Grenada, OECS Fiscal Issues : Policies to Achieve Fiscal Sustainability and Improve Efficiency and Equity of Public Expenditures

The report reviews Grenada public expenditures for the period 1995-02 and suggests policy recommendations to achieve fiscal sustainability, improve social service delivery, and reform social protection based on the economic situation of the country at the time. To restore rapid economic growth, ensure medium-term fiscal sustainability under the umbrella of the currency union and protect the social achievements realized in the past decades, the main challenges facing the Grenada government are to: (a) tighten fiscal policy, notably through reduction of capital expenditures and the realization of the fiscal savings expected from the public sector reform initiated in 1997 (b) increase the efficiency of public investments and public service delivery; (c) strengthen regulation and efficiency of public utilities and sea/air transport; (d) modernize the legal framework that oversees public sector employment; and (e) promote education and skills development to prepare the population, notably the poor, to take advantage of new opportunities in the global environment. The report is organized as follows: Chapter 1 discusses fiscal sustainability in Grenada and presents options for fiscal consolidation; Chapter 2 discusses the role of the business cycle in the design of fiscal policy by reviewing the cyclical components of the fiscal accounts; Chapter 3 discusses the budget management system in place and its effect on budgetary outcomes. Chapter 4 examines the Public Sector Investment Program (PSIP); Chapter 5 discusses public sector employment and compensation issues; Chapters 6 and 7 examine public expenditures and outcomes in the education and health sectors; and Chapter 8 discusses social protection programs. Since the completion of the report, Grenada has undertaken a number of important initiatives to address the fiscal challenges that the country faces, especially in the aftermath of Hurricanes Ivan and Emily. In particular, the authorities have developed a "burden-sharing" strategy to achieve fiscal sustainability. However in Grenada, as in all small states, faster implementation is hindered by limited institutional capacity.

Bibliographic Details

Main Author:	World Bank
Language:	English en_US
Published:	Washington, DC 2004-10-25
Subjects:	ACCOUNTING, AGRICULTURE, BUDGET BALANCES, BUDGET MANAGEMENT SYSTEM, BUDGET PROCESS, BUSINESS CYCLE, BUSINESS CYCLES, CAPITA INCOME, CAPITAL BUDGET, CAPITAL EXPENDITURE, CAPITAL EXPENDITURES, CAPITAL PROJECTS, CAPITAL SPENDING, CENTRAL BANK, CENTRAL GOVERNMENT FISCAL, CONTINGENT LIABILITIES, CYCLICAL EFFECTS, DAMAGES, DEBT MANAGEMENT, DEBT RATIOS, DEBT SERVICE, ECONOMIC COOPERATION, ECONOMIC GROWTH, ECONOMIC SHOCKS, ECONOMIC SITUATION, ECONOMIC SLOWDOWN, ECONOMIC STRUCTURE, EXPENDITURE CUTS, EXPENDITURE GROWTH, EXTERNAL DEBT, EXTERNAL SHOCKS, EXTREME POVERTY, FINANCIAL MANAGEMENT, FISCAL ACCOUNTS, FISCAL ADJUSTMENT, FISCAL BALANCE, FISCAL CONSOLIDATION, FISCAL CONVERGENCE, FISCAL CONVERGENCE CRITERIA, FISCAL DEFICIT, FISCAL DEFICITS, FISCAL DISCIPLINE, FISCAL FRAMEWORK, FISCAL INFORMATION, FISCAL ISSUES, FISCAL PERFORMANCE, FISCAL POLICIES, FISCAL POLICY, FISCAL RESPONSIBILITY, FISCAL RULE, FISCAL RULES, FISCAL SAVINGS, FISCAL SURPLUS, FISCAL SUSTAINABILITY, FIXED EXCHANGE RATE, GDP, GOVERNMENT BUDGET, GOVERNMENT EXPENDITURE, GOVERNMENT EXPENDITURE COMPOSITION, GOVERNMENT REVENUE, GROSS DOMESTIC PRODUCT, GROWTH POTENTIAL, GROWTH RATE, GROWTH RATES, HEALTH SPENDING, HUMAN CAPITAL, INFLATION, INFLATION RATE, INTEREST PAYMENTS, INTEREST RATES, INTERNATIONAL MONETARY FUND, INTERNATIONAL TRANSACTIONS, LOCAL REVENUE, MACROECONOMIC STABILITY, MONETARY POLICY, PER CAPITA INCOME, PRIMARY BALANCE, PRIMARY DEFICIT, PRIMARY EXPENDITURE, PRIMARY SURPLUS, PRIVATE SECTOR, PUBLIC, PUBLIC DEBT, PUBLIC EXPENDITURE, PUBLIC EXPENDITURES, PUBLIC GOODS, PUBLIC INVESTMENTS, PUBLIC POLICY, PUBLIC SECTOR, PUBLIC SECTOR COMPENSATION, PUBLIC SECTOR EMPLOYMENT, PUBLIC SECTOR REFORM, PUBLIC SECTOR WAGE, PUBLIC SECTOR WAGE BILL, PUBLIC SERVICE, PUBLIC SERVICE DELIVERY, PUBLIC SERVICES, PUBLIC SPENDING, PUBLIC UTILITIES, REAL INTEREST RATE, REAL TERMS, REDUCTION IN TAX, RESOURCE ALLOCATION, RISK MANAGEMENT, SAFETY NETS, SECTOR INVESTMENT, TAX COLLECTION, TAX EXEMPTIONS, TAX REVENUES, TRANSPARENCY, UNEMPLOYMENT, UNEMPLOYMENT RATE, WAGES,
Online Access:	http://documents.worldbank.org/curated/en/2004/10/6861572/grenada-oecs-fiscal-issues-policies-achieve-fiscal-sustainability-improve-efficiency-equity-public-expenditure https://hdl.handle.net/10986/13939
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