Hou not surprised with govt’s redirection policy


FORMER Prime Minister Rick Hou says he’s not surprised with the Government’s Redirection Policy and the 2021 Budget.

Speaking at the sine die motion in Parliament last Wednesday, Mr Hou, also Member of Small Malaita, said while it is encouraging on the face of it, much of this are the same policies found in a number of election manifestos and in successive governments – a point which was made by the Prime Minister himself.

“Sir, I assume that this new road map is yet to be designed and developed into more focused and well-targeted actions.

“In that spirit, and in the context of the 2021 Budget preparation, I would propose that priority should be accorded to those reforms that will not only enhance revenue collection, but also induce investment and private sector expansion,” he said.

Hou said to that end he’s in total agreement with the Prime Minister, that SI economy is currently heavily taxed.

“Not only that: the tax system is skewed against a small proportion of the population.

“It is directed at the productive sector of our economy,” he said.

“I agree with the Government that they urgently design a broad-based consumption policy, and come with appropriate legislative framework as indicated by the Prime Minister.

“As well, we should remove incentive schemes such as Tax exceptions and remissions, which have been prone to abuse over the years,” he said.

Hou said the Government should invest in a transportation infrastructure system, and a marketing infrastructure network, that will connect the rural producers directly with the export markets.

“I am thinking here about Government making a deliberate choice to support the production of kava, noni, coconut oil, and marine products. 

“These are crops which grow very well in this country, production is all year round, and involves both large commercial framers, as well as at the household level.

“Government investment will also include pressing machineries and large storage spaces.

“Sir, while I admire the Government’s long list of policy choices, and the comprehensive scope of sector coverage of the Re-direction Policy, I suggest that we should be realistic.

“Not everything on the menu can or should be done – it is too long. We must avoid ‘… missing the trees, and getting lost in the forest…’ so to speak.

“Concepts such as Special Economic Zones, for example, may work only when we get the fundamentals – transportation, tax regime and marketing systems – right.

“So, in our current circumstances, especially with the covid-19 pandemic, let us look at harvesting a few low-lying fruits.

“Let us target and concentrate on a few big-ticket items that will make the greatest development impact, given our scarce resources.

“Sir, I think the government’s initiative through the economic stimulus package (ESP) was such an opportunity,” he said.

Hou said the broad objectives and goals stated initially under the ESP were the right ones in my opinion.

“However, I think where the initiative may fail is that the amount is not only dismal but it was spread too thinly.

“It is still early to ascertain the real impact from the $450 Million recently injected into the economy under the Economic Stimulus Package,” he added.

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