Jan 2015 Financial News

...Howai: Govt prepared to revise budget again

Jan 27, 2015

Government has indicated that it is prepared to again revise the 2015 budget if the need arises.

Noting that oil prices yesterday morning dropped below US$45 a barrel, on which the revised budget is now pegged, Finance Minister Larry Howai said if prices drop below this for a sustained period, Government would take action.

He was speaking to reporters yesterday following the opening ceremony of the Trinidad and Trinidad Energy Conference 2015, at Hyatt Regency, Port of Spain.

“We recognise the volatility in the industry. We know that prices fell below U$45 today. It doesn’t mean that necessarily we need to revise the budget at this time because we did enjoy prices that were above US$45 for most of the first quarter of the fiscal year,” Howai said.

“But we recognise where this reduction could go and in that context we thought it is best that we signal should prices go below that level, and even for a more sustained period, we will be prepared to reconsider and recalculate and evaluate what that means for our budget for this year,” he added.

The minister made it clear that if projects have to be re-evaluated, the extension of the Solomon Hochoy Highway to Point Fortin will remain untouched.

“It’s well advanced. Most of the funds have already been disbursed and, of course, there are also large penalties associated with any sudden stop of a project like that,” he said.

“That is totally out of the question. There is no question that we will continue the Point Fortin Highway. We have strong reserves and we also have a relatively strong fiscal position and strong cash balances that will allow us to complete the Point Fortin Highway, so that is not an issue.”

Energy job cuts

On another note, Howai said some energy companies have told him they have no intention of cutting jobs because of falling oil prices.

“Of course, this could change and depending on the extent to which things change and decisions that are made by the head office, we’ll have to look at it,” he said.

Last Friday, BP Trinidad and Tobago (bpTT) revealed it offered VSEP (Voluntary Separation of Employment Programme) to some of its employees.

Yesterday, bpTT regional president Norman Christie brought up the issue during his presentation at the conference.

“Of course, only a few employees will likely express an interest, and we won’t accept any applications that could jeopardise safety or our performance,” said Christie.

“However, through simplification and efficiency efforts, along with reduced activity, we will be able to accept some applications. We will do this in a way that recognises our employees as our most important resource,” he added.

Source:
Trinidad Express
Tuesday January 27, 2015

http://www.trinidadexpress.com/news/Howai-Govt-prepared-to-revise-budget-again-289864181.html