“The Marape-Rosso Government continues the important work of budget repair. This is hard work filled with difficult decisions. Massive pressures to increase expenditures to meet pressing development needs. Massive pressures to cut taxes. At the same time, we must keep repairing the budget so we can return to a budget surplus and start paying down our debt. This is a delicate balancing process. But it is one that we must get right for our people, and for the next generation” stated the Treasurer, Ian Ling-Stuckey.
“I am pleased that we have had a good report card on this important work of budget repair. The budget deficit is expected to fall from 8.9% of GDP in 2020 down to 3.2% of GDP in 2024. This is a rapid rate of budget repair in comparison to other countries. Growth continues to be strong, as confirmed by strong growth in tax revenues. Inflation forecasts have been lowered, but the cost-of-living pressures remain too high. These facts are all confirmed in the Mid-Year Economic and Fiscal Outlook, otherwise known as MYEFO, now available on the Treasury website.”
“In the first half of the year, the Government spent K10,904.1 million or 39.8% of the total Budget estimate. The expenditure was financed by total revenue of K8,981.5 million or 38.4% of the 2024 Budget estimate, resulting in a deficit financing of K1,922.6 million, or 48.2% of the 2024 Budget estimate. Expenditures and revenues are usually down slightly in the first half of the year.”
“The MYEFO tracks the strong growth in revenues, with a 15.8% increase relative to last year. This revenue growth is being achieved without new taxes. With tax cuts introduced as part of the 2024 Budget, a 15.8 per cent growth in revenues is only possible if there is also strong growth in the economy. More specifically, in terms of non-resource tax revenues, expected tax collections will be 9.7 per cent higher than in 2023, achieved without any tax increases.”
“There are expenditure pressures of K600 million from payments to our teachers and workers which are tracking higher than at budget time. This is welcome news as we should respect these vital service delivery functions through higher wages and more staffing. At the same time, we must then find cost savings elsewhere so that we can ensure we keep budget repair on track. These cost savings can be managed through prudent release of warrants during the remainder of the year.
“The 2024 MYEFO confirms once again the steady and responsible economic management of the Marape-Rosso Government. At the same time, the government knows hard work must continue as too many of our families are doing it tough. We will keep working, and this will be demonstrated once again in the 2025 Budget to be tabled in Parliament later this month” stated the Treasurer.
Hon. Ian Ling-Stuckey, CMG. MP
Minister for Treasury
13 November 2024