The Finance Minister Dr Peter Phillips is to table in parliament soon, a Supplementary Budget reflecting a cut in public expenditure.
The administration has just over two months to go before the current fiscal year ends on March 31.
“We cannot live above our means any longer,” Phillips declared yesterday at a Mayberry Investment Forum at the Knutsford Court Hotel in New Kingston.
However, according to the minister, the adjustments will be made in such a way to protect the most vulnerable in the society.
He also promised that the Government will be careful in the way it goes about revising the Budget.
“In the present circumstances, given the failings of the previous administration, maintenance of fiscal stability will involve expenditure cuts in the short term,” he said.
“There will have to be expenditure cuts to compensate for declining revenues. We are determined not to squander the present opportunity to put things right once and for all.”
However, Phillips acknowledged that expenditure cuts were not a sustainable medium to long term measure to finance the operations of the Government.
"We will be required to identify opportunities to generate increased revenues, which must be in the context of the promotion and inducement of growth in the Jamaican economy," he emphasised.
In April last year Audley Shaw, the finance minister at the time, tabled a $544.7-billion Budget for the 2011/12 Fiscal Year.
But in August, Shaw tabled a revised spending plan reflecting an additional $2.1-billion net increase to the budget he presented in April.
The adjustment pushed the Budget to $546.8 billion.
The revision became necessary to account for a $4.4-billion increase in spending on the recurrent side and a $2.4 billion cut in capital expenditure.
This was because revenues were coming in lower than projected while expenditure had to be increased to settle the protracted wage dispute with public sector workers.