Amidst the political theatre between the Government and Opposition over paternity for fiscal discipline lies the fact that the country has benefited in a manner that should have a positive impact on our long-term development.

Indeed, the cross-party consensus on the need for macroeconomic stability is encouraging and, as Prime Minister Dr Andrew Holness said in his contribution to the 2025/26 Budget Debate last Friday, Jamaica now has its strongest ever macroeconomy.

The Government has vowed that, despite this being an election year, it has no intention of eroding the gains to secure power. We will hold the Administration to that promise; for we don’t wish to experience a return to the “run wid it” politics of the past that pushed us into economic peril.

With that in mind, we are also appreciative of the consensus in the budget debate on the need for greater productivity and growth, which have been very weak for every decade since 1972.

Also emerging from the debate were measures to formalise housing and electricity in informal settlements, with an emphasis on solutions funded by the National Housing Trust (NHT) and a Government partnership with Jamaica Public Service Company (JPS). Both measures are indeed important to productivity, and need to be expanded.

Announced measures, such as accelerated capital allowances for investments in buildings and plant and machinery and Mr Holness’s plans to enact an expanded Urban Renewal Tax Relief regime are also potential game changers, particularly the latter, for abandoned town and city centres.

At the same time, we believe there is need for serious debate on some of the more difficult structural reforms, such as in labour and energy, if we are really to increase productivity.

As it now stands, the country is still awaiting the report of the Labour Market Reform Commission (LMRC) which, despite being completed approximately 8 years ago, is, as far as we are aware, still to be tabled in Parliament.

Readers will recall that the LMRC was established in 2015 with a mandate to ensure that the country’s labour market structure, regulations, policies, programmes, and projects become compatible with modern practices in order to improve productivity and economic growth.

As was outlined in the budget debate, Jamaica has both a large degree of “informal” and contract employment, at least partially driven by what, to many, are outdated labour market laws. With the advent of artificial intelligence and its potential impact on the future of work, it is now more urgent to formalise workers by, say, the introduction of unemployment insurance, rather than trying to protect jobs from redundancy. This shift is likely to be expensive, but could be financed by using the employer contribution to the NHT, which everyone agrees is still unable to spend its funds on housing alone.

In this context, the idea of work councils could turn out to be more an attempt to address a symptom than a root cause. It is certainly necessary, however, to find a way to increase the formalisation of employment allowing workers benefits such as health and pension. As such, Opposition Leader Mark Golding’s idea of increasing the employer tax credit to 40 per cent is worth considering.

The extremely critical issue of the cost of energy was also addressed by both the Government and Opposition during the budget debate. The Opposition suggested a full liberalisation of the electricity market, as well as scaling up net billing and introducing power wheeling for distributed generation, while the Government said it is in the process of engaging international experts to support the renegotiation of the JPS licence.

The clock is ticking, however, if we want real reform in this sector, absent some kind of grand bargain with JPS.