Grenada’s Prime Minister Dickon Mitchell says the 2023 Estimates of Revenue and Expenditure, which will be presented during the last quarter of this year, will be prepared in conformity with the rules and targets as required by the Fiscal Responsibility Act (FRA).
“There is no more state of emergency in Grenada and so when we go into the next budget cycle, we will be required to comply with the three rules that are set out under that Act for the prudent fiscal management of the affairs of Grenada,” Mitchell told Parliament.
The FRA provides for the government to suspend the rules and targets in cases of natural disasters, war, or a pandemic.
“So, our expenditure, in particular, must comply with that legislation. Therefore, the opportunity for instance to pay the pension arises now, so it’s just not a question of the campaign promise, the reality is, it arises now and therefore we have the fiscal space to do it now and we must do so because it may not be permissible under the fiscal responsibility rules which will be in place for the next budget cycle,” Prime Minister Mitchell said.
Legislators were required to approve EC$60 million (One EC dollar=US$0.37 cents) to pay retroactive pensions to hundreds of retired public servants who were affected by the 1983 Pension Disqualification Act which came into effect in 1985 but in March 2022, was deemed by a court to be a violation of their constitutional rights.
The EC$60 million is part of the EC$194 million Supplementary Appropriation Bill required to continue the work of the government.
Dickon Mitchell, who led the National Democratic Congress (NDC) to power in the June 23 general election, said the former New National Party (NNP) administration had the fortune or misfortune of being able to call a state of emergency as a result of the COVID-19 pandemic.
“That allowed the former administration to suspend the operations of the Fiscal Responsibility Act,” said Dickon, reminding Parliament that his government’s fiscal decisions must comply with the FCA.
The FRA, enacted by the NNP administration in 2013 states that 40 percent of the monthly inflows into the National Transformation Fund shall be saved for general budget financing purposes, including contingency spending, natural disasters, and debt reduction.
CMC/
