Thu | Apr 2, 2020

CARICOM snubs Ja’s pitch for budget cut

Published:Friday | February 1, 2019 | 12:22 AM

Jamaica has told its Caribbean Community (CARICOM) partners that it can’t afford, beyond this year, to continue paying 23 per cent of the Community’s EC$56 million (US$20.7 million) budget and has asked for a new formula that would lower the rate of its annual contribution to the Community.

During a January 10 video conference, CARICOM’s budget committee members largely rejected Kingston’s complaint, saying that although the data on which the assessments are made may be outdated, the funding formula itself was in line with global best practices and should be kept.

The officials, however, kicked the matter upstairs for resolution by the Council of Ministers, the highest decision-making body outside of meetings of the heads of government, who are expected to be called upon for a final decision.

Requests for comment from Jamaica’s foreign minister, Kamina Johnson Smith, who has responsibility for CARICOM affairs, have not been answered.

This year, Jamaica is assessed for approximately EC$13 million, just over half a million less than Trinidad and Tobago, the largest of CARICOM’s 15 full member states, and is required to contribute 24.1 per cent of the Community’s annual budget.

But at a budget committee last December reviewing the secretariat’s proposed expenditure for 2019, Jamaica’s representative, Ambassador Alison Stone Roofe, the foreign ministry’s undersecretary for bilateral, hemispheric, and regional affairs, complained that Kingston carried an unfairly heavy burden for CARICOM’s budget and laid a series of formulas for consideration.

All would lead to Jamaica, as well as Trinidad and Tobago, paying less. But Jamaica’s preferred choice was one that would shift contributions away from the size of a country’s economy to one based on a series of weighted variables such as debt-to-GDP, per-capita wealth, and a country’s tax earnings. Contributions by a single country would be capped at a maximum of 21 per cent of the Community, which would mean that Jamaica’s contribution would automatically be lowered by at least two percentage points.

Roofe asked that the proposals be analysed by a task force for review at the January meeting, where Kingston, again, didn’t get much joy.

“The meeting was generally of the view that the current methodology and formula used to determine member states’ contributions should be maintained, while the data used should be updated,” a report prepared for the Council of Ministers observed. “It was also brought to the attention of Jamaica that when the existing formula was applied to current data, Jamaica’s contribution would be reduced.”

The reference to a reduction was the 26.6 per cent of the Community’s bill Jamaica paid up to 2010 prior to a review of the system by a Trinidadian management and financial consultant, Osborne Nurse, who recommended that the data upon which his formula worked should be addressed every three years. That hasn’t happened, a fact that the January review meeting agreed needed to be attended to.