SUMMARY OF 2022/23 BUDGET PERFORMANCE
Mr. Speaker, the Government’s performance improved in the fiscal year 2022-
2023, despite the many challenges facing our country, the region, and the world. Some of those challenges, as mentioned earlier, include inflation, and global supply chain difficulties, resulting in supply shortages and increasing costs of doing business. This remains true for the private sector as it is for the Government. In addition, there were a few financing challenges that the Government experienced due to delays in funding approval for some projects and disbursements from funding agencies. This Mr. Speaker led to a general decline in Government expenditure, in particular in capital projects. Nevertheless, Mr. Speaker, government operations remained robust, while still managing to meet financial obligations through the effective and efficient management of its cash resources.
Mr. Speaker, my government continues to employ effective cash management
strategies and is responsibly working towards the reduction of the stock of payables. My Speaker, upon coming into office in July 2021, my government inherited payables – that is monies due to local suppliers of goods and services to the government – of over $200 million. Today this figure is a little over $100 million, a signal of our commitment to being responsible and trustworthy.
Despite these many challenges Mr. Speaker, the Government continues to make strides in meeting the needs of the population by putting people first. Mr. Speaker, we remain committed to delivering on our promises to the people of Saint Lucia.
Financing
Mr. Speaker, for the 2022-2023 fiscal year, I am pleased to report that the Government was able to stay within its budget ceiling and the economy performed much better than anticipated.
Mr. Speaker, preliminary data up to February 2023 indicates that the Government will be spending approximately $1.571 billion for the fiscal year 2022-23, which is higher than the actual in 2021-22 by 15.0 percent or an increase of $174.8 million but less than the approved estimates of $1.842 billion.
Mr. Speaker, as previously discussed, Government’s fiscal operations are expected to improve and a narrowing of the fiscal deficit is anticipated from a target of $394.6 million or 5.2 percent of GDP in the approved estimates to an estimated $150.2 million or 2.7 percent of GDP by year-end 2023.
In addition, a primary surplus of $29.6 million is anticipated in contrast to a primary deficit of $220.1 million. The projected outturn for this year anticipates total disbursements toward expenditure in the following manner:
- Revenue Grants – $1303.8 Billion
- Loans – $132,7 Million
- ShortTerm Borrowing – $124.8Million
- Refunds (Taxpayers) – $9.8 Million
TOTAL – $157.1 Billion
Mr. Speaker, due to the performance of the economy, a Primary Surplus is expected in the amount of $29.6 million in contrast to a primary deficit of $220 million initially projected in the approved estimates. In the year 2021-2022, the primary deficit was $156 million.
Mr. Speaker, the attainment of a Primary Surplus is one of the more important signs of a country’s fiscal health, as it indicates whether the country is contributing to the reduction of its debt.
Mr. Speaker, a deficit on the Primary Balance indicates that the country is NOT generating sufficient revenue to pay the interest on its debt, far less the principal. Such a situation implies that all interest and principal payments will have to be satisfied by borrowings; in other words, as the saying goes, we will be borrowing from Peter to pay Paul. Unfortunately, this is the situation that the country found itself in from 2019 to 2022 financial years.
Mr. Speaker, whereas the international financial community may be prepared to ignore such a situation for one or two years it will not do so indefinitely. Therefore, Mr. Speaker, as a fiscally prudent government it is important to us that the revenue we generate is sufficient to cover our current expenditure. Additionally, and more importantly, that we create some fiscal space to give us the latitude to address unforeseen events, whether they be external or internal when they arise.
Mr. Speaker, I will also like to indicate that given our fiscal management we project an Overall Deficit of $ 150.1 million compared to the $ 394.6 million in approved estimates and $324.4 million for the year 2022.
Mr. Speaker, let us examine some of the main expenditure items for the year
Wages and Salaries
For the year 2022-2023, Mr. Speaker wages and salaries were $566 million and are projected to be $568 million for the year 2023-2024. This is an increase of $36 million over the last year 2022 and $24 million or 41% less than was projected for the year ending 2023. This variance was due to the failure of certain projects to commence in the financial year.
