Govt. to Borrow Less to Cover Deficit and Amortization Payments

During financial year 2010/11, the Government proposes to borrow $176.6 billion to cover the projected fiscal deficit of 6.5 per cent, and amortization payments, a big reduction from the $301 billion that was borrowed during the last fiscal year.
“Of the total, $118 billion is programmed to be raised from the domestic market. The remainder of $58.3 billion is to be raised from external sources, in the form of investment project loans and policy development loans,” Minister of Finance and the Public Service, Hon. Audley Shaw, said during the opening of the 2010/11 Budget Debate, in the House of Representatives, today (April 8).
The Minister told the House that the budgeted expenditure for the financial year 2010/11 is $503.9 billion.
“As in previous years, debt-servicing of $240 billion accounts for the largest portion of the budget (47 per cent), and has dropped sharply from 60.6 per cent last year. This is followed by education services of $71.9 billion (14.2 per cent).national security services of $38 billion (7.5 per cent) and health services of $31.6 billion (6.2 per cent),” he told the House.
The Finance Minister noted that revenue and grants are projected at $326.3 billion, representing an increase of 8.5 per cent over the last financial year. He added that tax revenue of $287.2 billion is also budgeted to grow by 8.0 per cent over collections in financial year 2009/10.
Mr. Shaw said that the budget has been crafted during “one of the most challenging periods in recent years.” The challenges, he said, arise against the backdrop of a less than favourable international economic and financial climate, resulting from lower levels of economic activity in the world’s major economies, which contributed to a sharp decline in the domestic economy.