Jamaica News: The House of Representatives on Tuesday (March 26) approved the Third Supplementary Estimates for the 2018/19 fiscal year, which reflect total government expenditure of $802.6 billion.
The figures indicate no deviation between the expenditure out-turns projected in the Second 2018/19 Supplementary Estimates, which were approved in January 2019, and the Third.
Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, who tabled the document on March 20, explained that the Third Supplementary Estimates represent a reallocation of programmed expenditure from areas where provisions have been made and those monies have not yet been spent, with five days to go before the 2018/19 fiscal year ends.
“While maintaining the expected expenditure out-turn for the Financial Year 2018/19, the Third Supplementary Estimates facilitates the reallocation of fiscal space to certain areas of the Budget where execution at February 2019 indicated much slower than programmed implementation,” he said.
Providing details on the areas benefiting from the reallocated fiscal space, Dr. Clarke informed that $2.1 billion has been used to clear streetlight arrears to the Jamaica Public Service Company.
“This follows a payment by the Central Government of $7.2 billion provided in the First Supplementary Estimates. This allocation will bring the total payout for the financial year to $9.3 billion, and based on this letter that I have, dated the 4th of March from the [Jamaica Public Service] JPS, after this $2.1 billion, the Government will not have any arrears whatsoever with respect to streetlights with the JPS,” he said.
The Minister further stated that $577 million was earmarked to complete arrears payment to suppliers of goods and services, thereby putting the Tax Administration Jamaica in a position to clear substantial arrears, going into the new financial year.
He noted that an allocation of $1.5 billion within the Capital Estimates is being transferred to increase the Contingency for Natural Disasters/Infrastructure Rehabilitation provision under Head 20000A: Ministry of Finance and the Public Service, to $2 billion, up from the $500 million approved in fiscal year 2018/19.
Dr. Clarke pointed out that the increased provision is to be transferred to the Contingencies Fund, established under Section 13 of the Financial Administration and Audit Act, and held by the Accountant General in the Bank of Jamaica.
This, he explained, is in keeping with the provision of the FAA Act Fiscal Responsibility Framework, Third Schedule (Amendment 2014), which requires the Government to make budgetary provision for weather-related risks in the Estimates of Expenditure.
The FAA Act, enacted several years ago, provided for the Contingencies Fund, with the aggregate ceiling raised to $100 million in 1992.
The Minister advised that the Contingencies Fund has a balance of $94 million.
“This will be the first time the allocation is being transferred to the Contingencies Fund, specifically for natural disaster risk, in compliance with existing legislation. Jamaica’s economic independence is threatened by our vulnerability to natural disasters. We are, therefore, breaking new ground by making this transfer of $2 billion to the Contingency Fund,” he said.
The Contingency Fund is held in the Bank of Jamaica and managed by the Accountant General.
“Lodgements to the Fund can only consist of monies transferred from the Consolidated Fund Principal Bank Account by way of warrants issued against a provision in the Estimates of Expenditure, after the warrants have been validated by the Auditor General,” Dr. Clarke added.
Source: JIS News