The Mia Mottley administration is expected to spend one-third more during the coming financial year — $4.66 billion — to support central government operations. This is on the accrual accounting basis or $4.59 billion on the cash basis, the government said late Tuesday night.
Roughly one in three dollars will be spent on paying down the country’s debt.
When it comes to revenue, however, the administration is projecting it will rake in $3.72 billion ($3.54 billion on the cash basis) from taxpayers and other sources over the next 12 months, starting April 1 — a quarter-billion dollar deficit.
The administration’s plan for the Appropriation Bill setting out the Estimates of Expenditure and Revenue for the 2024-2025 fiscal year was outlined in a press statement issued by the Ministry of Finance and Economic Affairs, as the administration prepares to debate the estimates in the House of Assembly starting on February 27.
Healthcare and university education get the largest slices of the government’s spending pie, with extra allowances for public and childrens’ welfare, hosting the ICC T20 World Cup and road rehabilitation.
In 2007, Parliament enacted the Financial Management and Audit Act, which adopted the accrual basis International Public Sector Accounting Standards as the financial reporting standards for the public sector.
According to the Ministry of Finance, on the cash basis, it will be raising $322.6 million more in 2024-2025 than it did last year when it collected $3.22 billion through taxes and other means in 2023-2024.
Importantly, the Ministry of Finance stated that spending is expected to jump by almost 32 per cent or $1.10 billion more than the revised spending figure of $3.48 billion in 2023-2024 on the cash basis.
Breaking down the spending, the administration said $3.42 billion represents planned current expenses, while $1.24 billion will go towards capital expenditure and amortisation.
Of note, the Ministry of Finance stated that next financial year which starts on April 1, itplans to repay $1.60 billion of principal and interest on government debt.
While the administration is expected to spend more on goods and services, transfers to state agencies have been cut, in keeping with the persistent demands of the International Monetary Fund (IMF).
The finance ministry said: “Expenditure on goods and services is expected to increase by $62.8 million over the revised figure for 2023- 2024 to $635.3 million. Current transfers are projected to decrease by $61.8 million or 5.5 per cent to $1 056.4 million [$1.05 billion].
The government has signalled that it expects a shortfall of $251.9 million.
“When amortisation of $817.8 million is taken into account, a deficit of $251.9 million on the cash basis is expected, representing 1.8 per cent of GDP, estimated at $13 964.3 million [$13.96 billion],” the ministry statement explained.
“The primary balance is projected to be a surplus of $558.6 million, representing 4.0 per cent of GDP on the cash basis.”
Explaining where the administration plans to spend the country’s tax dollars and other funds being raised in the 2024-2025 financial year, the ministry outlined: * The Queen Elizabeth Hospital is to receive a subvention of $100.9 million. This is down from the $139 million assigned to the QEH in the last Estimates.
* The University of the West Indies (UWI) benefits from financing totalling $131.1 million of which $98.4 million is for economic costs and $32.7 million for tuition fees. This is an increase on the total of $122.8 million provided to the UWI in the last Estimates.
* To host the ICC Men’s T20 World Cup Government is injecting $9.8 million.
* The CAF road rehabilitation programme will be assigned $15.0 million.
* The Welfare Department is set to receive $33.5 million, just $1 million more than 2023-2024 financial year, while $10.4 million will go to the Elderly Care Programme.
* A subvention of $20.6 million will go to the Child Care Board, the same amount assigned in the last Estimates.
* $8.2 million will go to Invest Barbados.
* $1.6 million for the Change Management Unit in the Ministry of Education.
* $4.6 million for the upgrade to Consett Bay boatyard and repairs to the west jetty and haul-up facilities at the BridgetownFisheries complex.
* $3.6 million will be spent on the West Wing of Parliament.
* $6.0 million for the female dormitories at the Police Training School.
* $6.9 million goes to Hope Agriculture Training Institute and the UWI Centre for Food Security and Entrepreneurship (China Aid Project).
* $11.9 million is to be spent on the schools’ digital technologies programme.
(SD/IMC1)
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