Unsolicited advice on the 2009-2010 budget
Published: Friday | March 20, 2009
R Anne Shirley
In approximately three week's time, you will be laying the Estimates of Expenditure for the upcoming fiscal year 2009-2010 on the table of the House of Representatives. This will mark the start of one of the most eagerly anticipated budget deliberations in independent Jamaica. And as you prepare for the sittings of the standing finance committee and your subsequent opening presentation in the Budget Debate, I would like to make the following suggestions for your consideration:
Resist the temptation to continually refer to the 1980s and the 18 years of the previous PNP administration: Just state the raw facts of the situation that the nation now faces and outline clearly the medium-term projections that underpin your budget. In this regard, please be bold enough to state upfront the average interest rates and the inflation rate projections on which the 2009-2010 budget is predicated.
Make the Estimates of Expenditure user-friendly: Last year's was not. It would be good if the new financial secretary could put her own stamp on the presentation of the estimates and the documents accompanying your budget presentation, by ensuring that these include detailed notes which will assist parliamentarians and the general public to understand the various line items presented. This is particularly important in the Estimates of Expenditure for the Ministry of Finance in relation to the repayment of debt obligations, the bringing on to the books of the central government, off-balance sheet transactions from public bodies such as the Jamaica Urban Transit Company (JUTC), the Sugar Company of Jamaica (SCJ) and Air Jamaica, and the provisions for outstanding wage settlements.
Each year the government presents capital expenditure estimates which invariably get drastically cut in the ensuing supplementary estimates as the rosy revenue projections do not materialise. No one believes that the annual Capital A and Capital B projections are credible anymore. So, it would make sense to be as conservative as possible in stating this year's capital expenditures.
The revenue side
On the revenue side, it will be tempting to suggest that the Government will be able to achieve revenue receipts that will be similar to or greater than those achieved in fiscal year 2008-2009. I urge you to present the raw, unvarnished facts: There can be no rosy revenue picture for the next twelve months, and no silver lining behind the dark clouds looming. A tax package is inevitable. However, you need to use your considerable communication skills to sell the various tax increases to the general public. And even though the prime minister (PM) will expect you to leave the announcement of the 'goodies' until he makes his contribution in the Budget Debate, it will be important to spell out the tax concessions and some of the safety net measures that will be provided for the most vulnerable in the society in your opening presentation. At least give a hint about what we can expect to hear from the PM such as the proposed national education fund, and the consolidation of professional job functions in the public sector.
An open letter to the Minister of Finance
R Anne Shirley, Business Writerrenee.firstname.lastname@example.org