Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697807068677.pdf (Jamaica)
BUDGET DEBATE PRESENTATION TUESDAY APRIL 20,2010 THE HON.

BRUCE GOLDING, M.P.
PRIME MINISTER Table of Contents Positioning for Growth • • • • • • • • • • • • • • • • • • • • • • • • • • • Budget context............................................................................................. 3 The "spend more" option ............................................................................... 4 Forging our way through tough times ............................................................... 6 Survey of Living Conditions ............................................................................ 6 Hearing the people's cry ................................................................................ 7 PATH .......................................................................................................... 7 School feeding programme .............................................................................. 7 Abolition of tuition fees ............................................................................... 7 Abol ition of hospital charges ........................................................................ 7 Dialysis Treatment...................................................................................... 8 National Insurance Scheme .......................................................................... 8 Increased NIS benefits ................................................................................. 9 Increase for Government pensioners ............................................................... 9 I m proved N HT benefits ............................................................................... 1 0 Outstanding payments to public sector workers ................................................. 11 Swimming against the current to position ourselves for growth.
... ... ...... .... ...... .... 12 Public Sector Transformation ......................................................................... 13 Privatization .............................................................................................. 13 Air Jamaica ............................................................................................... 13 Sugar ....................................................................................................... 14 Clarendon Alumina Production ...................................................................... 15 Norman Manley International Airport ... ......... ......... .... ... .............. ................... 15 Port of Kingston..................................................................... ...... ...... ........ 16 Other legacy liabilities ...... ... ...... ..... .... ..... ... ...... ......... ...... ....................... .... 16 Positioning for growth.............................................................. ...... ............. 16 Partnership for transformation....................................................................... 18 Micro, Small & Medium Enterprises .... ...... ... ... ............ ... ................................ 19 Positioning (or Growth Table of Contents ... cont'd • • • New investments ....................................................................................... 19 Bauxite and alumina.................................................................................. 19 Energy diversification ................................................................................. 20 • .
Petrojam refinery upgrade......... ...... ................. ...... ......... ................... ......... 20 • Roads....................... .................. ....................... .... ... ......... ...................... 20 • Water ..................................................................................................... 20 • • • • • • • • • Foreign Affairs .. ...... .............. ..................... ............................................... 21 Education ................................................................................................ 21 Juvenile Correctional and Remand Facilities.................................................... 22 Fighting corruption.................................................................................... 23 Crime ..................................................................................................... 23 Justice ............. .... ................. .... .......... ...................... ...... ......................... 26 Transforming the social order.. ........ ...... .... ... ...... ...... .... .... .............. ........ ...... 26 I"'ational consensus..... ................ ... ............... ... ................... ......... ............. 27 Conclusion ..... ............... ......................... ................. .................. ............... 28 • Budget Context very Government, in presenting its ~dget, desi res to be able to do more ~~nd spend more.
Budget debates tradi­ for grand the occasion tionally provide announcements of projects and programmes to address every possible need, satisfy every important segment of the population.

For many people, that has come to be the stan­ dard by which a Government is judged and a budget is assessed.

A "good" budget is one that is loaded with goodies and a "good Government" is one that presents "good budgets".
The Leader of the Opposition spoke passion­ ately about the needs of the poor and vulnera­ ble and of the difficulties faced even by those who are not entirely poor but still vulnerable.

She is absolutely right.

I say, with absolute respect, and with no offence whatsoever intended, that she has no monopoly on com­ passion.

We know that many people are having it hard and there are needs to be met.

That is what budgets, year after year, have tried to do - spending more, trying to do more.
Our noble intentions were hardly ever deterred by the fact that our revenues were not sufficient to cover our spending.

We simply borrowed the difference and kept on borrowing the difference.

For the last 14 consecutive years, we have been spending more than our revenues can cover.

Up until 1995/96, our revenues and grants were sufficient to cover our recurrent expenses including interest payments.
We did have to borrow to meet our capital expenditure Positioning for Growth and the principal repayment on our debt but we didn't have to borrow to pay our bills.

I have noted that that was the year we said goodbye to the IMF.

Every year since then, we have piled up deficit on top of deficit with an accumulated shortfall of almost $480 billion.

Our recurrent expenditure has grown at a rate three times as fast as our revenues (76% vs 24%).
Yet, our needs, ostensibly the object of all these "good budgets" loaded with goodies have still not been adequately met.

We still have bad roads that need to be fixed, water supply systems that need to be upgraded, new schools that need to be built, poor people crying out for assistance.

We know that many people are having it hard and there are needs to be met.

We have lived a fiscal lifestyle in which we put on weight but we don't grow.

We accumulate fat but we build no muscles.


And as we put on more weight, the muscles that must bear that weight become weaker, the pressure on our heart becomes greater and we have difficulty in moving around.

In human anatomy, obesity is not a sign of good health; it is a silent killer.

In a country's fiscal anatomy, obesity is as lethal a killer.

It is in that context that this budget has been framed.
It is not the traditional budget promising to do more, spend more, leaving the revenues sputtering behind.

This year, for the first time ever, the budget is substantially less than last year~ and we have started to shrink the gap between what we earn and what we spend.

Positioning for Growth The "Spend More" Option The Leader of the Opposition says that is exactly the opposite of what we should be doing.
She way out of the crisis because we would have had to borrow every single dollar that we spent, digging ourselves into an even deeper says that "more developed countries and pro­ hole.

gressive governments" have been spending more in order to boost aggregate demand and As the data shows, the economy registered a that is what we should be doing.

The important 2.7% decline last year.

Unemployment rose difference is that those countries had built up from 10.6% to 11.4%.
That is a matter of real surpluses that they were able to use to finance concern to us.

The statistics are bland and the big spending to boost aggregate demand.

impersonal.

The impact on the people, the effect on people's lives is cold and harsh - peo­ I note with some interest that that was not the ple who have lost their jobs, the small traders position taken by the Opposition Spokesman who spend the day in the sun without making on Finance.
He pointed to the impact that the a sale, the struggling families that have to jug­ budget cuts would have but he didn't suggest gle between paying the rent and buying food.

that what we should do is spend more.

No one needs to dramatize for us the hardship We might have been tempted to do that as we have done in the past, so long as we could keep borrowing to pay for what our revenues could not cover.

When we got clobbered by the global recession, that game was over.
The fallout in bauxite, remittances, exports, rev­ enues, the financial markets changed that ball game.

We were facing a crisis of monumental proportions.

that people are going through.

We did as much as we could and it helped as it could.

What we couldn't do was to try to spend our way out of the crisis because we would have had to borrow every single dollar that we spent, digging ourselves into an even deeper hole.
The Minister of Finance has recounted the I neither begrudge them nor seek to deny them I know that this is grist for any Opposition mill.

strategies we used to head off that crisis - the their moment in the shade.
support we were able to mobilize from the multilaterals, the painful tax increases we had I also know it is no comfort to those who are to impose, the fiscal compression we had to sufferi ng but the performance of the economy apply, the necessary re-engagement with the last year must be put in perspective.

Is it not IMF and the strictures that come with that.
remarkable that in her two-hour presentation We weren't able to mount the massive stimulus even one mention of the global economic cri­ packages that some countries did.

We did as sis and its impact on Jamaica?

We are an island much as we could and it helped as it could.

but in this economic turmoil we are not an What we couldn't do was to try to spend our island unto ourselves.

the Leader of the Opposition did not make Positioning for Growth Let me use one illustration.
We don't consume tourism sectors.

Agriculture grew by 12.1 %, an one ounce of the bauxite or alumina we pro­ outstanding achievement in a time of weak duce; every grain of it is exported.

It accounts purchasing power.

