ubstantive discussion
of the social and economic consequences of secession took place on 31 July at
a luncheon meeting of the St. Kitts-Nevis Chamber of Industry & Commerce.
The presentation by Oral Martin, Director of Planning in the Nevis Island Administration
(NIA), was perhaps the most detailed look at these issues in a public forum
to date.The speaker made it clear that he was speaking as an individual, not as a representative of government, and that all his figures were rough estimates. Martin used the phrase "political separation" rather than secession, and emphasized the need for "interdependence" among the two independent islands.
A major theme of his talk was the need to "undertake serious research and prepare position papers to address the social and economic" issues. Martin asked the listeners to challenge his assertions and engage in the process of finding the true answers.
Acknowledging that the social implications of separation will depend on negotiations which have yet to begin, Martin attempted to outline the economic picture. In terms of access to external funding he said that "relations between the two islands aren't as important as the relations of each government with prospective donors." His figures show that separation would produce an increased per capita income in Nevis and a slightly decreased figure for St. Kitts, saying that this might decrease Nevis' access to concessionary funds.
Social Security is one of the big financial questions. Martin said that perhaps $35 million of the current Social Security fund has been contributed by Nevisians. He expects that such a large sum would require a "phased turnover". Since both governments borrow from Social Security to finance other projects, separation of the funds could lead to proposals to increase the percentage of salaries which go into it.
Martin estimates that the NIA expenses could increase by as much as $20 million annually. Three-quarters of this would go to establishing a foreign service and international relations, new government offices, a police force, courts and a high security prison. Increased payment for training teachers and nurses and fees for hospital use also fall in this category. The remaining $5 million would service the debt.
Identifying the sources of revenue to meet these added expenses was more difficult for Martin to do. He predicts that $4 million can come from monies which now go to St. Kitts for customs, corporate taxes and fees, departure taxes, telephone taxes, etc. Another $2-4 million could be gathered through more effective tax collection. Restructuring government services, particularly the Electricity Department could save $1 million. If the growth of government revenues in Nevis continues at its current rate of $3 million a year this will also provide valuable funds.
However, this still leaves a shortfall of $7-8 million in the short-term. Such fiscal pressures could lead to the reintroduction of personal income tax (a statement which was met by uncomfortable laughter from the Chamber members) or expanded consumption taxes. Martin noted that sharing certain government functions would be one way to reduce the economic burden on each island. He suggested overseas missions, policing, courts and health services as possibilities for such interdependence.
Taking a hopeful tone, Martin remarked that "it seems unthinkable that any sober politician on St. Kitts or Nevis would restrict the flow of people" between the islands. He believes that the greatest social effect may be on the large number of people "who must decide if they are Kittitian or Nevisian--a psychological difficulty."
The political separation doesn't define what will happen socially or economically according to Martin. He concluded by suggesting that "there may yet evolve a political relationship which St. Kitts and Nevis could invite other islands to join, beginning with Lester Bird's Antigua."
In the question and answer period several people questioned Martin's assumption that the economic integration of the islands would continue at the same level after secession. Charles Wilkin shared his belief that according to the Constitution the Crown Lands on Nevis don't automatically pass to the NIA at secession and that such a transfer could pose a considerable economic burden.
Charles Springer drew enthusiastic applause when he encouraged the Chamber to "muster the courage to get the parties to sit down and talk." It appears that promoting dialogue on how to resolve the differences between St. Kitts and Nevis will remain high on the Chamber's agenda.
