Fiscal council re-established to strengthen public purse oversight

The Ministry of Finance has re-established an independent fiscal watchdog, signalling a renewed push for transparency and accountability as global economic uncertainty intensifies and the country continues its long-term debt reduction efforts.

A government statement on Thursday announced the reconstitution of the Fiscal Council of Barbados, noting that the body will review whether the economic and financial projections underpinning the national budget are credible, evaluate the government’s adherence to fiscal responsibility commitments, and monitor long-term fiscal risks involving state-owned enterprises, contingent liabilities and climate-related exposures.

The council will also publish annual independent assessments of the Fiscal Framework, Mid-Year Review, Pre-Election Economic and Fiscal Update and the national budget, the statement said.

“The council’s only job is to examine the evidence and report its findings transparently to the people of Barbados,” the ministry declared.

“The published assessments will be freely available to every Barbadian who wants to read them.”

The five-member body brings together economists, finance professionals, banking executives and labour representatives from Barbados and abroad.

Former acting director general of South Africa’s National Treasury Ismail Momoniat has been appointed chairman, while deputy principal and professor of economics at the University of the West Indies Cave Hill campus Professor Winston Moore will serve as deputy chairman.

Other members are emeritus economics professor Nlandu Mamingi, chief country management officer at CIBC Caribbean Donna Wellington, and labour relations consultant Cedric Murrell, the former Congress of Trade Unions and Staff Associations (CTUSAB) president.

The Fiscal Council was first established in May 2023 during the International Monetary Fund-backed economic reform programme following the country’s debt restructuring and fiscal recovery efforts.

The move to reconstitute the fiscal council comes amid the Mottley administration’s efforts to maintain investor confidence and fiscal stability while navigating global economic uncertainty and long-term debt reduction targets under its ongoing reform programme. 

Barbados entered an IMF-supported Extended Fund Facility programme in October 2018 when public debt had reached roughly 160 per cent of gross domestic product (GDP).

Public debt declined to 117 per cent of GDP by June 2024 and was projected to continue on a downward trajectory, with the long-term target set at 60 per cent of GDP by 2036.

The finance ministry stressed the council operates independently and does not answer to government. 

“The council is an independent, non-statutory body. It is not created by law, it is not controlled by government, and it does not answer to any ministry,” the statement read, adding that the council has already met, agreed its mandate and begun work.

“The published assessments will be freely available to every Barbadian who wants to read them. The Fiscal Council of Barbados is now operational.”

Minister of Finance Ryan Straughn described the council as an important accountability mechanism at a time of continued global instability.

“Good governance is not just about making the right decisions, it is about being willing to be held accountable for them,” Straughn said.

“No government gets everything right. Governing a small island nation in the middle of a turbulent global economy is serious work.”

He added: “What matters is that there are credible, independent people watching, ready to say so when we fall short and to confirm it when we do not.”

“And when they say we have fallen short, we listen, we adjust, and we act. That is how good governance actually works in practice.”

Straughn also paid tribute to former chairman Alejandro Werner, who headed the IMF’s Western Hemisphere Department, saying he had helped strengthen the council during his tenure.

“Alejandro never treated this as a ceremonial role,” the minister said.

“He asked hard questions, he pushed for rigour, and he left the council in better shape than he found it.”

A 2024 United States Treasury report on IMF lending programmes to Barbados and Suriname described the fiscal council as being established “to further demonstrate commitment to sound fiscal management”.

The report added: “This council will hold the government accountable for transparent implementation of the fiscal strategy, which focuses on reducing public expenditure particularly through [state-owned enterprises] reform and institutionalising the Medium-Term Fiscal Strategy.” 

 

(SM)