2022 capital investment programme which supports investments of $180.4 million. During this quarter, we will accelerate the implementation of our capital programme to generate jobs and provide decent work for those citizens and residents who are in search of work. As I indicated in my 2022 Budget Address, this year we will complete the work started to review issues related to compliance with the Social Security legislation and the Protection of Employment Act. The Government therefore encourages employers, including self-employed persons, to do the right thing by honouring the statutory obligations to the Social Security Board. I again encourage workers to make occasional checks with your employers and the Social Security Board to ensure that the necessary payments are being made on your behalf.
Today, I salute all workers across the Federation. I ask all workers, employers and indeed the whole country to join me in this special salute and the celebration of Labour Day 2022. We are determined to continue to build together our stronger, safer, future! Our workers – our precious human capital – are our single most important resource in this endeavour and their welfare is, and will always be, paramount.
In the spirit of solidarity, I urge all of us to find ways to motivate and support each other to greater love and to doing God’s work.
I Thank You.