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Minister without portfolio in the Ministry of Finance and the Public Service, Senator Don Wehby, has said that despite having to make some revisions to the Central Government budget, the Ministry is committed to the task of staying as close as possible to the targeted fiscal deficit of 4.5 per cent of Gross Domestic Product (GDP).
Meanwhile, as a prelude to the finalisation of the supplemental budget, the Prime Minister has summoned his Ministers to a special meeting of the Cabinet scheduled for November 27, to discuss the challenges that will impact public expenditure up to the end of the current financial year.
Senator Wehby, in his State of the Nation address to the Senate on Friday (Nov. 17), said that revenue and grants for the current fiscal year was $306 billion while the budgeted expenditure was $349.2 billion, with a targeted deficit of $43.2 billion. He informed that for the first half of the fiscal year (April through September), there was a deficit of $25.7 billion, as against a budgeted deficit of $28.8 billion, which is $3.1 billion less than expected.
“One of the most important responsibilities the Government has, is one of disciplined fiscal management. If we consistently turn out fiscal deficits, our only option is to borrow to cover those additional expenditures. It is therefore extremely important that we have a balanced Budget in the medium term.”
With respect to tax collections, Senator Wehby noted that these tax receipts totalled $117.1 billion, $4.7 billion less than budgeted, while locally generated receipts from the General Consumption Tax (GCT), were $2.9 billion behind budget, reflecting the general slow down in consumption.
The Minister explained that it was against that background that expenditure since the beginning of the financial year had to be curtailed. “Total expenditure amounted to $157.1 billion or 5.1 per cent less than was budgeted but was 15.4 per cent more than last year. The total expenditure for wages and salaries was $48.9 billion, a negative variance of 2.3 per cent, but this variance is expected to change in the second half of the fiscal year, as payments are made to public school teachers and the Jamaica Constabulary Force,” he explained.
With respect to the budgeted amount for Capital Expenditure for the fiscal year, which was $44.8 billion, the Minister said that there were no plans to effect a reduction. “Fiscal year to date expenditure is $13.2 billion; however there are capital projects underway, which are not reflected in this figure, due to timing issues. No decision has been made at this time to cut capital expenditure.”