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Jamaica News - Real Estate - Finance (April 01, 2005)
Davies tables $346.3-billion budget
A tight budget, with the total just more than $18 billion above the total expenditure for 2004/2005, was yesterday tabled in the House of Representatives by Minister of Finance and Planning Dr Omar Davies.

The estimates indicated government's intention to meet its deadline of a balanced budget in 2005/2006, which begins today. Although education and national security got some additional support, there were severe cuts, especially in health, local government and telecommunications.

The figures showed estimates of $186.4 billion for recurrent, or housekeeping expenditure and $159.8 billion for capital expenditure making a grand total of $346.3 billion. The 2004/2005 budget ended up at $328 billion.

The Ministry of Finance and Planning, as usual, ended up with the bulk of the funds with $104.4 billion in recurrent allotment and $146.4 billion in capital funds. Most of these funds will be used to pay debt, or compensate employees, including $105 million to the staff of the newly created Financial Investigations Division of the ministry.

There was an allocation of $485 million for housing assistance to persons adversely affected by Hurricane Ivan, $28 million to Kaiser Bauxite Company for land restoration. Approximately $1.6 billion, which was added for contingencies to cover any additional expenditure which may arise during the year.

The figure for repayment of loans for public sector entities went up from $64.9 billion to $78.7 billion, while that for repayment of loans from commercial banks dropped from $1.6 billion to $665.8 million.

There was a loan of $677 million to the Jamaica Cricket 2007 Limited for the 2007 ICC World Cricket Cup. The loan is a part of a US$28-million loan to the company for the renovation of Sabina Park by 2006/2007.

Education, Youth and Culture got $34 billion for recurrent spending, compared to last year's $30 billion, and $3.4 billion for Capital A projects which are financed by the Government of Jamaica, including $245 million to cover a deferred financing arrangement for a project to improve the quality of educational facilities in Westmoreland, Hanover, St James and Trelawny which falls due this year.

The new Early Childhood Commission got $53 million, of which $38 million were to purchase goods and services. There was $72 million for some 29 infant schools and $849 million for community basic schools, islandwide. Nutrition Products Limited had a huge increase in funding from $424.7 million to $1.6 billion, including $1 billion to cover cash grants to students attending designated schools under the traditional programme and those under the PATH programme.

The Jamaica Cultural Development Commission (JCDC) had its budget increased from $122 million to $191 million, mainly by a $53 million increase in funding for the celebration of national events this year.

In the Ministry of National Security, there is $19.6 million to finance the by-election scheduled for April 13 in West Kingston, of which $10 million is to purchase equipment for the election which will be using the electronic voter identification system.

In the Jamaica Constabulary Force (JCF), there is $45 million more for criminal investigation, $145 million for auxiliaries including the Island Special Constabulary Force and $32 million more for its community relations section which includes the police band, the Centre for Investigation of Sexual Offences and Child Abuse, Dispute Resolution and other activities including police youth clubs.

The Jamaica Defence Force (JDF) got $3.4 billion of which $2.6 billion is for military services including the purchase of ammunition and maintenance of weapons ($346 million), $286 million for the National Reserve, $139 million for the air wing, $201 million for the coast guard and $510 million for engineering services.

The Correctional Services' adult institutions will receive nearly $300 million more in recurrent funds, with the bulk going to the troublesome General Penitentiary on Tower Street, Kingston to cover the compensation of its staff, rehabilitation of offenders and purchases of goods and services on a day-to-day basis.

Hardest hit by cuts, the Ministry of Health had its general administration budget cut from $327 million to $256 million, especially in terms of its standards and regulations funding, which covers grants to public bodies, the Pesticide Control Authority and the development and monitoring of standards, as well as its health service delivery. The Southeast Regional Health Authority (SERHA), which covers Kingston, St Andrew, St Thomas and St Catherine with 88 health centres and nine hospitals, had its recurrent funds slashed from $1.4 billion to $72 million of which $56 million is for emoluments for employees.

The government, however, indicated that it expects the health facilities to collect $1.4 billion in user fees paid by the public this year, of which the SERHA was expected to earn $573.4 million.

In the Ministry of Local Government, the Jamaica Fire Brigade's recurrent budget was cut from $1.7 billion to $1.5 billion, the grant for administration of fire stations was slashed by more than $200 million, the grant for maintenance of fire hydrants cut by almost half to $4.8 million.

The postal service was severely hit by a cut in its recurrent budget from $12 billion to $1 billion, especially in terms of postal administration and postal stationery and printing services where there were severe cuts in funding for compensation for employees, public utility bills and purchases of goods and services.

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