Thu | Apr 19, 2018

EDITORIAL - Cabinet getting on track

Published:Wednesday | January 16, 2013 | 12:00 AM

They didn't accomplish as much as they should have, but enough for us not to insist that the Cabinet head back into a special session to get the job done.

We now know that the International Monetary Fund (IMF) wants the Government to be more aggressive about its primary surplus. The target for the next three fiscal years is now 7.5 per cent of gross domestic product (GDP), rather than 6.3 per cent.

We also know that the Government is negotiating some kind of debt-amelioration programme with its domestic creditors.

It has also been acknowledged that these demands will require, among other things, the imposition of new taxes and wage restraint in the public sector - which we already know.

We were also told that the Cabinet unanimously endorsed, and was on board with, the economic support agreement being negotiated with the IMF by the finance minister, Peter Phillips.

"The Cabinet is united in its commitment to take bold actions and do whatever is necessary and prudent to arrive at an agreement that is in the best interest of Jamaica, given our particular circumstances," said Prime Minister Portia Simpson Miller.

That declaration was perhaps the single most important thing to emerge from last week's retreat of ministers. For if indeed the administration has assumed full ownership of the adjustment programme, maybe the Government can seriously get on with what it should already be doing: implementing the measures and having its best salesperson, Mrs Simpson Miller, explaining their necessity to Jamaicans.

What needs to be clearly understood is that Jamaica is not being forced into these adjustments because other people are nasty and wicked.

The fact is that we have been, for a long time, imprudent borrowers who have run a national debt, which, at upwards of 140 per cent of GDP, has long since been unsustainable. The Government uses nearly 60 per cent of its Budget to service the debt.

Forced into hard decisions

We used to mask the severity of the crisis by borrowing to stay afloat, but there are not too many people now around who are in a position to lend, or are willing to do so. We are being forced into hard decisions, such as spending less on wages for government workers, having them contribute to their pensions, collecting more taxes from more people and insisting that the public bureaucracy operate with greater efficiency.

These are politically tough things to do, especially for a populist government whose philosophy is fully embodied in a charismatic leader who may not wish to be the bearer of bad news.

Mrs Simpson Miller, who among current politicians possesses an unparalleled skill to communicate effectively with the majority of Jamaicans, may have crossed a psychological barrier where she is ready to lay down the cold, hard facts to people. That is long overdue.

Her Government has two other urgent tasks.

It must now set out clear time frames for the implementation of its programmes, while articulating a broader, but coherent economic strategy which will feed off these reforms.

For, as Mrs Simpson Miller has said, an IMF deal is not an end in itself, but a means to assist our economic recovery.

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