I am pleased to announce Mr. Speaker, that the government has honoured all its wage obligations to Civil Servants as per the last Collective Agreement. All pay increases were honoured and back pay and salary increases of approximately $56.4 million.
This government’s unflinching commitment to the workers of Saint Lucia remains strong.
Debt Service Payments
Mr. Speaker, Saint Lucia continues to honour its debts. Total spending on debt servicing will register an increase of approximately $2.0 million to reach a total of
$287.1 million by the end of this fiscal year in comparison to the $285.1 million in approved estimates and $ 288 million in 2022. A total of $179.7 million is estimated as the outturn for Interest payments and $107.4 million is anticipated for Principal Repayments. Total loan payments $287.1 million.
Mr. Speaker, interest payments rose by 7.0 percent when compared to 2021-2022. Mr. Speaker interest payments for the coming year 2023-2024 are expected to be
$218.9 million and principal $ 112.2 million making a total payment of $ 331.1 million which is $44 million more than 2023 and 2022.
During the past few months, there has been a significant increase in international interest rates, such as LIBOR/SOFR rates, due to the actions taken by the United States Federal Reserve Bank in their attempt to quell inflation which ranged below
1.0 percent in January 2022 to over 5.0 percent in December 2022. Mr. Speaker, it is expected that Interest rates will continue to rise as follows
- 2021 – 2022 – Interest Expense $167.7 Million
- 2022 – 2023 – Interest Expense $179.7 Million
- 2023 – 2024 – Interest Expense $218.9 Million
Mr. Speaker, Members may be interested in how the collapse of Silicon Valley Bank and other international bank failures may affect our situation in Saint Lucia and the Eastern Caribbean Currency Authority. Mr. Speaker, the Central Bank advises that the ECCB foreign currency reserves are invested in the highest quality instruments and there was no direct exposure to Silicon Valley Bank, but diligent monitoring is warranted as the situation is both fluid and dynamic.
2022-2023 Revenue Performance
Mr. Speaker, permit me to now move to Government revenue performance for the fiscal year 2022-23. Preliminary data up to February 2023 indicates that the revenue generated by the economy continues to improve and will surpass pre- COVID levels.
Mr. Speaker, total Recurrent Revenue is projected to increase by approximately
5.0 percent to $1.21 billion compared to the $1.15 billion approved for the fiscal year. This performance is also expected to surpass the amount received in 2021- 22 by 14.8 percent. This outcome is driven by the recovery in economic activity causing improved performance in various revenue lines.
Mr. Speaker notwithstanding this performance, Excise Tax on Petroleum did not perform as anticipated. This is due to the extent of the subsidies provided to cushion the high cost of fuel and cooking gas experienced earlier during the year.
Mr. Speaker, the government budgeted to generate $56.9 million under that revenue head. However, given the increase in energy prices earlier in the year and the government shielding the consumer from absorbing the increase, it is expected that $25.41 million in revenue will be collected in 2023. Additionally, Mr. Speaker, whilst the government budgeted a subsidy of $6 million for the 20 and 22 Lb cylinders of cooking gas, it is now projected that the subsidy for the year will be approximately $14 million. Mr. Speaker, it, therefore, shows that the government would have forfeited approximately $40 million in revenue from petroleum products.
Mr. Speaker, despite the improved performance in Recurrent Revenue against the approved estimates, and actual revenue last year, Total Revenue and Grants are projected to fall short of the forecasted amount by an estimated $22.2 million. This is due to delayed grant receipts for projects as I have articulated previously.
I now move to this year’s budget proposal
2023-2024 BUDGET PROPOSAL
Mr. Speaker, this Government continues to deliver on its promises and plans as articulated in its 2021 Manifesto. These Budget estimates will seek to continue correcting the economic mess created by the previous administration, and there are many, and restore the social and economic fundamentals, necessary for growing the economy to enable wealth creation and prosperity for all.
