Thread by @DrNigelClarkeJa

The CARE Programme!

The CARE Programme represents the Jamaican society coming together to assist those who are most affected by the economic impact of the Covid pandemic to put us in the best position to be able to recover and to be stronger than we were before the crisis.

We have the best chance to recover if we support companies to remain connected with their employees and we support employees who have been disconnected.

We care about employees across Jamaica who could be affected by this pandemic.

BEST Cash

Mr Speaker, we will introduce the Business Employee Support and Transfer of Cash (BEST Cash) – which will provide temporary cash transfers to registered businesses operating in the hotel, tours, attraction companies, segments of the tourism industry.

Theses businesses shoud be licensed with the Jamaica Tourist Board based on the number of workers they keep employed who are under the income tax threshold of $1.5 million.

To qualify, each tourism business will need to apply for BEST Cash by filling out the required form online. They would then file and pay their payroll returns as usual on the 15th of April, May and June.

For each employee, with taxable income that is less than 1.5m on whose behalf statutory returns are applied, the Government will transfer funds at a rate of $9,000 per fortnight to that tourism related business, by direct transfer to their bank account, paid monthly.

For the months of April, May and June that will equate to $54,000 for each employee they retain whose taxable income is less than $1.5 million.

Mr. Speaker, Jamaica has never had a direct transfer programme such as this and we have a multi-disciplinary team from the Ministry of Finance, the Accountant General’s Department, Tax Administration Jamaica and eGOV who are designing the online interface processes and protocols

SET Cash

Now Mr. Speaker, we recognize that employers will not be able to retain all employees on the payroll. We also understand that employees from industries other than tourism will be laid off.

For that reason, Mr. Speaker, we will implement the Supporting Employees with Transfer of Cash (SET Cash)–which will provide temporary cash transfers to individuals where it can be verified that they lost their employment since March 10, (the date of the first Covid case in Ja).

This programme will be available to employees from any sector who lost their employment after March 10 and before June 30. We are working so that individuals can begin to apply by April 9.

Mr Speaker we will allocate $1 billion in additional funding to the Ministry of Labour and Social Security and work with them as they seek to assist the informally employed who are affected.

PATH Beneficiaries will ordinarily receive a payment in April and a similar payment in June. Mr. Speaker, in a response to the economic effects of the Covid pandemic.

The Government will make an additional payment of a similar amount in May which will have the effect of increasing by 50% the amount the aggregate amount that PATH beneficiary would have ordinarily received during this period of April - June.

So, to be clear Mr. Speaker, the amount received per payment remains the same but the frequency will increase over this period. Instead of two payments, there will be three which means the aggregate amount increases by 50%.

All small businesses with sales of $50 million or less who file taxes in the 2019/20 financial year, and who filed payroll returns indicating they have employees, will be eligible for a one-time Covid Small Business grant of $100,000.

As such Mr. Speaker the Government will make $1.2 billion available in the form of grants to businesses operating in the tourism and related sectors.

In consultation with the Jamaica Hotel and Tourist Association we will establish the maximum grant that any one business can receive among other criteria.

These grants will be accessible by application to a special multi-stakeholder Covid Tourism Grant Committee and by submitting detailed information.

Mr. Speaker, the poor and vulnerable are not limited to the PATH beneficiary population. Poor and vulnerable Jamaicans include the elderly not on PATH, the infirmed, the homeless, and people on the streets.

Mr. Speaker, we will allocate $150 million to the Ministry of Local Government to supplement the Poor Relief programme, and their budget in general, to respond as required with the food, medicine and supplies that this population will require.

The Prime Minister spoke about increasing the allocation of the Constituency Development Fund by $3 million to address Covid Compassionate Grants and care packages for the vulnerable on a constituency basis. This will cost approximately $200 million.

Mr Speaker, many small farmers have crops in the field about to be harvested where the intended market was the hotel sector.

I have had consultations with Minister Shaw and we will be reallocating expenditure in the MICAF budget to provide $200 million for relief to small farmers either through funding NGO’s to purchase farm output from those who supply hotels and give to the needy or other means

Importantly, Mr. Speaker, the Covid Compassionate Grants which total $650 million are in addition to the $10 billion but will be financed by reallocations of existing budgets.

Mr Speaker, there was a time that government was seen as Babylon, where Government was seen as something to escape from.

This is the moment Mr. Speaker where we see Government as provider of assistance when it is needed.

This is the moment, Mr. Speaker, where those who play by the rules win. Those small businesses who filed have provided us with the information that allows us to engage in this counter-cyclical stimulus to small business.

Those registered with the Jamaica Tourist Board or with JUTA or with the metropolitan authority are in line for assistance.

This is the moment Mr. Speaker when we realize that we are all in this together.

When you think that the financial institutions volunteered the give back of the asset tax reduction and we are using that to provide stimulus to small businesses, as well as the poor and vulnerable across all sectors, you realize that something very special is happening in Ja.

In addition to all of the above, as previously announced GCT will be reduced by one and a half per cent, (1.5%), effective April 1, 2020.

Mr. Speaker, the Covid pandemic will depress aggregate demand, which will affect all sectors of the economy and all consumers. There is no better time than now to return $14 billion to the Jamaican people.

Those funds will, in total, remain in the economy at a time of softness, which will help, in supporting aggregate demand at this critical time.

After years of fiscal consolidation, and $185 billion in tax increases (2020 dollars) over the past two decades, it is a moral imperative that it be manifestly evident that all Jamaicans have benefited from the improvement in the Jamaican economy to date.

