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VIDEO: 'Adjust it Andrew'

Golding urges Holness to announce changes to the spending when he makes his budget presentation today

BY ARTHUR HALL
Editor-at-Large
halla@jamaicaobserver.com

Thursday, March 18, 2021

Opposition Leader Mark Golding has called on Prime Minister Andrew Holness to use his presentation in the budget debate today to announce changes to the Government's spending plans for the 2021/22 fiscal year.

Responding to questions from the Jamaica Observer following a People's National Party (PNP) post-budget media briefing yesterday, Golding underscored his claim that the expenditure budget announced by Finance Minister Dr Nigel Clarke is timid and urged Holness to announce the adjustments.

“I would love him to say that he has rethought the budget and he has realised that the expenditure package announced by the finance minister is not going to address the deep problems that have been visited on the people as a result of this pandemic.

“With a negative growth of around 12 per cent, and with over 100,000 people losing their jobs, the hardship out there is real,” said Golding.

He argued that proof that the Holness Administration is not aware of the hardship Jamaicans are facing came on Tuesday with the laughter from Government Members of Parliament when he displayed a basket of goods which he said cost the one-off payment of $10,000, the amount paid as part of the Government's COVID-19 Allocation of Resources to Employees (ARE) last year.

“The response of the Jamaica people to that was to say, 'How is this Government so out of touch with the reality'. That cannot feed a family for two weeks and that is all that the poorest people have got from the Government over eight months and they are not looking to spend any more,” said Golding.

“So my point is, prime minister, the people need help and they need help that is adequate and sufficient and it can be done. It will not set back the country in any major way if you do it. To the contrary, it will protect the country, strengthen the country and allow us to bounce back faster,” added Golding.

In his budget presentation on Tuesday, Golding endorsed a call by Opposition spokesman on finance Julian Robinson for the Government to add $21.5 billion, approximately one per cent of the country's gross domestic product (GDP), to the $831-billion budget to accommodate more social programmes for the vulnerable.

“This is when the Government should alter its direction if experience and data show that their approach is failing to meet the needs of the people. At this time of crisis, people must be the priority. People must be at the centre of policy. However, in the face of the deep economic and social crisis, the response of the Government, in my view, has been to continue its tight embrace of fiscal conservatism,” Golding told the House of Representatives.

Despite criticisms of the proposal from some analysts, Golding and Robinson stood firm yesterday as they responded to questions at the media briefing.

According to Robinson, there are several options available to the Government to fund the additional spending without being fiscally irresponsible.

“There are options, for example, at looking at the obligations that the Government may choose to undertake in the next fiscal year and determine whether they push out some of those obligations or differ some of those obligations,” said Robinson.

“The Government can also... make a decision to raise money possibly on the local market [to] mitigate the exchange rate risks. So there are options that are available to the Government and I do not believe that the additional spend will force us into borrowing to pay interest at all,” added Robinson, who argued that additional spending is needed to grow out of the crisis facing the country.

In endorsing his finance spokesman, Golding told journalists that in the present low interest rate environment the Government has the ability to service its debt.

“So a one per cent increase in the debt-to-GDP ratio is not a huge risk,” argued Golding.

“If we had to borrow to fund an additional one per cent of GDP and spent it in the way that we have identified, investing it in the people, helping businesses and also building out the tech infrastructure so that we can modernise the economy in the post-pandemic world, it will generate more rapid recovery, more revenue to the Government and the ability to service the borrowings better,” argued Golding.