Mr. Speaker, I would like to assure the people of Saint Lucia, that my government will do all within its power to ensure that the security of the country is not compromised and that law and order prevail.
We will ensure that St Jude’s Hospital is reopened and that the delivery of health services across the country is accessible, affordable, and equitable.
The vulnerable amongst us need our care and attention. Mr. Speaker, the COVID- 19 pandemic and its debilitating effects on the economic and social landscape of our country has left many persons poorer and, in some cases, destitute.
We will increase the allocation towards poverty reduction. My government intends to provide relief to those persons through the continuation of our many social programmes and by collaborating with social partners, committed to providing relief to those people.
Mr. Speaker, in support of our plans for economic expansion, we will create the enabling environment for businesses to expand and to be profitable. In the upcoming financial year, my government will be rolling out a number of programmes and initiatives to support MSMEs, empower the youth through the Youth Economy Agency, ensure the benefits of tourism are islandwide through the Community Tourism Project, provide for food security through the Blue Economy and diversification of the agricultural sector.
In this regard, Mr. Speaker to support this agenda, I wish to propose the following for the 2023/2024 Budget
Mr. Speaker these projections are realistic based on the environment under which we will be called on to operate.
- We propose to spend $1.856 billion.
- Out of this amount, $1.442 billion is proposed to be spent on Recurrent Expenditure
- $302.14 million on Capital Expenditure.
- $218.93 million on Interest Payments.
- $112.25 million on Principal Payments or Amortizations.
- Revenue and Grants
Revenue is expected to be $1.558 Billion comprising of:
- Tax Revenue $1.260 billion o Non-Tax Revenue $153.0 million o Capital Revenue $7.6 million
- Grants $147.04 million
- Refunds $10.0 million
Our statisticians are predicting a further increase in our GDP for the calendar year as GDP is projected at approximately $6 billion as compared to $ 5.5 billion in the current financial year. In 2021-2022 GDP was $ 4.91 billion.
In this upcoming Budget year, we intend to continue to reduce our liabilities/payables and obligations to third parties.
Mr. Speaker, I cannot over emphasise my government’s commitment to fiscal prudence as we intend to continue to maintain prudent macroeconomic indicators. Therefore, in the upcoming Budget, we are projecting a primary surplus of approximately 0.7 percent of GDP or $42.54 million. As compared to $29.5M an increase of 44% over this year.
Total expenditure, excluding refunds and principal repayments, is estimated at $1.734 billion while total revenue and grants are projected at $1.558 billion. When taken together, this results in the projected Overall Deficit of $176.4 million, equivalent to 2.9 percent of GDP as compared to 2.7% this year 2023, and 6.6% in 2022.
Recurrent Expenditure
Mr. Speaker, for the upcoming fiscal year, we are proposing an increase of $92.7 million in total recurrent spending, equivalent to a 6.8 percent increase when compared to the amount approved in 2022-23 and 15% less than actual for 2023 and 20% more than 2022. At $1.44 billion, Recurrent Expenditure represents 77.7 percent of the total 2023/2024 budget compared to 73.2 percent of the approved budget for 2022-2023 and 79% of 2023, and 75% of 2022. This change stems mostly from increases in Goods and Services and Transfer Payments.
Wages & Salaries
Mr. Speaker, the component Wages, and Salaries represent the largest recurrent expenditure and is approximately 31 percent of the upcoming Budget. For the 2023-24 Budget, a total of $568.6 million has been allocated for Wages and Salaries of which a sum of $529.0 million has been programmed to cover personal emoluments to central government employees while $39.6 million has been allocated to cover compensation and other benefits to project staff. A further sum of $116.3 million has been allocated to retiring benefits.
