Introduction

In accordance with the Fiscal Resilience Act, the Fiscal Resilience Oversight Committee (FROC) submitted the FROC 2025 Annual Report and a summarised version of the Annual Report (The FROC 2025 Annual Report At A Glance) to the Clerk of Parliament on 13 March 2026 for onward submission to the Honourable Leo Cato, Speaker of the House of Representatives and Chairman of the Committee of Privileges for the consideration of the House of Representatives.

On 19 and 20 March 2026, the reports were distributed to the public, and the Press Briefing was convened on 26 March 2026.

The following question was submitted to the FROC electronically.

• The Extension of the Suspension of Section 9 of the Fiscal Resilience Act

 The Query

Whether the extension of Section 9 (Suspension Clause) of the Fiscal Resilience Act into 2026 is Justifiable.

Response

The FROC is mandated to report on compliance with the Fiscal Resilience Act, and concluded that the Government complied with the provisions of the Act for the suspension of Section 9 (Suspension Clause) for 2025 and into 2026. The Government complied with the required legislative process for the extension of the Suspension Clause. To determine the justification for the extension, the FROC identified the direct Hurricane Beryl-related capital expenditure as recorded in the 2026 Estimates of Revenue and Expenditure and referenced the other policies and programmes that impacted Central Government operations. The FROC noted that the revenue and expenditure effects of Hurricane Beryl continued into 2025 and 2026.

The following is the analysis as extracted from the FROC 2025 Annual Report.

With the passage of Hurricane Beryl, Section 9 of the FRA was activated for 2024. The suspension of Section 9 of the FRA was extended to 2025, and with the budgeted primary deficit for 2026, the suspension was further extended to 2026.

In accordance with the Fiscal Resilience Act, the suspension of the primary balance and debt target (Section 9 of the FRA) for 2025 and 2026 was approved by the House of Representatives on submission of the Fiscal Resilience (Suspension of the Public Debt Target and Primary Balance Rule) (Extension) Order, 2025 and the Fiscal Resilience (Suspension of the Public Debt Target and Primary Balance Rule) (Extension) (No. 2) Order, 2025, respectively.

On examination of the fiscal accounts, both current and capital expenditures were elevated in 2025 and 2026, influenced, in part, by the response to the impact of Hurricane Beryl. To assess the validity for the extension of the Suspension Clause, the FROC examined the capital expenditure associated with Hurricane Beryl, as identified in the Estimates of Revenue and Expenditure, that contributed to the higher capital expenditure. The direct Hurricane-related capital expenditure amounted to $97 million in 2025 and $27 million in 2026.

The expenditure, identified in the Estimates of Revenue and Expenditure, excludes Hurricane Beryl-related capital expenditures that are integrated with other ongoing capital projects, such as house repairs, asphalt and concrete road works and the recurrent expenditure that was associated with Hurricane Beryl. The impact of the tax relief on recurrent revenue is not detailed in the Annual Report.

The FROC therefore concludes that the Government complied with the provisions of the FRA regarding the suspension of Section 9 for 2025 and 2026. The wage bill remains within the cap set in the FRA.

The Central Government operations are projected to be in surplus and in accordance with the fiscal rules for 2027 and 2028. The debt to GDP ratio is projected to increase in 2027 and, based on the Debt Sustainability Analysis as prepared by the IMF, remains on track to achieve the targeted debt to GDP ratio by 2035.

Contact Information

The Fiscal Resilience Oversight Committee (FROC) will readily respond to queries related to the Fiscal Resilience Act and the functioning of the FROC, which are submitted via email at [email protected]. Access information on the Fiscal Resilience Act and the Fiscal Resilience Oversight Committee on the FROC website. Follow the FROC on its Facebook and LinkedIn pages and/or visit the FROC office at the Kirani James Athletics Stadium.

Laurel Bain, Chairwoman, Fiscal Resilience Oversight Committee
5 May 2026

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