Closing of the 2017/18 Budget Debate – Statement by Minister of Finance, Hon. Audley Shaw

Photo: JIS Photographer Minister of Finance, The Hon. Audley Shaw, CD, MP

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  • I wish to once again thank the staff of the Ministry of Finance and the Public Service and other agencies for their assistance in the course of preparations for this Debate.
  • Mr. Speaker, there will be more opportunities to do so in the coming weeks but, I too would like to pay tribute to the Honourable Leader of the Opposition, Mrs. Portia Simpson Miller for her public service contribution to Jamaica.
  • Mr. Speaker, before I respond to the various issues that have been raised, there were a few significant errors made by the Opposition Spokesman on Finance in his presentation that I must address at the outset.

I wish to once again thank the staff of the Ministry of Finance and the Public Service and other agencies for their assistance in the course of preparations for this Debate.

I also wish to thank the Prime Minister, Opposition Leader, and the Opposition Spokesman on Finance for their contributions.

Mr. Speaker, there will be more opportunities to do so in the coming weeks but, I too would like to pay tribute to the Honourable Leader of the Opposition, Mrs. Portia Simpson Miller for her public service contribution to Jamaica.

It was Winston Churchill who said of those in the public service: “We make a living by what we get, but we make a life by what we give.”

Thank you, Most Honourable Portia Simpson Miller.

B. Response to Statements Raised by the Opposition

Mr. Speaker, before I respond to the various issues that have been raised, there were a few significant errors made by the Opposition Spokesman on Finance in his presentation that I must address at the outset.

i) In explaining the Budget, The Opposition Spokesman stated that if we take away Debt servicing costs the overall increase in the Budget is a mere 6 percent and if we take account of inflation the real increase in the budget is about 1 to 2 percent.

Mr. Speaker, this statement is incorrect.

The gross budget expenditures excluding debt service costs show an increase of 10.7 percent over the FY 2016/17 budget. Even if you adjust this by an inflation rate of 4 percent, Mr. Speaker, you would still get a real increase of at least 6 percent.

By any measure, this is a significant real increase in the budget given our forecast of 2-3 percent real growth in the economy.

ii) The Opposition Spokesmen also said, and I quote: “This is NOT a growth Budget. After the $29 billion in taxes, the capital expenditure is only $53 billion, of which $40 billion—and the bulk of this is —for debt repayment, leaving a mere $13 billion for Capital investment…”

Mr. Speaker, I am absolutely shocked by this statement since it reflects a fundamental misunderstanding of the Budget. The budgeted amount for capital spending is $49.3 billion, representing a 10 percent increase over the revised budget for FY 2016/17.

In fact Mr. Speaker, the capital expenditure budgeted for FY 2017/18 is 50 percent more than the capital expenditure that the Opposition Spokesman had for FY 2015/16, the last year the he was at the wicket of government.

Mr. Speaker, our budgeted capital spending for FY2017/18 will be 2.6 percent of GDP.

Theirs was 1.9 percent of GDP in FY2015/16. Mr. Speaker, I must ask the question of the Opposition Spokesman, “Which budget is more pro-growth, the one with the lower capital spending or the one with the higher capital spending?” This is not a trick question. Check your math!

iii) Mr. Speaker, the Opposition Spokesman said that there was a $58 Billion reduction on the Capital A Head in one Programme – Primary Education.

However the total Capital A provision for the entire Ministry of Education was a little over $1.0 Billion. It therefore would not have been possible to reduce any programme in the Ministry by $58 Billion.

In fact, the entire Capital Budget of the Central Government would have been wiped out, not just the Ministry of Education had there been a $58.0 billion reduction in capital spending.

See Full Speech Here 

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