150. ECONOMIC AND SOCIAL ISSUES (1958-61)

After the British Government refused to expand the development plan, the PPP Government in early 1959 was faced with a situation where it needed more money to expand works programmes to increase employment and to provide increased payment to workers. This was compounded by a drop in revenues as a result of a decrease in bauxite exports and a drought the previous year which affected sugar and rice production.

To raise the money required, the Government proposed in its budget an excise tax of half a cent on a bottle of beer, and a duty of three cents on each pound of imported potatoes aimed at protecting the local ground provision industry. While these new taxes were placed on consumers, the Government also taxed the wealthy sugar producers, land owners and rum manufacturers. The taxes on sugar and rum production and on land acreage — which had been abolished in 1951 — were strongly opposed by the Governor, Sir Patrick Renison. However, he agreed to the taxes when Dr. Jagan presented evidence that the Colonial Treasurer at that time had stated that the measures should be re?introduced if economic conditions were not improved.

The tax on beer received vehement opposition from Peter D'Aguiar, the owner of Banks Breweries. He organised a country?wide "axe the tax" signature campaign and led protest demonstrations in Georgetown. This campaign collapsed after the budget was passed, and as Dr. Jagan had predicted during the budget debate, Banks Breweries and its parent company, D'Aguiar Brothers Limited, made huge profits and shared large dividends in 1959 and in succeeding years.

Early in 1959, the Governor appointed the Gorsuch Commission to consider claims by the Civil Service Association (CSA) for increased salaries for its members. The Commission reported in April 1959 and recommended an increase in the minimum wage for unskilled workers from $2.52 to $2.70 per day. It proposed no increases for middle grade civil servants, but on the other hand recommended large increases for the upper grade civil servants who had the highest salaries.

The Government had difficulty in accepting these proposals. It could not agree to the substantial increases for only the upper level civil servants. In commenting on the Gorsuch Commission recommendations, Dr. Jagan categorically stated that he would “not give a cent more” to the upper level civil servants unless consideration was given to the other levels.

Clearly, Dr. Jagan statement was in support of civil servants at the lower and middle levels. But it was later taken out of context and mischievously distorted by his political opponents to demonstrate that he was determined not to give a cent more to all workers. Unfortunately, the continuous repetition of this distortion caused some people to believe this concocted fiction as fact!

This mischief originated from the leaders of the Civil Service Association, most of whom at that time were drawn from the upper levels of the civil service. This group was heavily backed by the leadership of the TUC, which later teamed up with the political opposition to carry out acts of destabilisation to remove the PPP Government in the 1960s.

Despite these difficulties, the Government managed to complete most of its projects. These included surveys on soil, a forest inventory, telecommunications, transport, petroleum, an aluminium smelter, fisheries and the Canje Reservoir Scheme. Funding of $6 million for these surveys came from the United Nations which also began work in the areas of health, preventive medicine, and the training of personnel in public administration.

The big success of the Government was the purchase of the Demerara Electric Company for $18 million from its private Canadian owners. This nationalisation ended the constant blackouts in Georgetown and gave a boost to industrial development. To encourage industrialisation, the Government began the establishment of the Ruimveldt industrial estate on abandoned sugar estate land it purchased from the Demerara Company which demanded the very high price of $12,000 per acre.

For the expansion of agricultural production, a drainage and irrigation and land distribution programme was started at Black Bush Polder and Tapakuma. At the same time work began on an engineering design for the Mahaica?Mahaicony?Abary agriculture project aimed at developing a quarter of a million acres of land.

In the field of trade, the Government obtained a market for surplus rice in Cuba at a price which was almost two cents higher than other markets in the Caribbean. These higher prices helped to bring improved prosperity for rice farmers all over the country.

Health services rapidly improved in the 1957?61 period. Mrs. Janet Jagan, the Minister of Labour, Health and Housing, obtained UN assistance in fighting malaria in the interior districts. An anti?polio and anti?typhoid scheme went into full operation, and a pure water system with new wells, overhead tanks and new pipe lines was established. The Government also embarked on the construction of rural health centres which formed the basis of free medical care in all parts of the country.

Just before the end of its term, the Legislative Council passed legislation for the Government to take full control of 51 primary schools which were under the control of Christian denominations. These schools were built by the Government but had been given to these denominations to manage. Much opposition to this take over came from the Christian Social Council, an organisation formed to represent the interests of the Christian denominations.