Minister of Finance and the Public Service Fayval Williams has introduced the contours of the budget that will guide the Government’s programmes for the 2026-27 fiscal year. It seems obvious that this budget took a lot of deliberation and thinking through. It is the first budget after the most devastating hurricane and natural event to have hit the island, wiping out almost 41 per cent of the country’s gross domestic product (GDP).

For any Government, crafting a budget in the context of this tragedy would be a very difficult exercise. It is made particularly worse, and perhaps more terrifying, when one contemplates that with its fiscal house in order and all the macro-economic indices in place, the economy was poised for serious economic growth only to have the wind knocked out of it. I do not think it is easily appreciated how hard a blow this must have been, especially to Prime Minister Dr Andrew Holness and his Cabinet. It is made harder by the fact that this Government has taken pride in presenting itself as an icon of fiscal prudence, of not undertaking any excessive borrowing to finance the country’s growth strategies, and not imposing any new taxes on the people — a phenomenal feat it has achieved for almost a decade.

Suddenly it is faced with the prospect of having to borrow from external sources, increasing the debt-to-GDP ratio while imposing new taxes to fill the monetary gaps in the budget this fiscal year. Any rational assessment of where the country is will understand the perspicacity of these actions.

But there are those who will silently, and some openly, berate the Government for going back on decisions from which they have benefited for the past 10 years. But any well-thinking person will understand that Hurricane Melissa has changed things in a drastic way. No serious Government would do anything other than to embark on the actions that were announced in Parliament last Thursday, which will be the fulcrum of the budget process going forward.

The questions then become: How much should the country borrow? What new taxes will be applied, and to whom and where? The Government is proposing borrowed funds of $150 billion from external sources. Bear in mind that the international community, in the aftermath of the hurricane, has already committed to finance the Government’s recovery and rebuilding process to the tune of US$6.7 billion, including miniscule amounts for grants. The borrowed funds no doubt will come from those facilities, and given what we went through, one can expect favourable interest rates with moratoria for repayment being established. One can be sure that serious negotiations are already underway, and this column wishes the finance ministry well in this regard.

With respect to taxes, it is well known that no one likes to pay them, especially having been spared from new ones for 10 years. One can be certain also that it must have been a great strain on the heart of Government to do so, thereby breaking a record in which they obviously basked. But the times call for this action.

There is more discussion to come when the budget debate officially opens, but from what has been suggested so far, the proposed tax measures seem quite targeted, with the intention of not causing great distress on the general public. The so-called sin taxes on alcoholic beverages and cigarettes were a given. Apart from the manufacturers themselves, taxes on sweet beverages have not evoked a great deal of negative reaction.

However, I find the taxes on the hotel or hospitality industry a bit curious, if not troubling. It must not be lost on the country that the area hardest hit by Hurricane Melissa was the western belt of the island and unarguably the centre of the country’s hospitality industry. Some hotels are yet to recover from its devastating impact, and even those that might have recovered would have suffered setbacks. If there was ever an area that needed relief, this would be it. Imposing taxes on a sector so crucial to that demography seems inadvisable. One suspects that the minister of finance will return to the subject when she makes her delivery. One is at a loss about the thinking of the Government on this one.

As this budget debate season unfolds, one hopes for trenchant but responsible criticisms from all sectors. The voice of the Opposition must be listened to. Because of the tribal politics that we practice it is easy, as I have seen, for their colleagues on the other side of the political fence to dismiss what they have to say as nonsensical or simply to stir up trouble. It is true that the posture of some members of the Opposition have in the past been belligerent and politically hostile and partisan. But I have seen some maturity emerging. Their input must be listened to. Jamaicans are well versed at picking sense from nonsense and are very clear in how they reward it. They deserve well-reasoned, productive, and balanced presentations from both sides.

Governor General’s Departure Has Come

I echo the sentiments that are circulating in the public domain that the time has come for Sir Patrick Allen to retire. It is very disheartening that one has to write this, yet it has to be stated.

It is no secret that he is not well and has not been so since he had spinal surgery. He attended to the pageantry of the opening of Parliament last Thursday with the dignity that has characterised his time as governor general. But it was clear to me that it was a distressing, if not a painful, exercise for him. Delivering the Throne Speech was a laborious exercise.

Sir Patrick has served his country well, and while under other circumstances one would like to see him continue with his duties, it is not fair to expect him to do so under the personal strain that he has shown in his public engagements in recent times. I cannot see him going beyond this year. I believe he will make the right choice. This column wishes him and his family well.

Dr Raulston Nembhard is a priest, social commentator, and author of the books Finding Peace in the Midst of Life’s Storms; Your Self-esteem Guide to a Better Life; and Beyond Petulance: Republican Politics and the Future of America. Check out his podcast — Mango Tree Dialogues — on his YouTube channel. Send comments to the Jamaica Observer or stead6655@aol.com.

Patrick Allen (Photo: Naphtali Junior)

Fayval Williams.

Prime Minister Dr Andrew Holness (Photo: JIS)

Raulston Nembhard