When the Finance Minister Audley Shaw closes the Budget Debate, he will try to complete the effort by Prime Minister Golding yesterday, cleaning up what has been an exceedingly sloppy - amateur even - Budget process.
The shame is that the time-wasting, enervating exercise of the past fortnight ought not to have happened. Not with an administration that spent long years in Opposition, critiquing its predecessor's approach to governance and promising a new clarity and broader effort at engagement once it assumed office.
Given Jamaica's economic situation, the Budget process of any government is bound to be difficult business. It would be, inevitably, harder this year, given the severity of global recession and the concomitant fallout, collapse of the mining sector, a weak market for tourism and a slow-down of remittances.
Budget deficit
It clearly does not help that Jamaica has a national debt that is nearly 130 per cent of the value of the annual output of goods and services or that the Government, in the last fiscal year, ran a deficit of nearly seven per cent of GDP, and that global credit markets are not particularly receptive to its entreaties. Or, to anyone else's, for that matter.
So, the $24-billion tax package - Shaw offered a $6-billion give-back by raising the threshold for personal income tax - was, in the event, hardly surprising or unexpected. Indeed, the minister's imposition of an $8.75 tax on a litre of petrol passed relatively easy, considering taxes on petrol has in the past tended to be a trigger for street protests.
But it seemed too much to expect that the administration could have pulled through the exercise without the embarrassing blunders that have characterised a significant portion of the process, the result, apparently, of both ignorance and arrogance.
Widening GCT net
The clumsiness is particularly evident in how the Government handled widening the net of the general consumption tax (GCT) to capture a greater range of goods and services. Minister Shaw went to Parliament with a list of goods and services that was incomplete and was caught out by his opposition shadow, Dr Omar Davies. Moreover, the Government failed to meet promised deadlines to produce a final list and was even this week thrashing around over what books would be subject to the tax. Similarly, the Government imposed a wage freeze - which does not really address the problem of overstaffing and efficiency - in the public sector, without full engagement of the unions with which it has contracts.
Part of the problem is that the administration underestimated the scale of the global crisis and at the outset attempted to sugar-coat its likely effect on Jamaica. It got caught. But even then, it might have recovered.
This newspaper, for instance, recalling the suggestion of the Moses report after the fuel-price riots of a decade ago, urged on the Government a wider consultation on the Budget as envisaged by that committee. We also suggested that it might be wise to postpone the Budget Debate and engage the Opposition and others in consensus-building discussion within the rubric of the Vale Royal talks.
It is still not too late, we feel, to similarly engage. Budgets, after all, are not set in concrete.
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