In tourism, Jamaica led the for more than 50% of our total export earnings.

entire Caribbean with 3.6% growth in stopover When the global market for bauxite and alumi­ arrivals despite the global downturn.
I com­ na collapsed, three of our four alumina plants mend the work of the Minister of Agriculture were shut down.

One third of our export and the Minister of Tourism and the teams that earnings was wiped out last year, not to men­ they lead.

tion the substantial loss in revenues.

Of the 2.7% that the economy declined last year, The Opposition has attacked the budget as not bauxite and alumina accounted for 1.9% of it!
being credible and bases its assertion on the fact that our targets and projections had to be How we stack up with the rest of the world revised more than once or were not met.
If that Yes, our economy fell last year by 2.7% but, charge is to be upheld, it could not be confined despite the massive stimulus packages some to Jamaica; it would have to be directed at were able to mount, the economies of most many of the leading economies of the world countries of the world, also fell, many of them and institutions such as the World Bank and worse than ours did: IME They, too, would have to be declared as GOP Outturn 2009 (Selected Countries) not credible.
Jamaica Italy -5.1% • The World Bank, IMF and the Federal Reserve were all forced to revise down wards their GDP projections for last year ­ not just once but, in the case of the IMF, three times and two of the three still got it wrong.

Barbados -5.3% • We did not meet our revenue target last year.
It fell short by 10% but we did Spain Japan -5.7% Eurozone Antigua -6.5% Puerto Rico Mexico -6.8% Seen in this context, our 2.7% decline last year is nowhere as bad as it could have been and, for that, we must acknowledge the significant contribution made by the agriculture and increase revenue collections by 8% due, in part, to the tax increases we had to impose.

The UK, on the other hand, saw a fall in revenue collections of 8% and the US 14.6% as a percentage of GDp, the lowest in 50 years!
• Our fiscal deficit ended up at 10.9% due to the fallout in the economy but, in part, to payouts related to the debtexchange pro­ gramme.

But the deficit in the US was 12.9% and in the UK 11.8%.

Positioning for Growth • The number of unemployed in Jamaica rose may have appeared contemplative because the last year by 22%.

It rose by 35% in UK and 60% in the us.

• The Opposition highlights the fact that the public debt has grown by 55% in the last 2112 years.
It is a matter of deep concern for us as well.

But when a country suffers the kind of body blows that we have, even as you cut expenditure, you have to borrow to fill the gap.

Again, we are no different from country has never been thrown on such a bat­ tlefield before.

Yes, we have been through tough times and it is not yet over but with God IS help we have guided Jamaica IS economy through the worst crisis it has ever faced.

many other countries.


In the last 2112 years, We may not have communicated with the peo­ the national debt in the US has grown by ple as well as we should have because the heat 60% and in the UK by 55%, the same as us.

of the battle doesn't always allow for extended conversations.

We may be battered and In this unprecedented global crisis, not even bruised such is the inescapable toll of a fierce the most respected economists could see battle.
But our courage has never wavered; our through the storm with any accuracy.

resolve is firmer than ever, our troops are Forging our way through tough times All of what we seek to do, reflected in the structure of this budget, is part of a process.

We cannot change the fortunes of this country overnight especially in the face of the difficult times the global economy is going through.

We did not get into this predicament overnight and it wi II take ti me to get out of it.
Yes, we have been through tough times and it is not yet over but with God's help we have guided Jamaica~ economy through the worst crisis it has ever faced and this Government, the Ministers who work hard, the members on this side who support us have nothing to be ashamed of.

We may have faltered at times for the road has many dangers, toils and snares.

At times when the nation demanded immediate action, we advancing.
It was Winston Churchill who said if you are going through hell, don't pause, don't stop there, keep going.

We have kept going and victory is in sight.

The Minister of Finance, despite the detractors who pounced on him from the very day he took office, has done well.

He has faced the most difficult task of any Finance Minister and he and his team deserve our respect and com­ mendation.
Survey of Living Conditions The Opposition Spokesman on Finance ques­ tioned the delay in the publ ication of the Survey of living Conditions.

The delay is due to a variety of factors including the fact that periodically, as he knows, we do an extra large sample (in this case three times the normal size) which requires more time.

The SLC-2008 should be published in July and SLC-2009 is expected October.
to be ready for publication in Positioning for Growth Hearing the people's cry We have asked the people of Jamaica for their In 2112 years, we have tripled the allocation for the school feeding programme and doubled the patience and understanding.

We know how number of children who benefit.

tough it is especially for the poor, unemployed, low wage earner and even for the middle class.

We see them in our constituencies.


We talk to our Abolition of tuition fees We gave a commitment to abolish tuition fees helpers.

We know the difficulties they are facing.

in high schools so that no child would be kept out of school because his parents who have to Despite the tight fiscal constraints and our obli­ find the bus fare and school uniform can't find gations under the IMF programme, we have the school fees.

We have kept that commitment.


sought to provide support for the most vulnera­ ble by significantly expanding our social safety The Opposition Spokesman in Finance says net programmes.

The Minister of Finance has that we should reinstitute the cost-sharing pro­ already enumerated the figures but they are gramme so that those who can pay are made to worth repeating.

pay.
pay.

He says we should apply a means test to PATH We have more than doubled the allocation for the PATH Programme si nce we came to office and increased the number of persons receiving benefits by 50%.

We are going to create a new category of ben­ eficiaries for the very old or disabled, many of whom are not on the programme for varyi ng reasons including failing to qualify when the standard criteria are applied but who have spe­ cial needs because of their infirmity or disability.
The World Ban k has approved a grant of US$2.6 million funded by the Japan Social Development Fund to enable us to target this vulnerable group.

We estimate that some 10,000 persons will benefit through this inter­ vention.

School feeding programme Many children ofthe poor go to school without having had a proper meal.

Hungry children determine who can pay and who can't.

• How is that means test to be conducted?

• What means of validation will you use to determine who can pay?
• How much will you be able to collect from those and how much of that will be used to cover the cost of doing the means test?

don't recall hearing the Leader of the Opposition call for tuition fees to be reinstituted, yet, the Opposition Spokesman on Finance is calling for it.
Abolition of hospital charges We have kept our promise to abolish hospital user fees because when people get sick they must not be forced to stay home and die because they can't find the money to pay the hospital charges and although funds are tight, that commitment is here to stay.

It has posed challenges because more people are coming to the hospitals seeking medical cannot be blamed if they don't learn.

• attention.
• attention.

But is the Opposition concerned Positioning for Growth enough to figure out where they went to get because of the debt exchange programme, as attention when we used to charge fees?

he has claimed.

It first became so in 2004, We know the removal of user fees has put strain on the supply of drugs.

We have responded.

Since the abolition of user fees, we have doubled the allocation provided for the purchase of drugs for our hospitals.
We are sourcing cheaper drugs so that the money can stretch further to buy more drugs.

Tomorrow, the Minister of Health will be sign­ ing contracts valued at $2.3 billion for the pur­ chase of drugs representing a saving of more than $400 million on what it would normally cost us.

I have never heard the Leader of the Opposition call for hospital fees to be reinsti­ tuted, yet, the Opposition Spokesman on Health insists that it must be done.
Dialysis Treatment The Leader of the Opposition reminded me that we have not built the dialysis centres we prom­ ised.

Conditions have not yet allowed us to do that but we have increased the number of dial­ ysis machines from 38 to 63, so that more kid­ ney patients can receive treatment.

National Insurance Scheme The National Insurance Scheme is the lifeline for thousands of persons when they get old and can no longer work.
The Opposition Spokesman on Finance has expressed concern that the cost of NIS benefits as well as its con­ tribution to the National Health Fund and the NI Gold programme exceeds the inflows from NIS contributions.

