HAVING SELECTED her Cabinet, her first duty as new Head of Government, Prime Minister Portia Simpson Miller faces a number of economic issues - some old and some new - that demand speedy resolution.
First is the impending budget. Already there are definite expectations that the new budget will show some signals of increased attempts to wrestle with the social agenda.
This is so even with the retention of Dr. Davies as Minister of Finance and the realisation that the current debt-servicing ratios are a major constraint to expanded social sector spending.
It is possible that the new budget could contain increased micro and small business funding facilities that would be a pragmatic short-term solution in this regard. This is an expectation afoot in the wider public that the new administration will have to address.
A deeper issue is that with the Prime Minister having given clear signals at the most recent People's National Party's National Executive Council meeting that early elections are near, there are concerns that this would lead to overspending and overshooting of fiscal targets.
Finance Minister Davies, in anticipation of this concern among his critics, has already said that this is not likely. But with memories of the last national elections still fresh in many minds, this assurance will be taken with a grain of salt, and the likelihood of election overspending will remain an area of concern.
An even more immediate concern facing the new administration is the expiration of the memorandum of understanding at the end of March. A likely result is that public sector workers will try to play catch up with the increased inflation rate of the past two years. This has tremendous implications for the public sector wage bill and reinforces some of the real budgetary constraints that will be faced.
Already the Jamaica Teachers' Association has rejected Government's wage offer on the table and with the industrial climate heating up, this is unquestionably a challenge for the administration.
Then there is the formidable crime problem. The National Security Ministry will continue to make a major claim on the budget as the crime problem remains largely unabated. This will reduce the administration's ability to significantly increase social sector spending.
On the positive side a case can be made that given the euphoria evident with the ascendancy of the new Prime Minister and the administration's own promise of accountability and performance, then the social capital existing in communities could be tapped in initiatives aimed at crime fighting,
In fact, were the new administration to match its rhetoric with action, it would provide an environment in which the issues mentioned above could be better tackled in an atmosphere of compromise and consensus. This could also serve as a catalyst to increased output and an expanded GDP.
This is not as idealistic as it sounds as many would argue that this is the stuff of which enlightened leadership is made.
THE OPINIONS ON THIS PAGE, EXCEPT FOR THE ABOVE, DO NOT NECESSARILY REFLECT THE VIEWS OF THE GLEANER.
