Jamaica’s fiscal research centre is a big deal

On October 22, 2024, the University of the West Indies (UWI) signed a partnership with the Institute of Fiscal Studies and Democracy (IFSD), based at Canada’s Ottowa University, to launch its new Fiscal Research  Centre.

Both funders — Minister of Finance Dr Nigel Clarke and regional economic advisor David Rosenblatt of the Inter-American Development Bank (IDB), who represented his boss Anton Edwards, acted as witnesses for  their respective institutions. Indeed, Minister Clarke noted that the special grant of $200 million for the Fiscal Research Centre from the Jamaican Government had been just approved last week Friday, while  Rosenblatt advised the IDB was planning to provide US$250,000 for climate finance research and US$400,000 for general research and capacity-building.

In his short presentation, founding president of the IFSD Kevin Page, who had worked for 27 years at Canada’s Ministry of Finance before founding Canada’s first Parliamentary Budget Office in 2008 (before  leaving to found the IFSD) explained the “democracy” piece of their name as helping “leaders who need support” with “really difficult” political challenges, such as climate change, as part of its public  discourse.

In this context, it is worth noting that as early as 2003, under the then partnership for progress “social partnership” initiative, the Jamaican private sector had looked at the UK’s Institute for Fiscal  Studies as a potential model.

Page noted that fiscal commissions are now a global trend, as, along with the existing European network of fiscal commissions, there is now an African network (which pledged their support for Jamaica’s  initiative) and an Asian network that has just been established in Seoul, Korea.

In his keynote address, Finance Minister Clarke correctly called again for Jamaica to study its economic history through non-partisan lens so that the country can see it as an “integrated whole”. For  example, he noted that Jamaica had run fiscal deficits roughly 95 per cent of the time since 1974 and that, incredibly, we had negative net international reserves from 1976 to 1993.

He argued that the new research centre provided opportunities for undergraduates to learn sound public financial management and was a key step towards ingraining its benefits, critical to an economically stable society. He argued, with a nod to former Bank of Jamaica Governor Brian Wynter who was in the audience, that because our central bank was now independent, we had for the first time managed to get  ourselves out of an “externally driven” inflation spiral in a short space of time, with inflation quickly being brought back into its target range.

Importantly, he articulated the role of the Courtney Williams-led independent fiscal commission, which was to look at how one is doing “today” and forecast the medium-term outlook, in contrast with the  research that would be undertaken by the likes of Dr Nadine McCloud (a key driver of the fiscal research centre initiative) to teach public financial management and do research that looks forward five or 10  years.

He also spoke about a potential agenda for the research centre based on the current global technological revolution, noting that Uber doesn’t own cars and Airbnb has no hotels. He argued that policymakers  needed to look at the trade-offs with, for example, hotel room tax in this environment of technological transition.

SOURCE: https://www.jamaicaobserver.com/2024/10/23/jamaicas-fiscal-research-centre-big-deal-20241023-2029-353318/