Shaw made no provisions for contingencies
Published:Friday | October 1, 2010 | 12:00 AM
Jamaican fiscal and monetary authorities, while predicting that economic activity would likely be flat, worse case, or attain growth of up to one per cent, best case, had added riders that could derail gains - including weather shocks.
The torrential rains this week have not only wreaked havoc on public infrastructure, but have also hampered business activity, downed power lines and shuttered schools.
But the Government has budgeted zero dollars for contingencies, leaving its fiscal programme exposed.
Last year, contingencies got a J$9-billion allocation at the top of fiscal year 2009-10, but in the absence of storm impact, the allocation was narrowed to less than a tenth of the original provision, to J$965 million.
Finance Minister Audley Shaw, perhaps banking on the county's CCRIF insurance policy in the event of a serious hit from a hurricane, totally eliminated the contingency safeguard this year.
It is too early, the finance ministry says, to say how it would impact GDP growth, and that a more precise picture may emerge after the weekend; but the prime minister on Wednesday has already acknowledged that the rains will derail the budget.