The Ministry of Finance and Economic Management has put together a document containing a basic outline of this year’s government spending.
The 10-page ‘Citizens Guide to the 2024-2025 Budget’ breaks down the content of 2024-2025 Budget which Premier Joseph E Farrell presented in the Montserrat Legislative Assembly on 22 April.
Various sections of the guide include the economic context, budget at a glance, income statements, recurrent expenditure, new spend priorities and capital investments.
It also looks at the major tax and fiscal changes that directly affect the average citizen in Montserrat.
In her welcome remarks within the document, Financial Secretary Lindorna Sweeney wrote that the guide promotes the ministry and government’s “transparency and accountability”.
She said it equips residents with summarised information on the budget, discusses its preparation process, sources and uses of funds, and investment priorities in the year ahead.
Strong growth
The guide begins by introducing the budget themes of ‘transform the economy’, ‘protect our environment’ and ‘empower our communities’.
Within the ‘Economic context’ section, it says that Montserrat’s growth is forecast at 5% – exceeding the International Monetary Fund’s global forecast of 3.1%.
The hospitality sector is expected to have the highest growth followed by construction, sand mining and agriculture, the document explains using a bar chart.
The ‘Budget at a Glance’ page shows that the total government budget is EC$236.3 million – including $155.7 million for recurrent operations and $80.6 million for capital investment.
This will come from $100.2 million in budgetary aid and grant contributions and $55.5 million collected locally.
The locally collected income includes $51 million in taxes, licences, fees, fines and permits, $2.5 million in rent, interest, dividends and reimbursements and $2 million in other revenue.
According to a chart contained in the guide, international transactions and income tax will make up the majority of local revenue.
Priority spending
The guide then uses another bar chart to show which ministries the government will be investing the money into throughout 2024-2025.
The top three include the Office of the Deputy Governor, the Ministry of Finance and Economic Management and the Ministry of Health and Social Services.
A summary of the government’s ‘recurrent new spend priorities’ features next, with $2 million each going to healthcare transformation, port land-side development and government maintenance.
Another $1.5 million will be spent on agricultural product expansion, $1 million to community sports facilities and $1 million to the social security fund.
Half a million dollars will be spent each on safeguarding protection and capacity development, and another $42,000 on electric vehicle charging points, the guide says.
Tax cuts and more
The document then explains that “this year, the budget includes a number of significant tax changes and fiscal interventions”.
The income tax-free personal threshold is increasing from $15,000 to $18,000, it says, giving earners an additional $3,000 additional tax-free allowance.
Above that threshold, income tax bands are being simplified, and reduced, cutting taxes for all earners, the document continues.
For example, a worker earning $27,660 will now pay about $700 less in taxation.
Public service salaries will all increase by a further 3%, in addition to the 3% increase in 2023-2024, in a bid to support cost of living challenges, the guide says.
And the royalty revenue structure for sand mining is being actively reviewed to create a fair-market environment.
Capital investments
Finally, the guide details the government’s major investments in capital infrastructure and transformational projects during 2024-2025.
They include main construction beginning on the New National Hospital, the completion of the Little Bay port project, and the completion of the new parliament building design.
The commissioning and handing over of all buildings in the Montserrat Secondary School project, and the completion of the Salam Community Centre rehab are also listed.
Lastly, the government says it will be investing in geothermal infrastructure and energy efficiency.
The ‘Citizens Guide to the 2024-2025 Budget’ is available in full here.
