Still holding the national finance portfolio late 2005, President James Michel presented 2006 budget as ‘aiming to reduce cost of living’. A year later he called on all citizens of this country to come ‘Together for the Love of
Main reason for the sharp increases has been attributed to constant rise in price of fuel on the international market, which also provoked price increases for certain commodities this country needs to continue importing. Continuous increases in price of fuel is not something new; it is well known that since 2005 fuel prices have been going up from under $40 to the current level of over $100. What is important to note is the fact that before devaluation of our national currency we needed about 600 rupees to pay for a barrel of oil costing $100; today we need more than 800 rupees. Where should the blame go for this need of extra 200 rupees? Why did our government decide to drastically reduce the value of our currency at a time when our citizens were already feeling the impact of price increases on the international market?
Long before fuel prices began to systematically affect prices of many essential commodities there were calls or strong suggestions by opposition voices including the local business community for smooth adjustment of the local currency. It made a lot of sense at a time when 10 or 15 percent devaluation could have been surmounted. If we look at our island neighbours in
Sadly enough, in our country ruling politicians for years enjoyed the art of ridiculing or humiliating ideas and expressions that did not match or conform with their political whims or personal desires. There have also been many questions regarding the attitude or ethical behaviour of certain personalities whose responsibility to this nation in the domain of economic guidance and financial management seem to have been affected by shortsightedness or mere selfishness. It is very evident that if the value of the Seychelles Rupee had been systematically adjusted during the last decade, our citizens would today be feeling a lot more comfortable with our daily life experiences. There would be no need to make us see the price of fuel as a kind of predator.
Challenges Of New Times
On more than one occasion our head of State has described his people as “a young but maturing and optimistic nation, ready to face the challenges of the new times”. Since the launch of the 2008 budget the scenario is taking shape for us to handle our challenges and realities. Starting with the call for every citizen to tighten our belts – ser nou sang. Will this really apply to each and everyone??
Lowest category of State employees have been promised 400 rupees increase effective January 2008; private employers have been requested to do likewise for their employees. These are people with monthly earnings of rupees 2500 to 3500, whose average increase will come to less than 15 percent. Public servants with higher salary levels will receive less both in amount and percentage. The distance between actual cost of living and increase in wages and salaries is so vast that in his budget address the Minister of Finance refused to talk about percentage increase. On the other hand, after all National Assembly members had raised their hands high in favour of the budget, no time was wasted to announce percentage increases for elected personalities and Constitutional appointees – above 30% for the President, Vice-president, ministers, Opposition and Government Business leaders and other personalities, down to 24 percent for Chief Justice and 23 percent Court of Appeal President. Many, if not most, of these personalities are also enjoying fat allowances that can cover their expenses for electricity, water, cooking gas, and so on.
No-one bothered to compare these percentages with what lower-paid employees had been promised. And the minister proudly informed the Nation that such move was in line with a Commonwealth principle. Does such principle encourage governments to disregard the hardships and difficulties which the vast majority of citizens are going through? In this regard, it is worth noting that in December 2006 the Commonwealth Secretary General issued a statement to commemorate International Human Rights Day (10th December). In that message Mr. Don McKinnon laid emphasis on violation of certain human rights as being cause for poverty in certain developing countries. Very interestingly, our government and State media remained totally silent about that very significant message, thus denying our population the right to important and valuable information that reflected one among several Commonwealth principles.
Growing Poverty Threats
From July to November 2007 CEFRAD organized several activities, supported by other organizations and institutions, as part of Millennium Campaign and the Global Call to Action against Poverty (GCAP). Seychelles Government simply ignored that civil society initiative, and the State media decided to block information they were asked to share with the general public about growing poverty threats. Was that because our leaders already knew about those painful steps they were planning to push ahead? During the second half of 2007 many kinds of feelings have been expressed, many pointed questions still remain without answers. Right now one big question is: How can ordinary citizens cope with such high cost of living increases? Ever since devaluation of our currency was officially made public, prices of food items and other essential commodities started going up – not just because more forex was required, also because a lot more rupees were needed to buy the forex. As main provider of those commodities, Seychelles Marketing Board (SMB) has made it clear their prices will continue to shoot up. This is the main cause of our actual dilemma, placing hurdles in the way of State and non-State traders.
And when it comes to our elderly citizens, an increase of 100 rupees to their social security benefit comes to only 5.7 percent; and citizens with severe incapacity or disabilities, some of them are receiving as little as 400 rupees a month. The road to extreme poverty in these islands is becoming a reality day by day.
A final point: it is very evident that the value of our rupee shall continue to reduce. We all have the right to know to what extent our financial authorities intend to let our currency sink. As a maturing and optimistic nation we need to prepare ourselves for challenges of new times. It is very evident that citizens of this country can no longer rely on the State for sustainable living.