THE verbal spat over the Government’s decision to make income the sole determinant of interest rate subsidies on loans from the National Housing Trust (NHT) continued on Thursday with the Opposition firing a fresh salvo against the policy.

Prime Minister Andrew Holness has insisted that the intention is to give more poor Jamaicans the ability to purchase their own home. However, the People’s National Party (PNP) says the policy, which will remove the subsidy on interest rates for disabled NHT beneficiaries earning more than $30,000 weekly, is regressive and has vowed to reverse it if the party returns to power.

Holness had first indicated the Government’s intention in March this year, announcing that the NHT will cut interest rates by one percentage point for all new mortgagors, effective April 1. That adjustment, he had said, means more contributors can now access NHT loans at zero per cent.

The interest rate reduction meant that contributors earning more than $30,000 but less than $42,000 per week now pay two per cent interest as their mortgage rate. In addition, the NHT has doubled its Special Grant for Persons with Disabilities to $300,000, and households with two disabled persons can see this grant doubling to $600,000.

The NHT has also discontinued the interest rate subsidies applied to special groups, arguing that the “subsidies were not being effectively applied based on financial need” as “potential beneficiaries who had similar or lower incomes, when compared to persons within those special groups, could not benefit from these subsidies”.

The NHT said the new approach allows it to “focus its subsidy programme on the most vulnerable contributors, specifically, low income earners of all ages and persons with disabilities”.

But the Opposition has baulked at the plan, and on Thursday issued a news release saying that a future PNP Government “will undergo a thorough review of the regressive policy decision of removing the subsidy on interest rates for civil servants, police, teachers, persons with disabilities, persons over 55 years of age, and others”.

The PNP described the policy as “unconscionable and unjust because these groups have never been properly compensated or recognised by society for the tremendous work they do”.

The party also said that offering these individuals the subsidy on interest rate is just one legitimate means of demonstrating appreciation for their work and efforts.

On Wednesday afternoon, while speaking at the handing-over ceremony for 32 duplex housing units in Majesty Gardens, St Andrew, Holness said “The disabled community listening to the narrative and not having the facts might be quick to say ‘No, don’t take away the policy.’ But you would be interested to know that only 12 disabled persons have actually benefited from the reduction of one per cent in interest rates, only 12.”

Noting that the one percentage point reduction might only amount to “a few hundred dollars”, the prime minister said, “This argument of taking away of subsidies must be placed in the context of the Government reducing interest rate for every category of Jamaicans to the lowest it has ever been, plus increasing the number of Jamaicans who get access to zero per cent.”

“So if you are disabled and you fall within the category $30,000 to $40,000 you get a one per cent reduction in your interest rate so you pay two per cent. If you are in the $42,000 and over you get a one per cent reduction so you pay three per cent. If you are both a civil servant and disabled, consideration can be given to reducing your interest rate even further, and persons earning $0 to $30,000 per week already pay no interest so this policy does not affect them,” he said further.

“As I said, it’s a battle for narratives and this battle is being fought on a political platform which I call the politics of poverty. Everybody is trying to use the poor to win a political argument. That is the real travesty of all of this, saying ‘I am here supporting the poor,’ but the things that are really necessary to improve the lives of the poor get clouded, deliberately obfuscated to sometimes downright lies to trick the poor people to things that are downright detrimental,” Holness declared.

He argued that “The purpose of a subsidy is to enable the person receiving it to increase their ability to consume.”

“You always give the poor people subsidies. There is one group which has raised an issue saying the disabled community would be deprived of the subsidy. The subsidy is that if you fall within a certain category your interest rate is reduced,” the prime minister said.