Koanapo explains VT8 billion budget decrease

November 7, 2024 9:57 pm | Posted in Business News | Share now Twitter Facebook

By Doddy Morris.

There is a decrease of VT8 billion in next year’s government budget compared to this year because the current budget was focused on infrastructure investments, allowing projects like airports and roads to continue over multiple years.

This was clarified by the Minister of Finance, Johnny Koanapo, during the second ordinary session of parliament yesterday.

He said the initial budget for 2024 was set at VT72. 2 billion, but the Kilman-led Government, through the Ministerial Budget Committee (MBC), increased the appropriation budget to VT79. 2 billion.

Koanapo explained that this increase is due to capital budgeting, where the government allocates funds specifically for investments in infrastructure, such as airports and roads.

“For next year’s budget, we didn’t include as much capital budgeting, though investment in infrastructure will continue for other projects,’’ he said.

“This is because the current implementation of programs and investments is already underway, making it challenging to fully utilize such a large budget within just a few months or even a year.

“That’s why we allocated an increased budget for this year, allowing implementation to extend over time, including next year, to continue spending part of the capital budget.

“This year’s budget is very reasonable and still allows for substantial infrastructure investments. We’re also addressing concerns for our teachers, with VT1 billion allocated for next year. We will discuss this further during the budget bill presentation.’’

He also mentioned that the government has allocated over VT800 million to address teachers’ concerns.

“We provided VT200 million initially, followed by an additional VT600 million based on the payment plan approved by the Council of Ministers, which the Teaching Service Commission, together with the Ministry of Education, is responsible for implementing,’’ he said.

“The process for disbursing this budget and allocating funds to teachers’ entitlements is managed according to legal and procedural requirements.

“In total, we have provided over VT800 million this year, and next year, we will allocate VT1 billion to their accounts. This VT1 billion comes from the current budget, not a supplementary budget, as the supplementary budget for next year has not yet been passed.’

“This year’s supplementary budget was used during the disaster months to address financial emergencies, as required by law, and I must report this spending to parliament.’’

Minister Koanapo said he has several bills to present, which he believes are necessary for the country.

He mentioned that one of the bills related to the digital economy, specifically regarding virtual assets, service providers, licensing, and processing.

“This bill is a significant step towards a cashless society, aligning with global trends where more people and economists use cards and digital payments—even biometric methods—for purchases,” he said.

He added that the transition is unavoidable, and Vanuatu must gradually shift from a cash-based economy to a digital one, and that the initiative is part of his broader vision to elevate the economy, embracing digital payments and a digitized economic infrastructure.

Minister Koanapo will present the Appropriation and Supplementary Bills, two key items for the second ordinary session of parliament.

Yesterday’s sitting was adjourned to Tuesday next week.