Minister without Portfolio in the Ministry of Finance and the Public Service, Senator Don Wehby, has suggested several solutions to the problem of debt, which he says is crippling the economy.
Senator Wehby, who was the guest speaker at a forum put on by Generation Two Thousand (G2K), the young professional arm of the Jamaica Labour Party, at the Petroleum Corporation of Jamaica (PCJ), auditorium yesterday, (Jan. 21), noted that the Government has developed a six-point plan, called a fiscal and sustainability reform programme.
He said the first area looks at controlling public sector balances and debt, which he explained speaks to transparency over public sector bodies.
Pointing to Prime Minister, Bruce Golding’s address in Parliament regarding public sector bodies’ delay in submitting annual reports, Senator Wehby noted that “we need to control that very carefully,” so that when companies start to go off-track in terms of their management, “we can bring them back quickly, so they don’t cost tax payers that amount of money.”
The other solution he pointed to was rationalising public bodies. “When you look at the historical losses for Air Jamaica, it’s averaging between US$100 and US$150 million per annum. We have made a decision to divest the national airline, it’s a very emotional decision, people may say it’s not a popular decision, but one thing I am convinced about, it is the right decision,” the Minister emphasised.
He said that improving central Government’s financial management and budget processes, also form part of the plan to deal with the country’s debt problem.
Senator Wehby noted that the budget process and how resources are allocated from one Ministry to another, “need to be a little bit more scientific.” He said that as a Government, the introduction of performance-based budgeting “is going to be extremely important in terms of how you allocate your resources after we set our priorities.”
Minister without Portfolio in the Ministry of Finance and the Public Service, Senator Don Wehby, (left) engages in discussion with President of Generation 2000 (G2K’s) Portmore Chapter, Tyrone Wilson. Looking on (from left) are: member of G2K’s Management Committee, Randy Burgess and Research Manager at Mayberry Investment, Wade Mars. Occasion was a forum organised by Generation 2000 (G2K) at the Petroleum Corporation of Jamaica (PCJ) auditorium on January 20, where Senator Wehby spoke on issues of national interest.
In terms of increasing revenue and collections, another aspect of the six-point plan, he pointed to the Inter-American Development Bank’s (IDB) report, which stated that one per cent of Jamaica’s corporations are paying over 70 per cent of corporate income tax.
“What happened to the rest?” the Senator asked, noting that the Government will embark on a system of tax reform. “Reform means simplification of a tax system and lessening the burden on those who are paying most of the taxes…right now you can file your General Consumption Tax (GCT) online, so you don’t have to waste your time and go and line up in any long line to file your GCT especially if you are a small business operator…that is what we mean by improving the whole tax system in Jamaica, and that is of real priority.”
Senator Wehby went on to the issue of bureaucracy and encouraging Foreign Direct Investment. “We need to make it so easy for.foreign investors and Jamaican business people to do business in Jamaica,” he said, referring to the multi-billion dollar Harmony Cove Resort in Trelawny, being developed by the Tavistock Group, an international investment company.
“I was in a meeting trying to finalise this Tavistock (Group) investment. It is a fantastic opportunity for Jamaica if we can pull this one off. It is in the Trelawny area, it is tied to a golf course, and casinos, and has 8,500 rooms, and investment of between US$4 and US$5 billion,” he informed.
“What struck me, meeting with the Tavistock Group,” he continued, “is actually the opportunity that it can present for the small business sector, because if you have this sort of economic activity in one area, I can see that you have a lot of small Jamaican businesses supplying goods and services to this investment.”
He noted that the other area that needs to be looked at is the high public sector wage bill. “When you look at the public sector wage bill, as a percentage of our GDP, it’s running at about 10 to 11 per cent. The bench mark is about eight per cent…my point is about increasing productivity.is there a smarter way that we can run our Government bodies to provide the services that the nationals really need,” he queried.
“We’re going through a financial turmoil that has never been seen in the history of the world, but my position is let’s stay focussed in terms of our reform programmes. Markets go up and markets go down, what we need to do is to ensure that those reform programmes are implemented on a timely basis, with haste, so when the market is going up now.all those Foreign Direct Investments, will have gotten the economy in a growth mode, so we can take off when this market recovers, because it will recover,” he asserted.