Debt Service
Mr. Speaker, debt service obligations are central to every budget as we continue to implement policies geared toward prudent debt management and reduction. Debt service payment allocation amounts to $331.2 million for the fiscal year 2023- 2024, an increase of 15.3 percent relative to the approved estimates for 2022/23 as principal debt payment becomes due combined with increases in the variable interest rates. A total of $145.5 million has been set aside to service domestic debts while $161.3 million has been provided for foreign debt servicing. Of the total amount $31.2 million is allocated for debt servicing, the interest payment amount to $218.9 million, and a sum of $112.3 million is provided for principal repayment. Principal Repayments are forecast to increase relative to the projected outturn for 2022/2023. Of the allocation for principal repayments, $66.0M is for externally contracted debt with the remainder ($46.3M) being programmed to cover the amortization of domestic debt.
Transfers
Mr. Speaker, transfer payments will increase by 12.6 percent over the approved 2022-2023 to amount to $239.1 million. This allocation also represents an increase of 17.0 percent over the outturn for 2022-2023.
This increased allocation will also provide a subvention to the Saint Lucia Tourism Authority of $8.0 million to support the re-opening of the Jazz and Arts Festival. The Jazz and Arts Festival is being re-introduced and we have committed to supporting this festival given its tremendous benefits to our people and the economy of Saint Lucia.
Mr. Speaker, many civil organizations and NGOs have been recommending and in some cases implementing several interventions aimed at creating social stability and citizen security. I am proposing Mr. Speaker that while the government insists that these interventions must be non-partisan I am recommending a sum of $100,000 to assist these groups with transportation and out-of-pocket expenses.
Mr. Speaker these estimates also increase government allocation to several non- government organisations involved in charitable and persons with disabilities organisations including for the first time Cerebral Palsy Association and Farmers with Disabilities organization.
Mr. Speaker the subvention to the National Trust continues in this financial year. Mr. Speaker several social interventions and access to the Distress Fund have been allocated a total of $78.1 million an increase of $16 million.
Goods & Services
Mr. Speaker, I now turn your attention to the expense item of Goods and Services. My government proposes an increase of 40.6 percent or $117.04 million, relative to the projected outturn for 2022-2023. The main driver of this increase is the reallocation of Personal Emoluments from the Respiratory Hospital to the Consultancy vote to be transferred to the Owen King EU Hospital to facilitate payment of salaries of staff that will transition there in the upcoming fiscal year. This represents approximately $21.7 million. Other contributors to this increase include project support for capital projects commencing in the upcoming Budget year and terminal disbursements as large projects such as the Disaster Vulnerability Reduction Project (DVRP) and the OECS Regional Tourism Competitiveness Project (ORTCP) come to an end.
Development /Capital Expenditure Budget
Mr. Speaker, allow me to briefly deal with the Capital expenditure proposals for 2023- 2024. I trust Ministers will deal in more detail with projects under their portfolios.
As I discussed earlier Mr. Speaker, many of our projects were delayed in 2022 due to the late disbursements of funds. We expect the commencement of those projects in the upcoming fiscal year. As a result, a total amount of $460.8 million including both recurrent and capital expenditures has been allocated toward the implementation of capital projects for the next fiscal year.
Mr. Speaker, as it relates to Capital Expenditure for the new fiscal year, my government has allocated some $302.1 million to its capital programmes. This amount is made up of $116.1M in locally funded Capital expenditure and $186.1 million in externally funded Capital Expenditure. The proposed capital budget represents a 21.0 percent decline over last year’s revised estimates. It is important to note that capital expenditure constitutes 65.6 percent of the total Projects budget of $460.8 million.
Of the total allocation of $460.8 million for development projects, an amount of $130.3 million or 28.3 percent of the total is proposed for the Department of Infrastructure, Ports, and Transport. This amount will cater for payment of new and outstanding DFCs, advancement of the works on the Millennium Highway/West Coast Road, the Road Improvement Project, and the Renewable Energy Sector Development Project.
