Durrant Pate/Contributor

Finance Minister Fayval Williams has poured cold water on the Opposition People’s National Party budget proposals costing it $48.8 billion and declaring them not credible.

She stopped short of calling the proposals and promised give-backs, articulated by Opposition Leader, Mark Golding and the party’s Spokesman on Finance, Julian Robinson, a “sham budget“. In closing the 2025/2026 Budget Debate in Gordon House Tuesday evening, Williams hinted that the cost would have been more than $48.8 billion had she put every single PNP budget promise on the list.  

According to her, the Opposition is in the red when you add the cost of their promises. “They would have trampled on the Fiscal Rules, the same ones they told us they codified in law, Madam Speaker, you don’t see red ink yet. We have an obligation to pay $177 billion five hundred and thirty-three million dollars of interest payment. This is immovable! “

Ability to meet Jamaica’s interest payment 

She said in the government’s budget, the incumbent administration can make the country’s interest payment and have $780 million left, as a fiscal balance surplus, “a small surplus but a surplus and it sure beats the many years of deficit spending after deficit spending that the Opposition had when they were in government“.

She boasted, “Without budget, we can go to the financial markets and borrow to refinance the $162,746 billion of debt that will come due during FY2025/26. We will borrow less than is coming due! On the Opposition side, their Implied Budget cannot meet the interest payment! They would run a huge fiscal deficit of $204 billion!”

She jeered the Opposition, saying the PNP “went partying with the rent money… This fiscal deficit that the Opposition would run with all the give-ups and goodies violates the fiscal rule. It would send a shock wave into the financial markets: those with money would run to convert their JAD to USD, the dollar would fly, interest rates would go sky high, bond prices would tumble, the balance sheet of the financial sector would be severely weakened, instantaneously.”

This would be the case given that the financial sector has large holdings in government bonds and much of the bonds would be marked-to-market, meaning the financial sector would have to write down the value of their bond holdings.

FINSAC 2.0

Within no time, Williams declared that the Bank of Jamaica would have hiked interest rates to try to slow down capital flight. “Madam Speaker, I am not exaggerating, it would be FINSAC 2.0,” she opined.

However, the Finance Minister emphasized that under this budget that her government has put forward, Jamaica can go to market and borrow $162.746 billion to pay off that same amount of debt, which is called a rollover in financial terms. 

“We can do that because investors trust our budget. The Independent Fiscal Commission said our budget is credible and our budget is sustainable. We have indicated strongly that we will not ‘run wid it’ in an election year and we put forward a budget that when subject to interrogation is not a run-wid-it budget by any stretch of the imagination,” she told the parliament.

The minister reiterated that the Andrew Holness administration remains faithful to its commitment to continue fiscal prudence despite this being an election year with its many demands. She argued that given the implied budget of the Opposition with a thorough interrogation, she would deem it not credible. “If the Oppositions want to refute this claim that their implied budget is not credible, then let them put forward a Budget that can be interrogated… I say to the Opposition, Jamaicans deserve answers as to what kind of a budget the Opposition would have in an election year.”