BUDGET BRIEF: Expenses Total J$612 Billion with Debt Repayment being J$198 Billion

Debt Repayment, Wages & Salaries, & Interest Expenses Hog the 2012/13 Budget

It’s that time again for the budget. If you haven’t been keeping up, dton’t know what to look for, or dont care, well continue reading. We will try to keep you up-to-date.

Please see below a couple paragraphs from an analysis released by JMMB.

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The Government of Jamaica (GOJ) recently tabled the estimates of expenditure for fiscal year 2012/13. Total budgeted expenditure for 2012/13 amounted to approximately J$612.4Bn, of which the re-payment of debt accounts for J$198.2Bn. Of note, is the significant increase (from J$6.1Bn to J$18.3Bn) in money allotted for liability management. At the standing finance committee the Minister of Finance outlined that the liability management program is primarily directed at facilitating a smoother debt maturity profile. Housekeeping expenses accounted for approximately J$90.6Bn, wages and salaries J$147.8Bn, interest expense J$136.5Bn and capital expenditure J$39.3Bn.

Jamaica's Debt Expense continues to remain significantly high - Picture from The Gleaner

The report continues,

Total expenditure grew by approximately 15.2 per cent, which reflected mainly a 54.2 per cent growth in money allotted for debt repayments. Expenditure before debt repayments expanded by only 2.7 per cent, capturing a 6 per cent growth in wages and salaries, a 1.0 per cent growth in housekeeping expenses and a 13.1 per cent increase in interest expense, offset somewhat by a 26.3 per cent reduction in capital expenditure.

Given the expenditure numbers put forward by the minister, it is inevitable that questions will arise regarding how we will finance the expenditure and what sort of deficit target is likely.

Stay tuned, we will follow-up and try to break down the numbers.

What do you think about the budget so far?