1. Budget Presentation to Nadi Chamber of CommerceBy
Dr Rohit Kishore
Fiji National University

2. Purpose of Government Budgets
Provide efficient management of the economy and accountability of public funds. Thus the budget should achieve the following objectives:
Whether the budget achieves its fiscal objectives?
Is the budget transparent and accountable; Accountability and Transparency!
Is the economic development commensurate with the size of the government expenditure?
Does the budget reflect the economic reality?
Does the budget promote sustainable development?

3. Basis of 2019/20 Budget
The five pillars as the key areas of focus of this budget:
Strengthening Law and Order,
Protecting the Natural Environment,
Empowering the Young,
Spurring Technology and Innovation and
Building Certainty in an Uncertain World.

4. 2019/20 Budget at a Glance

5. 2019/20 Budget at a Glance (Con’t)
Expenditure = $3.84 billion; revenue forecast = $3.49 billion, net deficit $349.2, = 2.7 percent of Gross Domestic Product
Reduction in about 1 billion expenditure
Reduction in number exercise and physical duties
Export income incentives
Full deduction for staff FNPF
Introduction ECAL on cars and white goods
Reduction in Plastic and Nabro Landfill Incentives
First home buyer scheme continues; Loan guarantee for 1.5m loan to housing authority at 0.05% fee

6. Economic Issues Economic Growth
Micro/Macroeconomics Factors (internal/external factors)
Import and Export, Current Account Balance and Foreign Reserve
Tourism Industry
Sugar Industry/non sugar agriculture sector
Resources Sector
Liquidity Issues
National Debt
Budget Deficit

7. Problems of Small Economy of a Developing Nation
Heavy reliance on government funding to provide economic stimulus/incentives, etc.
High expectations from government to provide most services free
Private sector is small and narrow focus
Limited foreign investments and FDIs
Weak manufacturing sector, every things money
No social security net/ heavy reliance on FNPF
High level of import with limited foreign reserve

8. Real Challenge of 2019/20 Budget
The Real Challenge; How is the 2019/20 budget going to stimulate the
much needed economic growth on the one hand, and reduce debt by
cutting expenditure on the other?
Expansionary Versus Contractionary budget polices
And to do so without increasing taxes and charges on businesses
And to continue providing all publics services; e.g.; health, education, support for low income earners, etc, etc

9. The major operating grants provided in the Budget include:
Water Authority of Fiji - $ 89.0 million
Fiji National University - $ 56.2 million
Fiji Revenue and Customs Service - $ 55.2 million
Judiciary - $ 54.4 million
Social Pension Scheme - $ 46.0 million
Poverty Benefit Scheme - $ 36.0 million
Free Education Year $ 33.6 million
University of the South Pacific - $ 32.0 million
Free Education Year $ 30.1 million

10. Land Transport Authority - $ 23.3 million
Bus Fare Assistance - $ 20.0 million
Fiji Roads Authority - $ 19.7 million
Grant to Fiji’s Servicemen’s After Care Fund - $ 11.7 million
Legal Aid Commission - $ 10.7 million
Parliament - $ 10.2 million
Bus Fare Programme for Elderly/ Disabled persons - $ 10.0 million
Tourism Fiji - $ 8.9 million
Child Protection Allowance - $ 8.0 million
Fiji Independent Commission Against Corruption - $ 8.0 million