Government’s Budget, setting out the Estimates of Expenditure and Revenue for the financial year 2021-2022, was yesterday (Friday, February 18) laid in Parliament, together with a projected forecast for the current financial year 2021-2022. These will form the basis of the Parliamentary Debate to ensue from February 21, on the Appropriation Bill.
Revised Fiscal Balance 2021-2022
On the cash basis current revenue of $2,625.2 million is expected, of which $2,477.3 million is tax revenue and $142.2 million is non-tax revenue and grant income. Total expenditure is projected to be $3,494.5 million, of which $2,827.7 million is current expenditure, exclusive of amortization, and $290.7 million is capital expenditure. The revised deficit of $493.2 million, on the IFI basis, represents 4.9% of GDP at market prices. The primary deficit for the financial year 2021-2022 is estimated to be $93.4 million or 1.0 % of GDP on the cash basis.
It is estimated that Government’s total expenditure for the financial year 2022-2023, on the accrual basis, will be $3,735.6 million. When converted to the cash basis, total expenditure is $3,680.6 million, an increase of $186.1 million or 5.3% over the revised figure for 2021-2022. Of the amount approved for the 2022-2023 financial year, $2,996.9 million represents current expenditure and $738.7 million represents capital expenditure and amortisation.
Expenditure on goods and services is expected to increase by $76.0 million over the revised figure for 2021-2022 to $522.0 million. Current transfers are projected to decrease by $63.0 million or 5.6% to $1,059.6 million.
The repayment of principal and interest on Government’s debt is expected to account for $981.5 million compared to the revised projection of $775.9 million.
On the accrual basis, current revenue for the next fiscal year is projected at $3,206.6 million. On the cash basis current revenue is projected at $2,813.3 million, an increase of 7.2% over the revised revenue of $2,625.2 million for the financial year ending March 2022.
When amortization of $480.5 million is taken into account, a deficit of $386.6 million on the cash basis is expected, representing 3.3% of GDP.
The primary balance is projected to be a surplus of $114.3 million or 1.0% on the cash basis and $426.0 million on the accrual basis.
The Estimates for the 2022-2023 fiscal year include provision for the following activities:
(i) A current subvention of $125.0 million is being provided to the Queen Elizabeth Hospital for its operations in addition to the $7.99 million for management of Covid-19;
(ii) Invest Barbados has been allocated the sum of $7.5 million to carry out its operations;
(iii) $6.0 million has been provided for the IDB Road Rehabilitation Programme;
(iv) $2 million has been provided for the Scotland District Road and Rehabilitation Project to be funded by the Chinese;
(v) $7.6 million has been provided for the CAF Road Rehabilitation Project;
(vi) An amount of $10.0 million has been provided for Programme Management – Covid-19;
(vii) $11.7 million has been provided to carry out capital works at Secondary Schools;
(viii) $7.5 million has been provided to the Primary Education Domestic programme;
(ix) An amount of $30 million has been allocated to the Barbados Water Authority to upgrade its reservoirs and the water distribution network.