Public must query public debt, finance
Tuesday, April 22, 2014
IT is important for Fijians to know what public debt is and what it means to the ordinary citizen, says independent candidate and ‘Be the Change Campaign’ leader Roshika Deo.
Ms Deo explained that public debt was the total amount of money that a government owed and usually an indication of how much money it’s borrowing to spend on public expenditure and finance.
“We should ensure that the amount of money and the rate of borrowing are sustainable and we are able to service the public debt.
“When we start incurring public debt to finance public consumption that only benefits the current generation, the public debt becomes unsustainable,” Ms Deo said yesterday.
She said members of the public should be aware of the national debt per capita because when this increased, the likelihood of the government defaulting on its debt meant service obligation increased as well.
“The amount of tax revenue available to spend on other governmental services is reduced because more tax revenue will be used to pay interest on the public debt.
“This will result in people having a lower standard of living.
“It can also force people to pay more for goods and services, resulting in inflation.
“When the risk increases of our country defaulting on its public debt service obligation, our country potentially risks our social, economic and political power,” she added.
Ms Deo said as taxpayers, people should be asking and receiving information on how much the public debt of the country actually was, what the borrowed money was being used for, the terms and conditions of this debt, and most importantly how it would be serviced.