Wed | Oct 16, 2019

GOJ seen as dancing around merger targets

Published:Friday | November 16, 2018 | 12:00 AM
Minister of Finance Nigel Clarke has responsibility for the public service. The IMF is urging swifter action on the planned mergers of public bodies.

Get serious. That's the plea from the International Monetary Fund, IMF, which wants the Government of Jamaica to looking more closely at the burden on the public purse and workforce size when prioritising which public-sector entities are to be merged.

In its Fourth Review of the Standby Arrangement between Jamaica and the IMF, released last week, the fund said that out of the 190 public bodies, action had been taken on only 14 so far, with little savings.

"The merger, closure, or reintegration of public bodies have not yet generated significant fiscal savings because the selection of public bodies for actioning has not been guided by the reliance on government financing and workforce size so far," IMF Representative to Jamaica Constant Longkeng Ngouana told the Financial Gleaner in the wake of the report.

"The recommendation in the report is that those two factors be taken into consideration in streamlining public bodies going forward," he said.

The IMF said in its review of Jamaica that the reform of the public sector should "strike a balance between the government's public service priorities and maximising fiscal savings", and that the extent to which the individual public body relies on government financing, as well as the size of their workforce, should inform the decisions.

The Jamaican Government has been trying to signal that it is taking steps to privatise some assets via the stock market, but only one entity, Wigton Windfarm Limited, is known to have made progress in that regard. A broker has been selected and its offering of shares is expected by next March.

And as to plans for the tie-up of agencies that have similar functions - a list the Jamaican Government has said has 84 names on it - that, too, is lagging.

The Ministry of Finance and the Public Service promised an update on mergers completed and those planned for 2019, but the information was not forthcoming up to press time.

The IMF said that mergers, closures and integrations on which action was taken between 2017 and 2018 included the Board of Supervision, the Road Maintenance Fund, Kingston Waterfront Hotel Company Limited, Montego Shopping Centre Limited, and Portmore Commercial Development Limited.

Additionally, the Children's Registry was to be reintegrated into the Child Development Agency, while the operational merger of HEART Trust/NTA, Jamaican Foundation for Lifelong Learning and the National Youth Service has been finalised.

However, the tie-up of the Jamaica Racing Commission with the Betting Gaming & Lotteries Commission has been years in planning, but not finalised, and now the Casino Commission is also to be folded into the same entity as plans for casino gaming stall.

The merger, closure, or reintegration of another 18 public bodies are slated for the next 12 months, the IMF said, including:

- The corporate back-office functions for Clarendon Alumina Production Limited and Jamaica Bauxite Mining, which will be merged with the corporate functions at the Jamaica Bauxite Institute;

- The merger of the Land Administration and Management Programme, known as LAMP, with the National Land Agency;

- The operational merger of the Real Estate Board, the Com-mission of Strata Corporations and the Registrar of Timeshare;

- The closure of the Audit Commission and integration of its functions into Ministry of Finance and Planning;

- The integration of the Management Authority of Plant Genetic Resources for Food and Agriculture into the Ministry of Industry, Commerce, Agriculture and Fisheries.

The Jamaican Government is also working on the reintegration of the National Council on Drug Abuse into the Ministry of Health; winding up the Toll Authority; reintegrating the Legal Aid Council into the Ministry of Justice; closing the National Family Planning Board and folding its functions into the Ministry of Health; closing the River Rafting Authority and folding its functions into the Jamaica Tourist Board; and merging the functions of the Port Authority Management Services with the Transport Authority.

The PetroCaribe Development Fund is to be folded into central government, which the IMF says is due to happen by next March. The pending changes for PetroCaribe were reported by the Financial Gleaner in July, and there was some expectation that its resources could end up being administered by the finance ministry.