Jamaica increases national budget by nearly J$25 billion
KINGSTON, Jamaica, Feb 1, CMC – The Jamaica government is increasing the national budget to J$998.2 billion after Finance Minister Dr. Nigel Clarke tabled the J$24.5 billion third supplementary estimates of Expenditure in Parliament.
Government Budget to $998.2 billion, Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke said the additional expenditure is primarily to facilitate payments under the public-sector compensation restructuring exercise, which accounts for J$23.7 billion of the supplementary amount.
“Contributing to this increased requirement is a combination of factors, including adjustments to the initial compensation restructure proposal, following discussions with unions and bargaining groups; provision of a higher percentage of the third-year target in year one, and the impact of overtime hours not accounted for in the estimates.”
He told legislators that this additional expenditure is being financed by projected increases in revenue and that the provision for wages and salaries in the third supplementary estimates represents what Jamaica can now afford.
“The third supplementary estimates have wages and salaries at approximately 11.4 per cent of GDP (gross domestic product), and this represents a meaningful adjustment in aggregate from what it was before.
“We can’t go down on a path to have wages and salaries crowd out critical investments in human capital development and in social and physical infrastructure,” Clarke added.
Expenditure on recurrent programmes will increase by a net sum of J$2.7 billion with the authorities noting that contributing to this increase are allocations of J$1.8 billion as a one-off payment to travelling officers in relation to fiscal year 2021/22.
There is also a J$1.6 billion subvention to the University Hospital of the West Indies to assist with their compensation payments, and J$300 million to supplement the increase to existing government pensioners.
“Interest payments are estimated to increase by two billion dollars, comprised of J$1.8 billion on the external side and J$200 million on the domestic side, and these primarily reflect interest and exchange rate changes,” Clarke said, noting that capital expenditure declined by J$2.3 billion and is due to the inability of the allocated expenditure to be undertaken on four projects before the fiscal year ends.
Clarke told legislators that J$1.1 billion has been reallocated to the Southern Coastal Highway Improvement Programme (SCHIP), which absorbed some of the under-expenditure in other capital projects.
He said this additional expenditure is being financed by an expected improvement of J$25.4 billion on the revenue side, primarily from tax inflows. These are expected to increase by J$28 billion consequent on higher growth estimates, as well as taxes from additional wages.
Grant inflows are also programmed to increase by J$1.1 billion, while certain non-tax items of revenue, including the bauxite levy, are programmed to decline as against projections in the second supplementary estimates.
We want to hear from you! Email us at firstname.lastname@example.org and follow @thejamaicastar on Instagram and on Twitter @JamaicaStar and on Facebook: @TheJamaicaStar, or on Whatsapp @ 876-550-2506.