National Budget reduced by $2.5 billion Loop Jamaica

The content originally appeared on: Jamaica News Loop News

The National Budget for the current fiscal year has been reduced by $2.5 billion to $1.092 trillion.

This follows Tuesday’s tabling of the 4th Supplementary Estimates for the 2023/24 fiscal year that ends March 31, by Finance and Public Service Minister Dr Nigel Clarke, in the House of Representatives.

Clarke shared that the areas of production and consumption and international trade did not perform as expected and there was a negligible reduction in tax revenues.

By comparison, the 3rd supplementary estimates that were approved on September 26 last year added $58.2 billion as a result of a $ 43.1 billion increase in revenues and grants. Increased tax revenue during the period amounted to $35.8 billion, non-tax revenues $6.1 billion, and grants $1 billion.

On Tuesday, Clarke also tabled the Jamaica Public Bodies 3rd Supplementary Estimates of Expenditure for the year ending March 2024. Both documents have been referred to the Public Administration and Appropriations Committee of the House for consideration and report.

Clarke highlighted that as the end of the fiscal year approaches the Government has taken stock of the performance trends of both revenue and expenditure, thus the adjustments to the existing budget for both the central government and public bodies.

“The 4th supplementary estimates provide for the reallocation of resources from currently identified activities to other activities,” he said. He pointed out that where current allocations cannot be spent over the remaining seven weeks of the fiscal year, those allocations have been redirected.

Meanwhile, a breakdown of the allocations in the 4th supplementary estimates shows the following:

-Recurrent expenditure of $302.2 billion, up $2.1 billion from $300.2 billion.

-Compensation of employees remains flat at $404.2 billion as compared with $404.5 billion.

-Interest payments total $172.7 billion, up $2.6 billion.

-Capital expenditure of $59.3 billion is down $7.4 billion from $66.6 billion.

-Amortisation is $138.6 billion, up 0.3 billion from $138.3 billion

-Non-debt expenditure totals $14.7 billion which is unchanged from the prior level.

Clarke said transfers to several public bodies for a total of $2.3 billion contributed to the increase on the recurrent programme.

“In addition to that amount, the NSWMA is being provided with $1.6 billion which covers an advance of $400 million previously provided,” the finance minister said. The amount is to settle arrears and support operations until the end of the fiscal year.

Additionally, a $3 billion increase in debt service is mainly due to higher interest rates on external variable rate debt.

Clarke said: “Under the 4th supplementary estimates, the targeted fiscal balance of 0.3 per cent of GDP remains the objective as the government continues its effort to meet the medium-term debt-to-GDP target of 60 per cent by fiscal year 2027/28”.

About the public bodies’ third supplementary estimates, Clarke said it indicates the transfer of 3.2 billion in financial distributions to the consolidated fund and a transfer of $2.3 billion from the central government to public bodies.

Entities to receive funds from the central government are the National Water Commission, the Jamaica Urban Transit Company, the Transport Authority, the Jamaica Racing Commission, the Jamaica Agricultural Commodities Regulatory Agency, the National Export/Import Bank of Jamaica, the Students’ Loan Bureau and the Public Accountancy Board.