Today [18 August 2021] at a media briefing, Grenada’s Fiscal Responsibility Oversight Committee (FROC) shared with the media and members of the public the key takeaways of its 2020 Annual Report.
Pursuant to Section 14 (3) (b) of Grenada’s Fiscal Responsibility Act (No. 29 of 2015), the Report was submitted to the Hon. Michael Pierre, Speaker of the House of Representatives and Chairman of the Committee of Privileges, on 30 April 2021 and subsequently laid before the House of Parliament on 21 May 2021.
“With the advent of the Covid-19 virus which triggered the Escape Clause of the Fiscal Responsibility Act (FRA), the 2020 Report was adjusted accordingly and does not include a report on compliance with the rules, targets and corrective measures under Sections 7 & 8 of the FRA. In the preparation of this Report, the FROC received support from Hon. Gregory Bowen, (Minister) Mike Sylvester (Permanent Secretary), and the staff of the Ministry of Finance, Economic Development, Physical Development, and Energy in Grenada. Consultations were also held with other members of the public sector, private sector and civil society, to inform this Report. We are also grateful for the continued support of the Governor of the Eastern Caribbean Central Bank, Timothy N.J. Antoine. Additionally, we recognise the outstanding leadership of the past FROC Chairman, Richard Duncan, and the valuable contributions of former members of the FROC. We also wish to thank the Speaker of the House for granting an extension for submission of this Report. Finally, we acknowledge the support of the media and members of the public,” said Dr E Angus Friday, Chairman of the FROC.
Covid-19 continues to have a detrimental impact worldwide. Grenada’s economy was estimated to have declined by 12.2% in 2020. The Grenada authorities took corrective measures by implementing necessary public health measures and by invoking Section 10 of the Fiscal Responsibility Act, also known as the Escape Clause. The Escape Clause was properly invoked. Only one criterion needs to be satisfied for the activation of the Escape Clause and only one was satisfied, that being, FRA (10(1)(a) that a “public health epidemic” resulted in a “state of emergency” being “declared by the Governor-General.”
First, there are shortcomings of the FRA which necessitate an urgent and comprehensive review of the legislation. Second, ensuring a green, resilient and inclusive recovery is critical given the need to ensure social cohesion and stability during this challenging period. Job-rich growth that prepares Grenada for the new post-pandemic realities, must be prioritised which will help to reduce unemployment and improve the debt to GDP ratio. Finally, it is important to maintain sound fiscal management to effectively buffer future shocks. Other Sections of the FRA are still in effect and this means that public finance should be managed in such a way that it is transparent, accountable, and involves prudent management of debt and fiscal risks. Efficient public finance management systems are critical in shaping improved fiscal and debt outcomes in the medium term.
Members: Dr E Angus Friday, Chairman; Shadel Nyack Compton, Zanna Barnard, Anthony MacLeish, Sally Anne Bagwhan Logie.
Secretary: Michelle Millet.
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