Feb 06 - Opposition: Government Financing Expenditure Through “Untraditional Means”
The Opposition says that the announcement last week in Parliament that the shares formerly held by the Slovenian entity in Gibtelecom had been purchased by the Gibraltar Savings Bank “raises important questions which directly relate to the concerns raised by the Opposition in relation to the state of our public finances.”
The public will recall, says the GSD, that the Chief Minister had stated that the Gibraltar Government itself was purchasing the shares at Euros 47.7 million. The move was described as one which would make the Government the ‘sole shareholder’ of the company. Mr Bossano, however, revealed last week in answers to the Deputy Leader of the GSD, Damon Bossino, that it was in fact the Savings Bank and not the Government which had purchased the shares.
The GSD says that it is clear that this move allows the Government to avoid a further expenditure of some £35M which would have reduced its cash reserves down to some £25M or brought it even closer to the borrowing limit prescribed by law. In this regard, the borrowing limit at the moment stands at £443M and net debt stands at £392M so the Government can only spend another £51M from money it has borrowed. This must be the real reason behind effecting the purchase through the Bank instead of the Government, according to the Opposition. The GSD insists that the Government knows that it cannot afford all its financial commitments and has to resort to funding other than from the pot of money traditionally available to Governments and voted by Parliament.
The GSD says that the decision also shows that the Chief Minister who is also the Minister for Finance, “is not taking the decisions and is not even aware what those decisions are”. Mr Bossano and not he appears to be in control of the purse strings not surprising given that Mr Bossano believes Ministers have been “brainwashed” into overspending, says the Opposition.