That is so but not just long before the debt exchange.

The Government has taken the decision to increase the wage cap used in calculating NIS contributions from $500,000 to $1,000,000.
Interest income fluctuates with changes in interest rates and will decrease if there is a fall in interest rates whether that fall comes about because of a debt exchange or normal mone­ tary policy.

Even fixed-rate instruments can have a positive or negative effect on interest income depending on whether the interest rate prevailing at any given time is above or below that fixed rate.
The Government has taken the decision to increase the wage cap used in calculating NIS contributions from $500,000 to $1,000,000.

Although this will increase the value of contri­ butions and mitigate the reduction in interest income resulting from the debt exchange, the member knows from discussions we had at Jamaica House from May last year that this was planned.

The increase in the cap became necessary to restore the value that had been eroded by infla­ tion.

The cap was last increased in October 2003.


Inflation since then is 115%.

The new cap of $1,000,000 is still below the real value of what it was then.
There are issues of concern - the widening gap between benefits paid out and contribution inflows, the fact that people are living longer Positioning for Growth require more extended periods of pension pay­ • Other benefits including maternity allowance, ments and, importantly, the fact that persons employment injury, disablement and death who joined the scheme at the start of their benefits, funeral grants, old age grants, working life when it was established in 1966 invalidity grants, widows and orphans are now becoming eligible for pension.
grants wi" be increased by rates rangi ng from 11% to 33 1/2%.

The last actuarial review was done in 2005.

• Benefits under the NI Gold programme The next review is to be carried out this year such as payment for prescription drugs, and that will provide us with the basis for diagnostic procedures, dental and optical determining what changes need to be made to services will be increased by rates ranging ensure the sustainability of the Fund over the from 25% to 50%.
long term without diminishing the real value of the benefits to contributors.

The Fund, however, remains robust with a net asset value as at the end of February of $61 billion.

Increased NIS benefits NIS benefits were last increased in 2008.

The increased contributions arising from the lifting of the wage cap will enable us to increase the benefits to pensioners and other beneficiaries without impairing the value of the Fund.
It will also increase the flows to the National Health Fund which commands 20% of NIS contributions.

The increase in the wage cap from $500,000 to $1,000,000 will take effect on June 1, 2010.

NIS flat rate contributions payable by domestic workers, self-employed persons and voluntary contributors which has remained at $20 per week for many years will be increased to $50 per week effective June 1, 2010.

With effect from June 1, 2010: • Pension benefits payable under the NIS will be increased by 20%.
The details of the various increases are set out in a Ministry Paper which was tabled today by the Minister of Labour & Social Security.

The NIS provides for a pension eligibility age of 65 years for men and 60 years for women.

Typical pension schemes make no such dis­ tinction.

In the public sector, for example, the eligibility age for men and women is the same.

It is proposed to unify the eligibility age for NIS pension on a phased basis.
Commencing in 2011, the pension eligibility age for women will be increased by one year each year until it equates with that for men, i.e., 65 years, in 2015.

Increase for Government penSioners Government pensioners are not to be left out.

There are over 25,000 persons currently in receipt of Government pensions.
The adjust­ ments to the budget that the Minister of Finance sought during the Standing Finance Committee deliberations included a provision of $500 million for increases to Government pensioners this year.

There is a normal process of consultation with the Jamaica Government Pensioners Association before a final decision Positioning for Growth is taken as to how the increased amount is to the N HT for not less than 1 0 years and who be apportioned.
Those consultations will com­ mence shortly and the Minister of Finance will provide the details to the House in due course.

Improved NHT benefits The ability of NHT homeowners to meet their mortgage payments is a matter of concern especially at this time when they are faced with so many challenges.

First-time buyers find that even when they can manage the mortgage pay­ ment, they can't find the downpayment.
The NHT has approved the following new measures: (1) Reduced mortgage rates Mortgage rates will be reduced by 1 % across all four income bands: Income Current New Under $7,500 i 2% $7,500 - $1 0,000 4% $10,000 - $20,000 6% 1% 3% 5% Over $20,000 8% 7% I I I I I I (2) Reduced mortgage rates for new applicants 55 years & over There are many contributors past the prime of their lives who do not own a house and whose hopes of ever doing so are fading as they get older.

We must improve their chances.


Accordingly, first-time applicants who are fall in the 3%, 5% and 7% bands will qualify or a 2% reduction in their mortgage rates.

In other words, they will pay 1 %, 3% or 5% depending on their income band.

(3) Subsidy Programme The NHT will allocate 40% of its pre-tax surplus at the end of each quarter to provide subsidies to selected mortgage applicants who earn less than $1 0,000 per week and who have been contributing to the NHT for not less than 10 years.
The existing points criteria will be used in selecting applicants for this benefit.

(4) No downpayment for scheme units and serviced lots Qualified applicants for scheme units and serviced lots will no longer be required to pay the minimum 5% deposit.

They will, however, be required to pay the legal and professional fees associated with the mortgage agreement.
(5) Reduced interest rates on selected loans to developers In order to encourage private developers to build affordable houses for NHT beneficiaries, the interest rate charged on interim con­ struction loans will be reduced from 8% to 3%.

This will apply only in relation to two­ bedroom units delivered at a cost not exceeding $5.5 million and studio units not exceeding $3 million.

These loans will be for a maximum of three years.


(6) Deferred Mortgages There are many N HT contributors who can not buy a house because their income is not 55 years and over who have contributed to • enough to qualify them for the mortgage .

Positioning for Growth We will be introducing a Deferred Mortgage Appropriate adjustments will be made in cases arrangement whereby that applicant can of co-applicants.

qualify for a mortgage equivalent to 60% of the price of the house.
The remaining 40% There are various other changes in the Housing will be converted into a deferred mortgage Benefits Policy details of which are set out in the to be repaid or refinanced at scheduled Ministry Paper which was tabled earlier.

Some of stages in the life of the first mortgage.

This these measures will take effect as of May 1, 2010. is a limited benefit and will apply only to Others which require more detailed administrative 10% of the units in anyone scheme.
changes will become effective July 1, 2010.

This will apply to scheme units only.

It will In facilitating these changes, we must ensure expand the affordability of many NHT contrib­ that we don't impair the sustainability of the utors and enable them to purchase the house Trust.

When the higher-end mortgage rates they would not otherwise have been able to were increased in 2008, it was because the afford.
In effect, they will be able to buy part of average interest rate charged on NHT loans the house now, take possession of the entire were reduced below its cost of funds.

In order house and pay for the rest of it at a later date.

to ensure that we don't return to this untenable (7) Extended moratorium for Build-On-Own­ Land and Construction Loans Persons accessing BoL and construction loans are currently required to start repayment after 6 months.

This moratorium will be extended to 12 months.


(8) Increase in loan ceilings position, the interest paid on contributors' refunds will be reduced from 3% to 2%.

Outstanding payments to public sector workers Various groups of public sector workers have been agitating - not without cause.

There are monies owed to them that we know we have to The maximum mortgage loans allowable pay but we simply cannot find it at this time.
will be increased as follows: Type Scheme Units, • Open Market Current Ceiling New Ceiling Purchases & BoL i $3.5M $4.5M i Serviced Lots $1.2M $1.5M Construction Loans $2.3M $3.0M • Home Improvement Loans $1.2M $1.5M The amounts agreed but still outstanding for various groups of public sector workers total $13.4 billion, $9.4 billion of which was due to be paid this year and $4 billion over the two subsequent years.
These outstanding obligations represent commitments made before the deteri­ oration in our fiscal situation and the compres­ sion measures that had to be applied to contain it.

I The provision in this year's budget to meet these outstanding payments is only $2 billion, hence the dilemma that has led to unrest among some public sector groups.

