Briefing | Budget expenditure under microscope
How does the Budget break down?
This year, the Budget has expanded by approximately 20 per cent relative to last year. Total budget expenditure is estimated to be approximately $710 billion. The revised expenditure last year appears to be $12.8 billion more than budgeted, an improvement on the 2015/2016 fiscal year when the revised budget was $166.5 billion more than projected. In most cases, the Government will end up spending more than budgeted if it continues on the same trend. Last week, the Government outlined the estimates of budgeted expenditure to be approved by Parliament for the 2017/2018 fiscal year. The figures are preliminary and are subject to change.
Notably, estimated expenditure for loan interest payments and debt amortisation have increase to approximately $172.5 billion compared to little over $86 billion for 2016/2017 financial year (FY).
Total recurrent expenditures for the 2017/2018 FY are estimated to be $484.9 billion, up from $459.379 billion for 2016/2017 FY. Total allocation for capital expenditure appears to have increased this year after falling significantly over the past two years. The Ministry of Economic Growth and Job Creation are allotted $240 million more than the $9.1 billion allotted for 2016/2017.
How have recurrent expenditures for the ministries changed?
Total recurrent expenditure to the Ministry of Finance and Public Service (formerly the Ministry of Finance and Planning) for 2017/2018 FY is little over $13 billion more than the $194 billion approved last year. Total recurrent expenditure for the Ministry of National Security is $2 billion less than the $58.5 billion approved last year. The office of the Prime Minister is budgeted to receive relatively the same allocation as it did last year.
Recurrent expenditure for the Ministry of Education, Youth and Information (formerly the Ministry of Education) is $5 billion more than the $91.7 billion allotted last year. The Ministry of Science, Energy and Technology are allocated $1 billion less. Last year, the allotment amount fell by 2.6 billion. Allotment to the Ministry of Transport and Mining is approximately $2.7 billion, $500 million less than last year.
The Ministry of Industry, Commerce Agriculture and Fisheries and Department has seen no change in their allotment of $5.6 billion in total for recurrent expenditure from last year to this year. Recurrent expenditure for the Ministry of Culture, Gender, entertainment and Sports is an estimated $3 billion, up from $500 million allotted last year. The Ministry of Local Government are estimated to receive $1.9 billion less than it received for the 2016/2017 FY.
How have the allocations for Capital Expenditure changed?
The newly formed Ministry of Economic Growth and Job Creation has been allotted an estimated $50 million more this year over last FY for capital expenditures. The Ministry of Finance and the Public Service has been allotted approximately $175; $ 89 billion more than last year. Ministry of National Security is to receive $2 billion less than the $5 billion allotted in the 2016/2017 FY. Allocations to the Ministry of Justice are approximately $130 million more than the $293 million allotted last year. The Office of the Prime Minister is budgeted to receive $354 million more this year for capital expenditure. The Ministry of Industry Commerce Agriculture and Fisheries and their department are to receive $1.1 billion less than $2.6 billion for capital expenditure for the 2016/2017 FY. The ministry of Science, Energy and Technology are allotted $33 million less than the $285 million it was allotted last year.
What about education and health?
The Ministry of Education, Youth and Information is budgeted to receive $50 million less than it did last year for capital expenditure.
The Ministry of Health is to receive relatively the same amount from capital expenditure A to what it received last year. This year, similar to last year, health has been a significant issue; public health care must continue improve across the island.
How effective is the Budget?
Overall this year, other than debt-servicing payments, the Budget has not change significantly. Lack of fiscal space has limited the scope for capital expenditure expansion across the island. Fiscal policy should continue to coordinate with government legislation to facilitate growth in output. If Jamaica wishes to take advantage of knowledge economy, it must be able to establish the right linkage between education, research and development and productive activity.