NHT Drawdowns Will Only be Done if Necessary – Senator

Leader of Government Business in the Senate, Hon. Kamina Johnson Smith, is reassuring that drawdowns to support the budget will only be taken from the National Housing Trust (NHT) if deemed crucial.

“It is not intended if it is not necessary, that all four years will be utilized,” Senator Johnson Smith said, while addressing the Senate on July 21.

She was piloting the National Housing Trust (Amendment) Act, 2017, which makes provisions for these drawdowns.

The Bill allows the Government to continue the withdrawal of $11.4 billion from the NHT over the next four years. It was passed in the Senate with no amendments.

Mrs. Johnson Smith explained that this arrangement is one of the revenue measures adopted to contribute to financing the Government’s budget for fiscal year 2017/18.

She explained that it is in keeping with the previous Extended Fund Facility with the International Monetary Fund (IMF), which supported the Government’s economic reform programme.

Provisions were made for prior drawdowns through an amendment to the NHT Act, which came to an end in March of this year. The new Bill sought to renew this arrangement.
Senator Johnson Smith pointed out that the Government was reluctant in opting for this revenue measure, but argued that without this being put in place, the Government would be forced to levy new taxes.

“This measure must be viewed against the background of fundamental tax reform, (that is) the continued shift from direct to indirect taxes….for purposes of equity and the need to create the breathing space over the medium term to undertake public spending reforms, which will take time to implement and the benefit of which will only occur in the medium term,” the Minister said.

“Furthermore, it certainly would be undesirable to cut expenditure on important programmes which are of benefit to the country,” she added.

The NHT drawdowns are expected to continue until the financial year ending March 31, 2021.