Whether through
•new jobs,
•lower interest rates
•increase in NHT home starts
•substantially larger PATH payments,
•new highways,
•new roads,
•upgraded hospitals,
•renovated police stations,
•mobility of police,

•Improvements to come in garbage collection and the fire service or
•through the substantial raising of the income tax threshold,
•the abolishment of distortionary taxes,
•the reduction in transaction taxes or through
•the reduction in the rate of GCT

It is important that all Jamaicans benefit from the improvements in the economy to date.

With the broad based nature of the last measure we are certain that every Jamaican will have benefited to some degree from the improvement in the Jamaican economy.

Mr. Speaker the expenditure side of the stimulus, such as the CARE Programme, will require submission of supplementary estimates in early April.

This Supplementary Budget will address the additional expenditure outlined under the CARE Programme. While we have done scenario analyses on the economic impact of the Covid-19 pandemic at various levels of intensity, it is too early to forecast what is likely.

As such it is unlikely that the Supplementary tabled in the first few days of April will adjust the revenue side of the budget.

It will be solely focused on getting this $10 billion to the people and businesses that it need it most in addition to the reallocations of expenditure that can release other resources.

As you can imagine Mr Speaker, activities that we had planned to spend on will need to be delayed and those funds can be repurposed.

Upon passage of the Supplementry Budget we can begin processing payments for those verified under the various components of the CARE Programme with the expectation that payments by way of bank transfers will begin towards the end of April.

For loans currently in repayment the SLB will waive late fees for the period April – June and the SLB will defer all loans in repayment – principal and interest – for three months.

This will not result in losses to the SLB but the timing difference of payments will have a cash-flow impact on the SLB which can be easily absorbed by the reserves of the SLB.

At this time we wish to advise pensioners that we will suspend the requirement for Life Certificates as at April 20, 2020 for payment in June 2020.

That is payment in June will be made automatically on the basis of the last life certificate on hand without the need for a renewal in April.

Up to June 30th, Tax Administrative Jamaica will facilitate the issuing of one-off or single use Tax Compliance Certificates to businesses who may fall into non-compliance over the period to June 30th.

There will be no new summonses issued, court proceedings or enforcement action for non-compliance until after June 30. However, reminders and notices will continue to be generated.

Businesses are in crisis mode and should not be distracted from core activities and have to divert resources to enforcement matters during this critical period.

So, Mr. Speaker, we will be implementing an unprecedented $25 billion fiscal stimulus consisting of $15 billion tax reduction and a $10 billion spending programme. Even while being in the middle of our fiscal consolidation, we the resources to address our immediate needs.

Every Jamaican should be proud of what we can achieve together.

Mr. Speaker, we have presented a budget that will move Jamaica forward even in the face of unprecedented challenges.

We will be:

•investing in our physical infrastructure by large capital expenditure allocations on critical areas such public parks, highways, roads and water

•Investing in our social infrastructure to improve public services and improve standard of living. We are investing in 30 new fire trucks, 50 new buses and 100 new garbage trucks Mr. Speaker

•Investing in our social infrastructure by improving and upgrading our hospitals Cornwall Regional, UWI and the new Childrens Hospital in the West

•Investing in our social infrastructure in upgrading primary and secondary schools.

•Investing in our social infrastructure by cleaning and maintaining our gullies

•Investing in building our public sector capacity by creating the Marcus Garvey Scholarships, the largest graduate scholarship programme in the history of Jamaica

•Investing in our economic infrastructure by increasing skills training, improving rural farm roads, broadening and expanding ownership of the economy and improving access to finance

•Investing in the expansion of our social protection with new programmes to protect and support one of the most vulnerable segments of our population

•Innovating approaches to provide financial protection against natural disaster risk and make sure that Jamaica has fiscal buffers in place should natural disaster strike

•Strengthening our critical domestic institutions such as the Bank of Jamaica and the proposed new Fiscal Council to deepen fiscal and monetary transparency

•Improving governance and accountability of our public bodies to ensure better delivery of our public services, make better use of our scarce resources, and engender greater trust among the Jamaican people

•Accelerating the repayment of our debt through creative and innovative transactions that help to release fiscal space

•And to use that fiscal space in manner that:

1. enhances our prospects for greater economic growth and higher employment with counter-cyclical measures
2. provides a stimulus to small and medium size businesses
3. importantly, returns money to the people of Jamaica; and

4. critically, provides a historic contingency to provide for the possibility of wider effects of Covid-19.

•That contingency will finance:

1. The CARE Programme, 5.9 billion for

1a. SET Cash temporary grants for laid off or terminated employees whose taxable income is 1.5 million or less, and

1b. BEST Cash temporary grants to support businesses in the tourism and related sectors in retaining employees whose taxable income is 1.5 million or less

1c. $1.1 billion for Covid PATH Grants to support the poor and vulnerable on PATH with a payment that effectively increases what they would otherwise receive in the period April – June

1d. $1.0 billion to support Covid Grants for the informally employed who are affected

1e. $800 million for Covid MSME Grants to support micro and small business across Jamaica

1f. $1.2 billion in Covid Tourism Grants to support smaller operators in the tourism and related sectors

2. In addition, we will re-allocate expenditure to finance

2a. $200 million in Covid Compassionate Grants from the Constituency Development Fund to be distributed through Constituency Offices, and

2b. $150 million in support to the Ministry of Local Government to attend to the needs of the elderly not on PATH, the infirmed and the homeless

2c. $200 million to support small farmers at this time

3. We will be deferring principal and interest payments on student loans for the three month period April – June to cushion the impact on young graduates while giving new graduates 14 months to start payment their student loans after graduation

When we come together as a society as has been evident over the past few days and weeks, there is nothing that we cannot do, nothing that we cannot overcome.

Moreover, this is a Government that CAREs, Mr. Speaker.

And at a time of crisis, by simply Caring, we are Moving in the Right Direction.