We understand • Positioning for Growth their anxiety.

We have asked them to understand the predicament that the country is in.
mony and mutual respect for the good of the country for we are all servants of the people, whether elected or appointed.

We have had to freeze wages until we recover sufficiently... We cannot .•.

jeopardize the recovery programme or else all of us, not just the public sector workers, will suffer.

The Opposition has accused us of showing dis­ regard to public sector workers.

This is simply not true.

The Government has not been stingy or unreasonable.
As the Minister of Finance has already pointed out, we have increased the public sector wage bill by 50% in the last two years.

There cannot be anything stingy or unreasonable about that.

It is the retroactivity that we are grappling with and it is that that requires more money than we are able to find at this time.

We have had to freeze wages until we recover sufficiently.
Some countries like Ireland and Greece and even Turks & Caicos applied more severe measures by actually reducing public sector wages.

We cannot afford to jeopardize the recovery programme or else all of us, not just the public sector workers, will suffer.

There have been times when in the heat of con­ tentious discourse harsh words have been spo­ ken on both sides that have caused offence.
To the extent that I or any of my Ministers have been guilty of that whether in reference to teachers, nurses or any other group, we apolo­ gize and we recommit ourselves to working We are committed to finding an amicable way to resolve the impasse and, to that end I have invited the leaders of the respective public sec­ tor groups to a meeting on Thursday to see how, together, we can find a way that wi II enable us to move forward.
Swimming against the current to position ourselves for growth Apart from the context in which the budget is constructed, it is important to understand its purpose and the direction in which it points.

A criticism that has been made, not unexpect­ edly, is that the budget is not designed to stim­ ulate growth.

I challenge that assertion!

Budgets that continue on a path of recurring deficits are the enemy of growth.
Budgets that depend on ever increasing borrowing, crowd­ ing out private sector investment, driving up interest rates and making Government Paper the most lucrative business in town can neither stimulate nor sustain growth.
What the budget seeks to do is to make a par­ adigm shift, to replace fiscal disorder with a new sustained order of fiscal discipline, con­ tain Government spending, reduce borrowing, cut interest rates and wean money off the breast of Government Paper so that it will start chasi ng investments that wi II create jobs and generate growth.

We won't get there in one year.


Even as we embark on this programme of fiscal transfor­ with them constructively and in a spirit of har­• mation, we expect to end the year with a deficit Positioning for Growth of 6.5% down from almost 11% last year but and to be held accountable for his or her per­ firmly set to achieve zero deficit by 2014. formance in fulfilling those responsibilities and exercising that authority.
It will require more The Minister of Finance has enumerated the than just a change in management systems.

It important policy measures on which this trans­ involves a cultural change that will take time to formation is anchored.

There is no need for me be fully inculcated but we are beginning that to recite them here but there are two initiatives process.

on which I must comment.


Public Sector Transformation A major bugbear in doing business and investing - the things that are needed to facilitate growth and job creation - is the frustration posed by Government bureaucracy.

It is not as bad as some make it out to be but it is not anywhere as good as it needs to be.
It takes too much time to get things done, there are too many unnecessary procedures that have to be gone The privatization programme is critical for two important objectives, firstly, to relieve the burden of commercial activities that have drained the public purse and, secondly, to allow for private capital to make the kind of investment in these entities that the government is not able to make.
through, too many forms that need to be com­ Government is the biggest business in the pleted and too much time to get responses or country.

It is the most important business in the decisions on simple matters.

country and it must therefore become the most efficient business in the country.
The Public Sector Transformation Unit has completed its review of the structure of Government, how ministries, agencies and Privatization The privatization programme is critical for two functions can be rationalized for greater effi­ important objectives, firstly, to relieve the bur­ ciency.
The next phase involves determining den of commercial activities that have drained how best to deploy the available human and the public purse and, secondly, to allow for material resources to support the effective private capital to make the kind of investment operation of the structure.

The third phase, perhaps the most important, is in these entities that the government is not able to make.
The billions of dollars we have lost in these entities are part of what has caused us to to transform public sector practices to align be in the predicament we are in today.

responsibility, authority and accountability.

Our philosophy is for every public sector employee to be fully aware of what his or her responsibilities are and how they relate to our national goals, to have the requisite authority Air Jamaica I appreciate the sentimentality attached to Air Jamaica.
I, too, am proud of the staff of Air Jamaica - pilots, flight attendants, ground staff to effectively discharge those responsibilities and mai ntenance crew.

They are not to be Positioning for Growth blamed for the losses Air jamaica has racked The House will be fully informed of the details up.

of the agreement as soon as it has been con­ Ever since the deregulation of commercial avi­ cluded.
ation, the airline business has become a cut­ throat business and our throat has been cut Sugar We have already sold two of the five over US$l billion in accumulated losses.

It is Government-owned sugar factories.

Our just not possible to sustain these losses any attempts to dispose of Frome, Monymusk and longer.

Bernard Lodge have, so far, failed to materialize.


For the 2010 crop, the Cabinet has approved a similar arrangement with Tate & Lyle for the provision of 100,000 tons of sugar with prepayment of US$26 million this year and US$20 million next year to enable us to plant the crop and get the factories ready.
We have been able to continue operations at the three factories and preserve the jobs of 2,300 sugar workers through a financing agree­ ment with Eridania Suisse of Italy under which it made an advance payment of US$15 million against the delivery of 79,000 tons of sugar which was then used to plant the crop and pre­ pare the factories, thus requiring no subsidy or loan from the Government.
It would have been ideal to keep it in Jamaican hands but no credible offer was forthcoming For the 2010 crop, the Cabinet has approved a and every study that was done suggests that its similar arrangement with Tate & Lyle for the chances of success hinge on it being merged provision of 100,000 tons of sugar with pre­ with another carrier in order to achieve the payment of US$26 million this year and US$20 economies of scale that it needs to survive.
million next year to enable us to plant the crop Caribbean Airlines is committed to servicing the routes that are vital to jamaica's interests.

and get the factories ready.

The agreement is based on a reserve price of 0370 per ton and a 50/50 share of the profit from the final sale of They will fly these routes under the Air jamaica the sugar.

Tate & Lyle was selected because it flag at least for the initial period and under made a better offer than Eridania.
The sugar licence from the Government of jamaica.

workers can be assu red that for the next crop their jobs are safe.

We have made provisions in the budget to sat­ isfy promptly all our obligations to the staff of Air Jamaica, some of whom will be offered There is more encouraging news.

Renewed interest has emerged in acquiring these three employment by Caribbean Airlines.

factories.
factories.

Discussions with a potential buyer with strong financial credentials are well Our recurring losses in Air jamaica will finally advanced.

This would involve significant come to an end.

investment in factory capacity and the planting • Positioning for Growth of additional acreage.

It is not possible to make (Chalco), China's largest aluminium company a definitive announcement at this time.
I hope and has secured financing commitments from that the Minister of Agriculture will be able to the China Development Bank.

The sale is sub­ do so by the time he speaks in the sectoral ject to the inherent rights of Alcoa, our joint­ debate.

venture partner in Jamalco, which has a 90-day right of first refusal.
Representatives of Hong I wish to commend the Minister and the head Fan, Chalco, China Development Bank and of the Sugar Enterprise Privatization Team, Mr. Alcoa met in Jamaica last week and we are Aubyn Hill, for the excellent work they have optimistic that the agreement will be consum­ done not only to keep sugar alive but to give it mated.

This, again, would lift a huge burden the prospect of a new, exciting life.

from the backs of the Jamaican people.


Clarendon Alumina Production The government, through CAp, owns 45% of the Jamalco alumina plant.