Mr. Speaker, the Department of Economic Development and the Youth Economy have been allocated the second largest share of the development budget of $94.0 million, accounting for 20.4 percent of the resource envelope for the fiscal year. The lion’s share of the development programme for the department goes to primarily 4 major projects, namely, the Disaster Vulnerability Reduction Project ($19.8 million), Constituency Development Project ($21.7 million), St. Jude Hospital Reconstruction Project ($32.7 million), and for the implementation of the Economic Recovery and Youth Empowerment Project ($5.3 million).
Mr. Speaker my government is also proposing to allocate $27.3 million or 6.0 percent of the development budget to the Department of Health to support the Health System Strengthening Project, the OECS Regional Health Project, Emergency Response COVID-19 Project, and others including the Rehabilitation of the Mental Wellness Center, the relocation of the Castries Health Center, recommissioning of the La Ressource Health Center, preliminary works on the Soufriere Hospital, repairs and equipment for Wellness, increase allocation to St Jude and OKEU hospitals and financing of initiatives leading to Universal Health Care. It is proposed that in the year 2023/2024 we would have allocated $221.2 million toward health-related expenses.
Mr. Speaker, our citizens’ security is of ultimate importance and I have allocated $177.11 million toward the National Security Budget.
Mr. Speaker, we continue to work with our international partners such as the European Investment Bank, the World Bank, the Caribbean Development Bank, and International Development Bank, to support initiatives to strengthen the country’s resilience since the COVID-19 pandemic as a number of our projects continue to be dedicated to this effort.
Mr. Speaker, the Department of Agriculture has also been allocated a sum of $21.6 million of 4.7 percent of the development budget to facilitate the implementation of new and ongoing projects such as Repairs to the Choiseul Fishing Port, Expansion of Food Crop Production, Cocoa Sector Enhancement, Enhancing Energy Efficiency for Agro- Processing with Solar Photovoltaic Power and also to undertake various initiatives aimed at protecting food security.
Mr. Speaker a sum of $ 22.1 million or 4.8 percent of the development budget is also being proposed on behalf of the Department of Education for the upcoming year. Of the total amount allocated to the department, 41.0 percent will cover the cost of activities under the EQIP Project. A sum of $3.2 million has been allocated for the rehabilitation of schools.
Mr. Speaker, in the policy statement to be delivered at the end of April, I will outline further details on initiatives on the Capital programme, some of which will be financed by other means.
2023-2024 REVENUE
Mr. Speaker, these estimates have been prepared with the utmost care and reality, taking into consideration the resources that will be required to finance this Budget. An effort was taken to include projects where financing is either finalized or approved by funding agencies.
The draft estimates are projecting total revenue and grants in the sum of $1.558 billion to fund the expenditures programmed for the new fiscal year. Total revenue and grants are forecast to increase by $254.2 million or 19.5 percent above the preliminary outturn for the fiscal year 2022-2023. The forecast comprises $1.41 billion in Recurrent Revenue, $7.6 million in Capital Revenue, and $147.0 million in Grants. Grant receipts are expected to contribute an additional $46.0 million compared to the 2022-23 outturn of $22 million. This increase is due to the Millennium Highway/West Coast Road which is expected to progress this year and the receipt of grant funding from Taiwan.
The total projected recurrent revenue for 2023-2024 comprises Tax Revenue of $1.260 billion or 89 percent and $153.0 million in Non-tax Revenue. Tax Revenue is forecasted to increase by 17.3 percent as compared to 2022-2023 while non-tax revenue is expected to increase by 13.1 percent compared to 2021-2022.
Mr. Speaker, the recovery in economic activity, improved tax compliance, and returns from the ongoing tax amnesty are among the reasons for the improved performance. Higher anticipated CIP inflows of $91M account for the increase in non-tax revenue.
Recurrent Revenue
Mr. Speaker, allow me to speak on the recurrent revenue in this Budget Summary.
