Stokes gives financial council thumbs up but bats for safeguard
Dr Adrian Stokes, president of Scotia Jamaica Life Insurance, has endorsed the establishment of an independent fiscal council (IFC) to strengthen Jamaica's fiscal responsibility framework, while at the same time offering recommendations for the entity's successful operation.
Finance minister Dr Nigel Clarke recently indicated the Government's intention to establish an independent fiscal council. It is a permanent, non-partisan institution created by legislation and staffed by experienced and technically proficient persons to promote economically sustainable fiscal policies across political cycles.
Speaking on Wednesday at a business conference held by the University of Technology western campus' school of business administration at the Iberostar Rose Hall Resort in Montego Bay, Stokes said that the proposed IFC, while a good idea, must be properly instituted.
"The IFC is something I endorse, but it has to be properly constructed. Left to itself, the Government cannot credibly commit to fiscal prudence. Hence, they need a device to signal to the market that they are willing to be restrained going forward," argued Stokes.
"There should be no doubt about the IFC's legal independence and to whom the IFC is accountable," continued Stokes. "One recommendation I will make is to make it report directly to Parliament, and regular meetings should be had with specialised committees like the PAAC [Public Administration and Appropriations Committee]."
Stokes further said, "The budget of the IFC must be set by Parliament with strong safeguards. If there are no safeguards around the budget, the IFC effectively loses its independence. There should also be proper legal access to relevant information in a timely manner. Quarterly public updates on the work of the IFC should also be enshrined."
In announcing the establishment of an IFC, the finance minister said that experienced international experts had been procured to help design the entity.