What was once considered a strategic investment has become a We have entered into an agreement with a Chinese firm, Zhuhai Hong Fan, for the sale of CAP.

heavy burden on taxpayers, in part, because of Hong Fan is also committed to expanding the fixed-price forward sale contracts entered into Jamalco plant from 1.2 to 2.7 million metric between 2002 and 2005.
With upward move­ tons provided adequate long-term bauxite ment in production costs and downward move­ reserves can be assured.

The Minister of Energy ment in aluminium prices, we found ourselves and Mining will give further details in the sec­ in the awkward position where we were losing toral debate.

money on every ton of alumina produced.


This is despite the fact that the plant operates at a relatively high level of efficiency and we must continue to hail the outstanding performance of the workers and management at Jamalco.

We have had to provide up to now a total of US$176 million to meet CAP's obligations to Jamalco.

This is in addition to assuming US$369 million of debt for monies borrowed through CAP to help finance past budgets and cover its share of capital investment costs.
We have entered into an agreement with a Chinese firm, Zhuhai Hong Fan, for the sale of CAP.

The company has an alumina supply con­ Norman Manley International Airport The privatization of the Sangster International Airport has gone well.

We have established an enterprise team to pursue a similar strategy for NMIA.

We have already received expressions of interest from a number of reputable entities.

NMIA offers significant new economic oppor­ tunities.
One such area of opportunity derives from the benefits that NMIA can offer for easier air travel between the Far East and sections of Europe, on the one hand, and South America, on the other.

Currently, transit is made through a US gateway.

In recent times, the US Department of Homeland Security has intro­ tract with the Aluminium Company of China • duced transit visa requirements for all but 36 Positioning for Growth countries.
Passengers from all other countries The privatization of the port is, therefore, being are required to obtain transit visas in order to linked to the plans for the Caymanas Enterprise make connecting flights in the US.

Zone to facilitate investment in manufacturing NMIA which has significant excess capacity can provide a visa-free, hassle-free connecting point between these two ends of the world.
It offers significant possibilities for increased business in the provision of services and sup­ plies to aircraft and in-transit passengers.

It is a window of opportunity that will not remain open for long.

Other neighbouring countries also recognize these opportunities and we are moving swiftly to formally invite proposals for establishing NMIA as a strategic hub for transatlantic travel.
What the budget seeks to do is to create the conditions that will facilitate investment and growth - proper fiscal management, reduced deficit, lower interest rates, less borrowing, confidence-building transparency and accountability.

Port of Kingston The Port of Kingston is a strategic asset because it serves as a major transshipment point for cargo moving between north and south and between east and west.
Successful though it has been, it is highly leveraged by debt and its capacity is under-utilized, a situation made worse by the effect of the global recession on the volume of cargo passing through the ports.

Its potential goes far beyond the movement of containerized cargo.

It can play a significant role in supporting industries engaged in manu­ facturing, assembling and packaging the prod­ ucts that go into those containers .
and logistics enterprises that will create far more jobs than are provided merely by the handling of containers.

The Ministry of Industry, Investment & Commerce will give more details when he speaks.

Other legacy liabilities There are other legacy liabilities that are not capable of being privatized at this point but which constitute burdens that must be light­ ened.
NROCC, for example, represents a debt of US$442 million that we have to be servicing without any chance of receiving any portion of the highway tolls collected for several years to come.

We continue to explore possible avenues of refinancing to reduce the cost of servicing this debt.
The financing of the next phase of Highway 2000 (Sandy Bay to Williamsfield), the com­ pletion ofthe Mount Rosser bypass and the link from Golden Grove to Drax Hall are issues which the Minister of Transport & Works will address in the sectoral debate.
Positioning for growth Some have expressed disappointment that the budget doesnlt contain grand announcements of mega projects costing billions of dollars that we donlt have - like the Petrojam refinery upgrade that would have required us to find US$663 million to finance or Highway 2000 for which we owe US$442 million and climbing.

You canlt look to the budget to finance invest­ ment and growth.
What the budget seeks to do • Positioning for Growth is to create the conditions that will facilitate duction costs are accurate.

Only then will we investment and growth - proper fiscal manage­ see investment and job creation spurt and ment, reduced deficit, lower interest rates, less grow.

That is the way we must go!

borrowi ng, confidence-bu i Id i ng transparency and accountability.
We must return to the day such as existed up to June 1996 when the government was a net We recognize that improving our fiscal dynam­ lender to the commercial banking system, not ics is a necessary but not sufficient precondi­ a net borrower, when government deposited its tion for generating growth.
The Minister of surplus funds in the bank so that the manufac­ Finance has already appealed to the banks to turers, farmers, exporters and service providers demonstrate their commitment to the recovery can borrow that money to start or expand their programme by matching the reduced interest businesses, creating jobs so that our young on government paper with a commensurate people who leave school or graduate from uni­ reduction in interest rates charged on loans.
verSity can find their way to the main street We know they can't do it all at once; they have instead of being condemned to the backstreet.

contractual deposit arrangements that will take time to expire.

But just as they responded so magnificently to the Jamaica Debt Exchange, we urge them to be as aggressive as they can in reducing lending rates and reinforcing the sig­ nal that the change has begun and it is time to rev up investment.

The transformation cannot be confined to the fiscal.
We need a mindset change.

It calls for bold new thinking and innovative practice.

Many investment managers have spent the bet­ ter part of a generation in which packaging government paper was how you designed a good portfolio.

Project analysis and risk assess­ ment were skills you were taught in business school but never needed to call on.
We must return to the day when bankers and investment managers will spend most of their working day with their clients going through the numbers, drilling down to the feasibility, stress-testi ng the projections, reviewi ng the marketing programme, making sure the pro- The transformation cannot be confined to the fiscal.

We need a mindset change.

It calls for bold new thinking and inno­ vative practice.
Jamaicans are known for their entrepreneurial spirit - taking risks, getting a business started, working hard to make it grow.

That spirit has been dampened by a volatile economic envi­ ronment in which interest rates have often jumped so high that they would cripple a busi­ ness no matter how well run.

The bitter experi­ ence of FI NSAC has scared away many who might have sought loans to start or expand their business.
The attractiveness of government paper lured away those who might have invested without having to borrow.

We are changing that landscape.

We are accel­ erating the reform programme to reduce bureaucracy, improve efficiency, make doing business simpler and friendlier.

There are still challenges to contend with but we must com­ plain less and do more.

Positioning for Growth Spanish investors came here, saw opportunities Let's start where we left off, expand it as we and invested heavily in Jamaica.
Chinese need to but let us build that partnership among investors are coming here, seeing other oppor­ the stakeholders who, together, can energize tunities and investing heavily in Jamaica.

They this country into growth and development.

face the same challenges and inconveniences but that has not deterred them.

They see in us There are sectors of the economy that will con­ what many of us have difficulty seeing in our­ tinue to need government intervention to get selves.
I say to the many that sit and wait and them going and keep them going.

It may complain and wait: Ask not what the govern­ involve providing the right policy framework as ment can do for you.

Determine, instead, what is the case with the information and communi­ you are prepared to do for yourselves and the cation technology sector and we will shortly be government will do all it can to clear a path for you.
bringing to Parliament a new ITC policy that Partnership for Transformation It is in this spirit that we are building the Partnership for Transformation, a critical alliance embracing the government, private sector, trade unions and academia to enhance social dialogue, create a shared vision, identify our goals and build consensus on the actions that are required for social and economic trans­ formation.
We have established a monitoring and consul­ tative network focused on six key issues: • Tax Policy and Tax Administration Reform • Fiscal and Monetary Performance • Job Creation and Employment Strategies • Rule of Law • Education and Training • Trust among Partners will create new opportunities for investment and job creation and give Jamaica the compet­ itive advantage it needs.
It is in this spirit that we are building the Partnership for Transformation, a critical alliance embracing the Government, private sector, trade unions and academia to enhance social dialogue, create a shared vision, identify our goals and build consensus on the actions that are required for social and economic transformation.