The 2023-2024 estimates show current revenue of $ 1.41 billion which is an increase of $ 204.3 million or 17% over the year 2022-2023 and $ 263 million over the approved estimates of 23%. Mr. Speaker, based on the projected expansion in economic activity this target is achievable.
Mr. Speaker, allow me to detail the main items in tax revenue as compared to the projected 2022-2023 – the approved estimates for 2022-2023, and the actual for 2021-2022.
Taxes on Income Profits
2023 – 2024 – $280.3M – Projected
2022 – 2023 – $259.2M – Actual
Increase over actual $21.1M – 8%
2021 – 2022 – $243.1M – Actual
Increase over
2022 – 2023 – $16.1M or 6%
Approved Estimates
2022 – 2023 – $256.1M
Increase over
2022 – 2023 – $24.2M or 9%
Mr. Speaker based on the performance of the economy and the tourism industry in particular the revenue figures are realistic and achievable.
Taxes on International Trade
2023 – 2024 – $277.3M – Projected
2022 – 2023 – $220.1M – Actual
Increase over actual $57.2M – 26%
2021 – 2022 – $211.9M
Increase over
2022 – 2023 – $24.5M – 11%
Approved Estimates
2022 – 2023 – $236.4M
Increase over
2023 – 2024 – $40.9M or 17%
Tax Revenue
Taxes on Income and Profits
Taxes on Income and Profits are projected to amount to $280.3 million, above the revised estimates for 2022-2023. This outturn expects increases in all the components of this category of revenue, namely income tax from corporations, income tax from individuals, withholding tax, and arrears. The projection for the main items under this category is as follows:
Income Tax – Corporations
The revenue from Income Tax – Corporations is expected to generate $86.5 million for the financial year 2023-2024 representing an 18.4 percent increase above the budgeted amount in 2022/2023, and a 17.1 percent increase above the outturn for 2022-2023 budgetary amount. This performance is indicative of the recovery that is going on in the private sector.
Income Tax – Individuals
Revenue from Income Tax – Individuals income tax is estimated at $116.8 million. This represents a 1.7 percent increase from the 2022-2023 revised estimates.
Income Tax – Arrears
Income tax arrears is projected at $56.4 million, an increase of $14.7 million or 35.2 percent from the outturn in 2022/2023. The projected increase is expected to be driven by increased economic activity and the collection of arrears due to the ongoing amnesty.
Taxes on International Trade Transactions:
Mr. Speaker, taxes on International Trade (custom duties) are projected to increase by 26.0 percent to reach $277.3 million in 2023-2024, up from the revised estimates of $220.1 million in 2022-2023. Of the total amount to be collected from taxes on international trade transactions, $156.3 million is expected to come from Import Duty, $112.7 million from Excise Tax, $1.6 million from Through-put Charges, and $6.8 million from Passenger Facility Fee.
Taxes on Domestic Goods and Services
Taxes on domestic goods and services are expected to generate $687.5 million which is 17.7 percent above the revised figure for 2022-2023. This category includes Value Added Tax (VAT) on domestic activity (collected by the Inland Revenue Department), excise tax, and use of goods and permissions. Receipts from VAT collected by Inland Revenue Department account for 33.0 percent of revenue from this category and are projected at $226.0 million which represents a 21.8 percent increase relative to the 2022-2023 outturn.
VAT from international trade transactions – collected by the Customs and Excise Department is projected to yield $246.6 million in 2023-2024, which is 22.7 percent above the outturn of $201.0 million in 2022-2023. This increasing trend in revenue is expected as the economy normalizes and growth in key sectors such as construction, tourism, wholesale and retail trade is anticipated.
Mr. Speaker Airport tax is projected to record an increase of 5.8 percent above the 2022-2023 outturn to reach $37.1 million for the new fiscal year. This category impacts stayover arrivals for the period 2023-24, it is anticipated that this category of visitors will increase by over 10.0 percent.
