The Independent Fiscal Commission (IFC) has determined that the 2025/26 Budget currently being debated in the House of Representatives is credible, based on macroeconomic and fiscal projections.
According to Commissioner, Courtney Williams, Jamaica’s current fiscal policy and position are sustainable.
He was speaking during the IFC’s inaugural press conference on Monday (March 17) at The Jamaica Pegasus hotel in New Kingston.
Referencing the IFC’s inaugural Economic and Fiscal Assessment Report, which has been published and tabled in Parliament, Williams emphasised that while Jamaica has much to celebrate, it is crucial to maintain focus on fiscal policy.
“For everything else in the economy to function properly, the fiscal house must remain in good order,” he stated.
The commissioner recounted Jamaica’s successful economic recovery, moving from a time where up to 75 per cent of the country’s budget was earmarked for debt servicing, to creating an environment for the private sector to increase production, exports and the national current account balance, and create jobs.
“This improved production also meant more tax revenue and a healthier foreign exchange market with more inflows. This, in turn, meant that the Central Bank (Bank of Jamaica BOJ), instead of just trying to maintain stability by holding strain with interest rates and FX (foreign exchange) market intervention, finally got some breathing space to proactively practice modern monetary policy,” he said.
Williams further explained that this “breathing space” allowed the BOJ to pursue monetary policy reforms reflective of a modernised foreign exchange market, record low interest rates and an entrenched low-inflation environment.
This, he added, thanks to the inflation-targeted regime that has been implemented.
“None of these could have happened without improved fiscal discipline and fiscal consolidation, and cannot continue if we ever drop the fiscal ball. To ensure that we never again stray from a prudent fiscal path, therefore, Jamaica enacted fiscal rules.
“We now have an Independent Fiscal Commission to serve as the arbiter of those fiscal rules and to provide independent technical analysis and opinion on the status of the fiscal policy programme,” the Commissioner outlined.
He noted that the IFC, consequent on its mandate to strengthen and reinforce Jamaica’s sustainable fiscal path, also identified areas for improvement in the current budgetary process.
These include tabling revenue measures concurrently with all other budgetary documents and presenting those measures in the Fiscal Policy Paper; establishing clear compensation negotiation cycles geared towards settling wage negotiations before the Budget is presented; reintroducing a fiscal rule for wages and salaries and shifting the deadline for filing annual income tax returns from March to a month in the first quarter of the fiscal year (April to June).
The IFC, which commenced operations on January 1, 2025, was established by the Independent Fiscal Commission Act, 2021, to promote sound policy and management to sustain fiscal discipline.
It stemmed from the Government’s aspiration to establish a domestic, fit-for-purpose institution to replace the independent economic and fiscal reviews and analyses traditionally provided by multilateral agencies, including the International Monetary Fund (IMF).