It may require technical support such as we are providing to the farming sector and which is bearing fruit as seen in the growth of agricul­ ture over the last two years.
It is an important partnership, one which we It may require providing special access to had invited the Opposition to join.

They did for financing as is the case with micro, small and a while but have been absent from the table for medium enterprises.

Many have difficulty in more than six months.

accessing traditional sources of funding.

Some do not have adequate collateral to secure loans.

The Leader of the Opposition has called for a National Growth and Development Platform .
• Positioning for Growth Micro, Small & Medium Enterprises We had previously provided $1.7 billion in will give further details in the sectoral debate.

The renewed thrust for the redevelopment of downtown Kingston will see the construction special concessionary loans through the of the Digicel commercial centre and a multi­ Development Bank of jamaica.

This has been storey parking garage.


Design work on the new fully utilized and enabled us to disburse loans headquarters for the Foreign Ministry is well to 6,663 micro, small and medium enterprises advanced.

A hotel and multi-storey apartment providing employment for 9,612 persons.

complex to be built on the eastern side of the Kingston waterfront is in advanced design stage.
We have introduced a Credit Enhancement Facility to insure up to 50% of the loan amounts so that borrowers whose collateral is Bauxite and alumina I spoke earlier about the significance of the weak can still access loans to get their busi­ bauxite/alumina sector to jamaica and the crip­ nesses moving.

pling effect the closure of three of our four alu­ mina plants has had on the economy.

UC Rusal We are going to continue that programme this has announced the planned reopening of the year.
The DBj will be providing an additional Ewarton refinery by mid-year.

We welcome $2 billion in loans to the micro, small and that announcement and, especially, the jobs medium enterprise sector.

These funds are sep­ that will be restored to the bauxite workers.

We arate from the regular lending operations of the DBJ through which $1.2 billion was disbursed.
Of interest is the fact that of the total loans dis­ provided special concessions under the existing fiscal regime to enable the plant to be reopened.

bursed, 22% went to agriculture and 33% went The future of Alpart and Kirkvine remains less to manufacturing and agro-processing.

New investments The Minister of Tourism spoke of the initiatives being pursued for new hotel construction and certain.
If the global market for alumina con­ tinues to improve, we expect to see the reopening of Alpart but it is not possible to say how soon that will be.

expansion projects, some of which are expected Kirkvine faces two major challenges.

It is the to come on stream this year.

oldest of our plants and will require significant investment in new technology before it can There is good news for the people of Hanover achieve the desired levels of efficiency.
who suffered a setback when Jockey Secondly, the type of bauxite reserves that International closed their plant two years ago.

remain, although in abundance, requires con­ We have identified a major food manufacturer Siderably more energy to process.

with a wide-scale distribution network in the US and Canada which is to set up operations at The future growth of the bauxite/alumina the site, providing hundreds of jobs.
The industry, not just Kirkvine, depends heavily on Minister of Industry, Investment & Commerce our ability to provide a cheaper source of energy .

• l .
• l .

Positioning for Growth Energy diversification Our decision to diversify our energy sources Given our liability limitations, we were able to reach agreement with Venezuela for a transfer with the introduction of natural gas is consis­ of 2% of our shares which will now make tent with the energy policy that was tabled by Venezuela the majority owner and the joint the Minister of Energy and Mining last year.
venture will therefore be able to secure financ­ Pursuant to that decision, tenders were invited ing for the project without requiring a govern­ for the financing and construction of a Floating ment guarantee.

Storage and Regasification Facility to be located on the south coast.

Two tenders were received.

We are awaiting the outcome of the evaluation process.

It is not only the bauxite/alumina sector for which access to cheaper energy will make a is one that we must pursue.
It will not only give us the capacity to fully meet our domestic requirements for refined products but would also enable us to earn foreign exchange huge difference.
In the highly competitive envi­ The front-end engineering designs were com­ ronment in which we operate where cost effi­ pleted in July last year, the value engineering ciency determines whether we are in or out of exercise should be completed by September, the market, cheaper energy will improve con­ financing has already been identified and we siderably our ability to attract investment, are getting closer to the start-up of the project.
increase production and penetrate more deeply The Minister of Energy and Mining will provide both the domestic and export markets.

the House with more details.

Petrojam refinery upgrade Concern was raised about the future of the Roads We are just completing the dualization of the Petrojam refinery upgrade.

I mentioned that Bogue Road in Montego Bay.


Work is in our portion of the capital costs would amount progress on the dualization of Washington to some US$663 million that simply could not Boulevard between Molynes Road and be accommodated within the medium-term lia­ Dunrobin Avene.

The new Palisadoes road bility programme.

But the project is one that which will ensure that the airport is not cut off we must pursue.

It will not only give us the by tidal flooding is to start later this year.
The capacity to fully meet our domestic require­ China-funded major road rehabilitation project ments for refined products but would also valued at US$400 million is to start toward the enable us to earn foreign exchange from the end of the year.

The Minister of Transport & export of finished products and, in addition, Works will expand on these when he speaks.

further diversify our energy sources through the introduction of pet coke.

It is also a flagship of our economic cooperation with Venezuela.
Water We have been experiencing the worst drought in more than 30 years and it has been having a Positioning for Growth terrible effect on farmers who have done so and Latin America and we are proud to have well over the last two years and on households been selected as a member of the troika which that are deprived of this precious commodity.
developed the framework for the Declaration of Cancun that mandates the establishment of the We have tried to manage the crisis as best as Community of Latin American and Caribbean possible, rationing and redistributing what is States, merging the Rio Group and the Brazil­ available where it is possible.

We even con­ led Summit of Latin America and Caribbean for templated cloud seeding but decided against it I ntegration and Development.
because of the unpredictability of its outcome and the potential damage to our fragile infra­ The Conference of Heads of Government of structure.

Caricom will be held in Jamaica from July 4th to July 7th.

Jamaica will assume the chairman­ We are hopefu I that the recent rai ns herald an ship in place of Haiti which asked to be end to the long period of drought.

relieved of the obligation given its need to con­ centrate on its rebuilding efforts.
We will do so The budgetary allocations to the Ministry of at a time when Caricom faces significant chal­ Water & Housing for capital expenditure and lenges in fulfilling its commitments to the the capital programme of the NWC are the regional integration process and in confronting largest ever, together totaling some $9 billion the continuing impact of the global recession.
and are primarily to finance several new water Domestic issues such as crime and violence supply projects, the details of which will be which are increasingly being replicated across outlined by the Minister in the sectoral debate.

the region and the need to recover lost ground Foreign Affairs We continue to maintain an engaged and enlightened foreign policy stance at the regional, hemispheric and international levels.

in achieving our Millennium Development Goals are also prominent on our agenda.
Education We have sought as best as possible to preserve the budgetary allocations to education.

There We have remained resolute in the Conference have been reductions in some areas, the most of Parties on Climate Change, unwilling to Significant being the allocation to the UWI.

We engage in compromise on global warming caps know that this will pose difficulties for both the and carbon emissions that threaten the very students and the University.
I have had discus­ existence of small-island states like ourselves sions with the Vice-Chancellor to determine where the bulk of our population resides in how these difficulties can be worked through.

coastal areas.

The Minister is examining options as to how to ensure that students who might be particularly We have been at the forefront of the effort to affected are able to continue their courses with­ build stronger relations within the Caribbean out interruption .
• Positioning for Growth The funding of tertiary education is part of a through successive administrations that over debate that needs to be engaged.

