Dr Nigel Clarke, Minister of Finance and Public Service.
The Government of Jamaica has been forced to cut spending for the 2020/21 fiscal year in light of the revenue shortfall triggered by the ongoing COVID-19 pandemic.
The spending cuts, which are outlined in the Third Supplementary Estimates, were tabled in the House of Representatives on Tuesday by the Minister of Finance, Dr Nigel Clarke, total $3.5 billion.
Of this amount, $1.5 billion is on the capital side while $2 billion is on the recurrent or housekeeping side.
This means that the overall budget which stood at $853.83 billion has been reduced to $850.24 billion.
The finance minister explained that the reduction was a combination of cuts in expenditure, the shifting of payments and expenditure increases. But, he stressed that even amidst the ongoing pandemic, the government was focused on keeping the economy humming.
Prime Minister Andrew Holness (File photo)
Prime Minister Andrew Holness has indicated that the Government will likely soon have to table a Third Supplementary Estimates for the 2020-2021 fiscal year to cope with the economic fallout from the COVID-19 pandemic.
Since the first case of the coronavirus was confirmed in Jamaica in March, resulting in a partial shutdown of the economy, the recovery has been slow, and projections are that it could take several years for Jamaica and the rest of the Caribbean region to get back to pre-COVID-19 levels.
The Planning Institute of Jamaica (PIOJ) is projecting that the economy will contract in the range of 12 per cent for the current fiscal year, with 11 per cent in the October to December quarter. It contracted a whopping 18 per cent in the April to June quarter.