Stating that government will pursue the initiatives and programmes in the 2022/2023 Estimates of Revenue and Expenditure he presented in parliament this week, Prime Minister Philip J Pierre announced that his administration will keep the promise made by the former administration and pay the increase in salaries of public servants by the end of this month.
“I just want to make it clear again that the civil servants’ increase is going to be in April 2022 and for the back pay, the first tranche is going to be in December 2022 and the second tranche in March 2023,” Pierre said.
He added that the budget for the 2022/2023 fiscal year will bring transformative change that will impact the lives and livelihoods of citizens and government will put the people first.
“We have approached this budget with the understanding that the current circumstances, domestic, regional, and international, within which we operate and we are strengthening our belief that while current resources may be insufficient to meet the needs of all, our collective potential and our resolve to put our economy on the path of broad-based, inclusive growth will empower our people and propel us forward,’ Pierre said.
He then went on to give details of wages and salaries for the current fiscal year noting that government records indicate that from year to year, employee compensation represents on average approximately 33.25 percent of the annual total budget.
“In the 2022-2023 budget a total provision of $590.70 million for Wages and Salaries, of which a sum of $560.56 million or 94.89 percent has been programmed to cover personal emoluments to central government employees while $30.13 million has been allocated to cover compensation and other benefits to project staff. A sum of $108.55 million has been allocated to retiring benefits, of which $14.15 million is in respect of employer contributions to NIC. Overall, employee compensation is programmed to increase by 11.88 percent relative to the outturn for the current financial year,” Pierre said, adding that the allocated amount also makes provisions for in-year promotions and other salary and wage allowances.
Pierre presented in parliament an EC$1.8 billion budget, the largest by any government in the island’s history, underlining this by saying government will work steadily and tirelessly towards accelerated recovery, following the devastating impact of the COVID-19 pandemic.
“As the allocations programmed in this budget indicate, we intend to continue to tackle the challenges with boldness and confidence. We remain optimistic, assured, and rooted in our resolve to maintain economic stability and chart a path to sustainable growth and development, Pierre said.
He then gave an account of how the budget will be financed noting that “while we anticipate moderate improvement in the revenue administration and grant receipt from friendly donors, a significant financing gap remains.”
“Based on the projected level for revenue and grants, the budget targets an overall deficit of $394.57 million for the fiscal year 2022-2023. When added to the Principal Repayment for the year a financing gap of $505.1 is anticipated which will be financed by a blend of foreign and domestic financing resources. In addition to Total Revenue and Grants of $1.327 million, it is anticipated that my government will have to borrow a total of $505.12 million comprising $425.4 million, equivalent to 84.2 percent of the total financing requirement for the year from external sources. Domestic financing is expected to be moderate given that much lower amounts are programmed from primarily bonds,” Pierre said.
He stated that this is entirely in keeping with his government’s strategy of relying on external borrowing on concessional terms rather than the market debt which bears higher interest rates.
“Domestic financing requirement amounts to $79.7 million which is expected to be sourced through various means including Treasury Bills, Treasury Notes and Bonds. The total amount to be raised from external sources will be as follows: Caribbean Development Bank – $57.3 million, International Development Association (IDA) – $ 82.3 million, Republic of China on Taiwan EXIM Bank – $191.8 million CARICOM Development Fund (CDF) – $3.06 million, CDB-Inter-American Development Bank – $8.6 million, Canadian Clean Energy & Forest Climate Facility Fund – $1.4 million, World Bank (Development Policy Credit) – $81 million,” Pierre said.