The former 70% of the students who leave school at age 16, Minister of Finance attempted to do so some years ago but the discussion didn't proceed numbering some 38,000, have passed less than three subjects, 28,000 not even one!

They are very far.
They are very far.

Certainly, university education must referred to as "unattached youth" because they be financed, especially for students who are do not possess the academic qualifications that not in a position to meet the cost.

How it is to be financed, whether from budgetary alloca­ tions, student loans, a special class of bonds, education-investment savings plans or a com­ bination of all or some of these is what the dis­ cussion needs to be about.
Over 70 % of the students who leave school at age 16, numbering some 38,000, have passed less than three subjects, 28,000 not even one!

The needs of early childhood, primary, sec­ ondary and tertiary education, all compete for the same tax dollar.

There are simply not enough tax dollars to adequately finance all four.

The Minister will seek to advance that dis­ cussion when he speaks in the sectoral debate.
The Ministry of Education has focused much of its efforts last year in implementing the pro­ gramme for education transformation.

This included the establishment of the Jamaica Teaching Council, the National Education Inspectorate, Grade 4 Literacy and Numeracy Tests and the application of information tech­ nology to improve schools management.

The Minister will elaborate on these when he speaks.

There is one programme, however, which I must highlight.
It is a sad indictment on the efforts and investment that have been made would attach them to a place of higher learning or the basic skills to attach them to a place of employment.

They languish at home or loiter on the streets, the hopes and dreams that natural in every child receding rapidly into hopeless­ ness and despair.

The instinct to survive leads many of them into deviant behaviour and they become ready conscripts for criminal gangs.
The Career Advancement Programme (CAP) which was launched by the Minister last year is an important effort to address what is a human tragedy taking place before our very eyes.

The programme is designed to give these young people two more years of school i ng to retrofit their learning process and to equip them with basic, marketable skills.

Through collaboration with HEART/NTA, NYS and JFLL, we started in 11 schools involving approximately 1,500 stu­ dents.
This year, the programme will be rolled out to 54 additional schools.

It is a rescue mis­ sion, the kind of which the Leader of the Opposition spoke, and we intend to continue expanding the programme until no boy or girl in leaving school will run the risk of being left behind.

.Juvenile Correctional and Remand Facilities The Armadale tragedy and the enquiry that fol­ lowed brought into sharp focus the unaccept­ able conditions in which children in the cus­ tody of the State are managed.
Last month, I advised the House of plans to establish a new Committee of Parliament.

, urge the members juvenile correctional centre to eliminate the of the committee to conclude its deliberations overcrowding that now exists and a new as early as possible so that the matter can be remand centre for boys so that none of them brought back to the House.

Positioning for Growth would anymore be placed in police lockups.

We have found it necessary to make changes to the plans originally announced.
After detailed evaluation by the JOF which is undertaking the necessary works, it was decided that with the refurbishing of the Metcalfe Street Remand Centre which will have capacity for 250 chil­ dren, it would no longer be necessary to utilize the former youth camp at Cape Clear.

Also, it was determined that the site of the Copse Place of Safety in Hanover would provide better and safer facilities as a correctional centre than the Montpelier site as originally planned.
The refurbishing of the Metcalfe Street Remand Centre will cost $149 million and that of Copse $292 million.

The amount of $274 million which is included in the budget for Montpelier and Cape Clear will be supplemented by a pro­ vision of $100 million under the Citizens Security & Justice Programme as well as grant funds that have already been identified.

Work has started on Metcalfe Street and should be completed within 4-5 months.
Work will commence shortly on the new Juvenile Correctional Centre at Copse and is expected to be completed within 18 months.

Fighting corruption Our resolve to put in place effective measures to stamp out corruption remains firm.

The Bill to establish a Special Prosecutor to place pros­ ecutorial authority at the centre of our anti-cor­ ruption efforts is still before a Joint Select Our resolve to put in place effective measures to stamp out corruption remains firm.
The Contractor-General has suggested the establishment of an independent National Anti­ Corruption Agency.

That is exactly what we had proposed.

Our original idea was only modified to take account of the paramountcy given in the Constitution to the OPP in criminal prosecutions, a provision that can only be altered by a two-thirds majority in each House of Parliament.
What we, therefore, sought to establish is a legal office with all the necessary prosecutorial authority subject only to the over­ riding direction of the OPP.

While we pursue passage of the modified pro­ posal, we stand ready to have discussions with the Opposition on the position put forward by the Contractor-General.
Every person who is inclined to engage in corrupt practices must be made to understand that there is someone vest­ ed with the necessary authority who will hound him down all the way to prison.

Crime The level of crime and violence, particularly murder, shooting, violence against women and children and extortion, is a matter of grave concern to us and, indeed, to all Jamaica.
We have taken a number of measures to strengthen the capacity of the security forces Positioning for Growth including improving their forensic capabilities, While I welcome the commitment given by the restructuring essential intelligence and crime­ Leader of the Opposition and will seek to dis­ fighting units such as the Transnational Crime cuss with her how we can actualize such an and Narcotics Division and decentralizing approach, we need a much broader front for resources to enhance capability at the divisional which that effort can be a catalyst.
We need a level.

We have increased the number of police national consensus on the type of counter­ vehicles to 1,750, the highest it has ever been.

offensive that must be mounted against the criminal forces.

Efforts continue to improve the management of the Police Force through more rigorous recruit­ We and others outside of this Chamber spend a ment and training.
In the recent recruitment considerable amount of time shouting at each exercise, over 40 of the applicants were uni­ other, unwilling to coalesce around any solu­ versity graduates.

tion, each one proffering his own and proffering The drive to rid the Force of corruption continues blame.

to be intense.

64 members were arrested and Crime fighting strategies must be appropriate to charged last year for varying offences.

the crime that has to be fought.


For too long we Last year a total of 18,907 arrests were made, up from 16,582 in 2008.

569 guns and 6,068 rounds of ammunition were recovered.

Despite these efforts, we are not reaping the success that is desired.

The Leader of the Opposition has called for a partnership and has committed the Opposition to that partnership in tackling what is our most serious national problem.

Naturally, we wel­ come that commitment.


It is in that spirit that we had invited the Opposition to name a rep­ resentative to the National Security Council and the Opposition Spokesman on National Security has participated actively in the work of the Council.

Through his participation, he is aware of the challenges we face, the measures that have been taken to respond to those chal­ lenges and the disappointment we all share that the problem is getting larger, not smaller.
have allowed criminals to test our will and test our willingness to destroy theirs.

Societies that face extraordinary threats apply appropriate measures to deal with those threats.

The emergence of terrorism as a transnational threat to the safety and security of citizens forced countries like the UK, Canada and Australia - countries whose commitment to the rule of law is hardly ever assailed - to adopt measures that they would never have contem­ plated prior to 9/11.
Some instituted sunset clauses or specified review periods signaling that they knew these were extraordinary meas­ ures that they would not want to become per­ manent but signaling, as well, that when the security of the state is in danger, ordinary meas­ ures cannot be relied on to protect it.

The anti-crime Bills have languished because of a lack of consensus and, indeed, strident opposition from some interest groups.
They • Positioning for Growth will be reintroduced in the House within the Force and subject them to stringent oversight next few weeks and I hope that in the new spir­ and accountability.

it of cooperation and in the heightened anxiety that crime has created, we will be able to find The Bill establishing the Independent the consensus to do what needs to be done.
Commission of Investigations has been passed We will also bring to Parliament anti-gang leg­ place shortly so that it can bring a new sense of islation to discourage and enable law enforce­ transparency and accountability to the conduct ment agencies to more effectively dismantle of the security forces and the protection of the and we expect that the Commission will be in criminal gangs.

Today·s criminal networks did rights of the citizens.

not exist when the existing law enforcement powers were created.
The spanner we have Legislation to facilitate the use of DNA evi­ was never made to fit the nut we have to crack.

dence has been drafted and will be brought to The inflow of guns into Jamaica is what facilitates most of the murders that are committed.

The regulations to allow for the use of plea bar­ gaining have been reported on by the Regulations Committee and it is for the House now to confirm those regulations so that this important tool can be brought to bear in solv­ ing crime.
This will playa significant role but the suspect has to be apprehended before he can be invited to bargain a plea.

The Police are frustrated at the type of criminal activity they are called upon to protect the society from and the inadequacy of the tools they are given to do the job.

A concern among those who oppose the use of tough measures stems from a lack of trust in the security forces.

This is not without cause, given Parliament later this year.
That is a critical tool both for convicting the guilty and ensuring that the innocent is not convicted.

There is a range of social intervention pro­ grammes administered through the Ministry of National Security and the Ministry of Youth, Sports & Culture that will be continued.

The inflow of guns into jamaica is what facili­ tates most of the murders that are committed.

The security forces recover, on average, 600 guns each year.
We suspect that a greater num­ ber enter the island each year, creating an ever increasing arsenal of illegal weapons snuffing out I ives with callous brutal ity.

The overwhelming majority of guns coming into jamaica are of US manufacture.

A resolu­ tion before the United Nations for an interna­ tional convention to restrict the illegal traffick­ ing in small arms is still the subject of negotia­ the evidence of abuse of which some of them tions.

In the meanwhile, we intend to renew have been guilty.
That is not something we can our efforts to strengthen bilateral cooperation ignore but we can restrict the use of extraordi­ with the US with a view to addressing the flow nary powers to senior levels within the Police of illegal guns from the US to jamaica with the Positioning for Growth same vigour that we seek to apply to the flow prosecutors in the DPPls office, 8 of whom of illegal drugs from jamaica to the US.

are already in place.


.Justice The justice system is an integral part of the • We are establishing parish boards to be chaired by the Custos in each parish to review and monitor the passage of cases crime-fighting equation.

It is a vital part of our through the courts, help clear obstacles social infrastructure but it is overburdened.

where they appear and serve as an early warning mechanism where undue pressure Last year, we carried over in our courts is building up.
234,000 cases from the previous year.

243,000 • We are setting up Community Justice new cases were filed.

We disposed of 195,000 Tribunals chaired by justices of the Peace to cases.

The backlog continues to grow.

We are expanding the case management programme and training more judges, public and private attorneys and court staff in case management practices.
We are doing all we can within the limitation of our resources to address the problems: serve as community-level dispute resolution mechanisms to reduce the volume of cases entering the formal court system.

• A Child justice Diversion Programme is to be introduced this year to provide for appropriate forms of behavioural management intervention in specified cases instead of placing child offenders before the criminal courts.
• We are expanding the case management programme and training more judges, pub­ Transforming the social order At the heart of the challenges facing our justice lic and private attorneys and court staff in system and, indeed, much of our crime prob­ case management practices.

lem is a dysfunctional social order.

We live in • We have installed real-time court transcription a society in which we are each and all individuals, in the Supreme Court and Appeal Court.
We are endeavouring to extend this to all Circuit Courts.

• The operationalization of the Court not a community.

We revel in disagreement and conflict, so much so that we cannot find common ground on even the basic things such as what is right and what is wrong.

Management Agency of which the Leader of the Opposition spoke is imminent as the appointment of a CEO is now before the Chief justice for approval.
40 classified posts are being transferred from the Ministry of justice, office space on Tower Street has been secured and we hope to have the agency in operation in short order.

• We have made provision for 12 additional Basic laws that are necessary to sustain public order and social predictability are viewed as draconian.

Let the police seek to remove ven­ dors from a sidewalk and watch the cries of injustice on the television screen.
Let the Housing Agency or the U DC attempt to evict persons who have captured land and then hear how wicked you are.

It is not something confined to any particular • Positioning for Growth class.

Those who under-invoice goods in order went by those 50 or 60 years; we allowed to cheat the Customs, those who earn millions those 50 or 60 years to go by us.

of dollars each year but have never paid one dollar in income tax, those who toss trash out We were never destined to fail.
We only run of their car windows may be different in name the risk of failing our destiny.

but not in nature.

When the Minister of Transport & Works sought fect though it is but incomparable with any to enforce axle-load restrictions so that over­ alternative, guarantees our right to disagree but loaded vehicles are not allowed to put inno­ it imposes on a duty to unite for our common cent lives in danger and destroy our roads, good.
The democratic system that we cherish, imper­ there were protests from distributors and haulage contractors that we should abandon the programme because it would drive up the cost of transporting goods.

National consensus The Leader of the Opposition and I are at one.

We need a national consensus, not just about crime, justice, education and economic devel­ The Leader of the Opposition and I are at one.

We need a national consensus, not just about crime, justice, education and economic development.
We need a national consensus on the kind of society we want to build.

opment.

We need a national consensus on the It is said that Chile owes to Augusto Pinochet kind of society we want to build, the sacrifices not only its stain of brutality and oppression but we are prepared to make, the discipline we are the foundations of the economic success it prepared to impose on ourselves and how enjoys today.
That way has never been and can much we are prepared to invest in creating that never be an option open to us.

ki nd of society.

However, we can and must find the way with­ That is what the National Transformation in our fiercely competitive democracy to: Programme led by Rev.

AI Miller has been strike common cause; about.


Modest though its beginnings, it has recognize that the Jamaican flag must focused on issues such as restoring public always fly above the party flag; order, instituting discipline in the public trans­ understand ­ portation system, creating transformational • that if any of us, in our self-centred, zones and mobilizing transformational students.
individualistic passion, had all of Ian Boyne, in his article on Sunday, referred to life most miserable the poverty that characterized Japan and South • that the fruits of this land can only be Korea 50 and 60 years ago.

We could well add enjoyed if we plant and reap them India, China, Singapore and Malaysia.
They together; Jamaica to ourselves, ours would be a - - - - - - - -..- -_ ._ - - - - - -_.. ­ Positioning for Growth believe in our hearts that we can rid our understand it and I often question myself to selves of crime, poverty, unemployment, ensure that my best judgment is the right judgment.

disorder and conflict if - and only if - we forge a national purpose to achieve that.
There are many from time to time who will dis­ Conclusion This nation cannot continue pitter-pattering the agree with me including the privileged and the powerful.

Winston Churchill once said there is no such thing as public opinion, only pub­ way we have done for many years, running up lished opinion.

and down but not going anywhere.

We had to change course.

Someone once said a bend in the Unanimity is not necessarily the cradle of truth road is not the end of the road unless you fail or wisdom.
I have never been obsessed with being to make the turn.

We have made that turn.

We a crowd pleaser for crowd pleasers hardly ever are on our way and our future, the success and make good leaders.

There is an old African prosperity we seek for the people of Jamaica proverb that says smooth seas do not make skil­ rest on the strength of our will and the stamina ful sailors.

William Shedd wrote: "A ship is safe in our being to run the race and finish the course.
when it is in the harbor but that's not what It has been a hard road to travel and we still ships are for".

have a mighty long way to go.

We have borne Mother Teresa once said "I know God will not the heat and the criticism - none more so than give me more than I can handle.

I just wonder I.

Some of it may be malicious; I try never to how He has so much confidence in my ability be contemptuous of it.

Some of it may be gen­ to handle what he has given me".
uine misunderstanding or disagreement; I try to •