EPOC Chairman Highlights Benefits Of Gov’t’s Securitisation Deal

Economic Programme Oversight Committee (EPOC) Chairman, Keith Duncan, has underscored the significant advantages of the recent securitisation deal conducted by the Government.

Earlier this year, the Government secured US$480 million through the securitisation of assets belonging to the Norman Manley International Airport (NMIA).

The Ministry of Finance and the Public Service said the transaction’s net proceeds will be used for paying down some interest costs on the national debt, as well as budgetary support for recurrent expenditures, including spending on government programmes and public sector salary and wage payments.

Mr. Duncan pointed out that this strategic financial manoeuvre has proven to be pivotal in enhancing Jamaica’s fiscal performance and bolstering its economic stability.

Speaking during the final EPOC quarterly press briefing at the Finance Ministry on Friday (December 13), Mr. Duncan said the securitisation transaction has had a profound impact on Jamaica’s financial landscape.

“The inflow from this securitisation effort yielded an impressive $70.7 billion for the Government of Jamaica in October alone,” he informed.

This substantial revenue boost has contributed to a remarkable year-over-year increase in total revenues and grants, which rose by $100.9 billion or 20 per cent, relative to the corresponding period last year.

Mr. Duncan noted that tax revenues reached $475.7 billion, surpassing budgetted estimates by $1.5 billion, reflecting a year-over-year improvement of 5.7 per cent.

“Despite challenges, such as contraction in tax revenues during the July to September quarter, our strategic actions have ensured that we maintain a robust revenue stream,” he added.

The benefits of the securitisation deal extend beyond immediate revenue generation.

Mr. Duncan pointed out how it has effectively offset potential tax revenue losses from various fiscal measures introduced in the 2024/25 budget, including increases in income tax thresholds and pension exemptions.

“These revenue-neutral measures, while necessary for social equity, could have strained our finances without the inflows from securitisation,” he explained.

Additionally, the EPOC Chairman said significant gains were recorded for non-tax revenues, with collections exceeding budget expectations by $2.4 billion, to achieve a $76.1 billion increase compared to the same period last year.

He said this performance underscores the effectiveness of the Government’s financial strategies in navigating economic challenges.

Meanwhile, Mr. Duncan emphasised the importance of maintaining fiscal discipline to ensure sustainability, going forward.

“While we celebrate these achievements, we must remain vigilant in managing our expenditures and ensuring that our growth is both responsible and sustainable,” he stated.