Legislation to facilitate the withdrawal of $11.4 billion annually from the National Housing Trust (NHT), to provide budgetary support over the next four years, was passed on Tuesday, March 5, in the House of Representatives.
The Bill, entitled the National Housing Trust (Special Provisions) Act 2013, was piloted by Minister of Finance and Planning, Dr. the Hon. Peter Phillips.
The legislation will enable the NHT to provide financial support for fiscal consolidation beginning financial year 2013/2014 and ending in 2016/2017.
In opening the debate, Dr. Phillips said the decision to utilise the resources of the NHT is necessary in achieving a primary surplus target of 7.5 per cent of Gross Domestic Product (GDP) in the next fiscal year. This, he said, is a critical plank of the Economic Reform Programme and to secure an agreement with the International Monetary Fund (IMF).
He said that if the Government did not seek to access the additional revenue inflows from the NHT, then it would have had to raise the money through taxes.
“After much deliberation, it was the determination of the administration and the Cabinet that this would be the least burdensome option on the citizens of the country,” Dr. Phillips said.
He stressed that the contribution from the NHT would not impair the Fund’s mandate of providing affordable housing solutions, through construction and mortgage options.
The Minister told the House that “we are carrying this legislation not because we did not have the legal authority to do so, but we are doing it out of an abundance of caution to avert any misconstrued challenges by persons with or without contribution, who might want to imperil or derail the Economic Reform Programme or the negotiations with the IMF.”
Prime Minister, the Most Hon. Portia Simpson Miller, said that the Government “wasn’t happy to have had to look at the NHT”.
“A choice had to be made. Do you increase the burden on the poor and the most vulnerable in the society by increasing flour, rice, sugar and cornmeal? In the end, I think the decision that was taken would save the majority of people from more pain and hurt,” she stated.
Attorney General, Patrick Atkinson, in responding to concerns raised by Leader of Opposition Business, Delroy Chuck, regarding the legality of the legislation, stated that the Government is satisfied that “there is no basis for this claim of unconstitutionality”.
“In the first place, there is no taking of property in the sense that is contemplated by the Charter of Rights. Under the NHT Act, the functions of the NHT are to add to and improve the existing supply of housing, to give benefits, which mean low interest mortgages to contributors, and to generally improve the infrastructure of housing,” Mr. Atkinson said.
He stated that none of those functions or purposes will be discontinued or impacted seriously.
“In any event, the Attorney General Chambers looked at all these points, we examined the law and we are satisfied that there is nothing unconstitutional,” he added.
The Bill will now go to the Senate for approval.