First Supplementary budget to be tabled later this month

Finance Minister Dr. Nigel Clarke has responded positively to the government’s over-performance in tax collections for the first four months of the 2021/2022 fiscal year.

As a result of the over-performance, Dr. Clarke announced that a first supplementary budget with planned increases in funding for the COVID-19 fight will be tabled later this month in parliament. In a statement today, Dr. Clarke reported that, “the Government of Jamaica’s (GOJ’s) fiscal operations over the four month period April –July 2021 generated a primary balance surplus that exceeded the budgeted balance by $26.4 billion.”

He added that the factors that contributed to this primary balance performance included actual revenues exceeding budgeted revenues by $17.3 billion while actual expenditure was less than budget by $7.3 billion. “It should be noted, however, that an underperformance of expenditure at a point in time does not reflect a reliable source of fiscal savings, as the expenditure may simply be delayed,” the Finance Minister explained.

According to Dr. Clarke, “the robust revenue performance reflects the much higher than anticipated GDP growth, recently projected by the Planning Institute of Jamaica at 12.9% for April – June 2021, as compared with the prior year, as Jamaica commenced its economic recovery from the initial economic impact of COVID-19 in FY 2020/21.”

First supplementary budget being crafted

Given this higher than programmed performance of revenues, the Government is currently in the process of formulating the first supplementary budget through which it will address critical needs of the country that have emerged since approval of this year’s budget including expenditure pressures brought on by the rise in the intensity of COVID-19 pandemic.

The Finance Minister emphasized that, “in particular, this first supplementary budget for FY 2021/22 will address crucial financing requirements of the health sector, which are significant, as the Government continues its efforts to reduce the health impact of the pandemic on the population, as well as more targeted support for vulnerable populations among many other areas of acute expenditure needs at this time.”

He anticipates that the first supplementary budget will be tabled in Parliament by month end.