DESPITE the misfortune of the COVID-19 pandemic, the Government is scaling up its expenditure budget for 2020/21 by $15.7 billion.

Minister of Finance and the Public Service Dr Nigel Clarke yesterday made the announcement while tabling the second supplementary estimates in the House of Representatives, which is being held temporarily at the Jamaica Conference Centre.

The budget, which was trimmed from the original $853.5 billion to $838.7 billion following the first supplementary estimate, now stands at $853.7 billion.

“Even in the face of the worst pandemic, we will be scaling up public investment in the second supplementary estimates. Increasing public investment at this time can help revive economic activity and maintain jobs. It is also an important signal to the private sector of the Government’s confidence about the future,” the minister said.

He explained that it is for this reason the Government is also increasing the capital expenditure component of the budget by $6 billion, of which $4.6 billion will go towards the South Coast Highway Improvement Project.

“As we look to scale public investments in this time, the quality of the public investment matter. We believe that the South Coast Highway Improvement Project meets the definition of the kind of public investment that catalyses economic activity and jobs, which is precisely what is needed at this time,” Clarke said.

He noted that proposed increases in recurrent and capital expenditure will be financed by the level of expected revenue overperformance, as well as by further reducing the primary balance target from 3.5 per cent of gross domestic product (GDP) to 3.1 per cent of GDP.

In addition to increasing capital expenditure to support increased economic activity, given the prolonged and increasing impact of the pandemic, and taking the revenue forecast into consideration, the Government has also found it necessary to increase expenditure to meet COVID-19-related needs in health, education and social welfare in the form of unemployment support.

He noted that recurrent spending in the new estimates has, therefore, focused on extending the support elements of the Government’s COVID-19 Allocation of Resources to Employees (CARE) Programme, specifically the Supporting Employees with Transfer of Cash (SET Cash) and Business Employee Support and Transfer off Cash (BEST Cash) components to December 2020 at a cost of $5 billion, including utilisation of an existing $2.2 billion. Previously announced elements of the CARE Programme, such as the back-to-school grant, will also be regularised.

An additional $1.5 billion has been given to the Ministry of Health and Wellness to aid in the response to COVID-19, which includes a substantial increase in medical personnel.

There is also the provision of $1 billion to the Ministry of Education to assist in procurement of tablets for students in need.

Dr Clarke said, that based on the operations to date and the GDP forecast, revenue and grant inflows for the full fiscal year are now estimated to be $5.2 billion more than indicated in the first supplementary estimates.

He said that the new estimates for 2020/21 have been developed within the framework of this outturn, as well as taking into consideration the continued impact of COVID-19 on Jamaica and the world.

Opposition spokesman on finance and planning Mark Golding said that he would respond to the minister’s opening remarks when the debate resumes next week Tuesday.

In the meantime, the estimates are to be reviewed by the Public Administration and Appropriations Committee (PAAC) on Thursday.