Service Charge on Imports is projected to increase by $14.6 million or 16.0 percent above the outturn for 2022/23 to reach $105.9 million for the new fiscal year. This projection is influenced by the higher revenue intake anticipated as the tourism industry rebounds
Mr. Speaker Revenue collections from Taxes on Domestic Goods and Services account for 48.6 percent of total recurrent revenue.
Non-Tax Revenue
The 2023-2024 projection for non‐tax revenues amounts to $153.0 million, or a 13.3 percent increase over the 2022-2023 outturn. The main contributor to the increase in inflows during the current fiscal year is expected to be the contribution by the National Economic Fund and the Sale of goods and Services. The following are the major components of non‐tax revenues and their expected performance in 2023-2024:
Voluntary Transfers- Other Than Grants
Mr. Speaker, the Citizenship by Investment Programme (CIP) is expected to deposit anticipated of $91.6 million into the National Economic Fund as is required by law. Overall, revenue from Voluntary Transfers is estimated to increase by $24.7 million or 37.1 percent over the outturn for the 2022-2023 fiscal year.
In-Transit Fees
Mr. Speaker, receipts from In-Transit Fees are projected to decrease by 70.3 percent to $1.2 million when compared to the outturn for 2022/23. This decline is reflective of the advanced efforts by my government to improve the cruise ship berthing facilities in Castries and Soufriere. Mr. Speaker, more details will be provided in my policy statement on this initiative which is expected to have long- term development of our port facilities.
Sale of Goods and Services
Revenue collections from the Sale of Goods and Services are projected to record a sum of $49.4 million, reflecting a decrease of $9.7 million or 16.4 percent below the revised estimates for the previous financial year. The major revenue lines contributing to the decrease are (1) revenue from drugs and vaccines – due to low incidence of Covid infection; (2) decline in motor vehicle licenses – increases in this line are observed every triennium, the last one being 2022-2023; (3) decline in passport fees; (4) decline in contribution to the Medical Board; (5) laboratory fees of $8.3 million including Motor Vehicle Driver’s License and Sale of Drugs and Vaccines.
Grant Revenue
Grant revenue receipts are estimated at $147.0 million reflecting a $46.0 million increase over the projected outturn for the 2022-2023 fiscal year. This amount represents 48.7 percent of the total capital expenditure programmed for the new fiscal year to be funded for the continuation of projects. Some of the major contributors to the grant inflows are the Japanese International Cooperation Agency (JICA), the Taiwanese Government, the UK Caribbean Infrastructural Partnership Fund (UKCIF), the European Development Fund (EDF), the Caribbean Development Bank (CDB), and the United Nations Environmental Programme (UNEP).
Mr. Speaker, we believe that these figures are attainable.
Another notable increase in revenue is the increase in transfers due to a projected increase in CIP revenue. I am sure that at the right time, the Minister responsible will give further details.
Mr. Speaker, the 2023-2024 budget is realistic and aims at building on the proven gains of the economy this year.
The budget projects an overall deficit of $176.4M or (2.9%) of GDP as compared to the outturn (2.7%) for the year 2022-2023.
Mr. Speaker, when compared to previous years and considering the primary surplus of this year and last year the deficit is reasonable. Mr. Speaker the actual deficit for 2021-2022 was (6.6%) and (7.2%) was projected that year.
Mr. Speaker despite the performance we aim at a balanced budget at the earliest. This is our aim out of an abundance of caution, this is the plan which we hope to achieve (I hope I am not misquoted).
Mr. Speaker, consistent with government policy our borrowing to finance the deficit will be to secure external borrowing on concessionary terms instead of short-term instruments. I have spoken on the interest rates issue Mr. Speaker earlier in my presentation.
Mr. Speaker, you will note that as I said earlier our capital projects were delayed since our borrowing commitments were not all honoured.
Mr. Speaker, I propose to finance the short-fall as follows:
