2024-2025 National Budget address by the Minister for Finance Prof. Biman Prasad.
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FCCC to explore price controls and fair profit margins if theAs a comprehensive market study into the grocery retail sector continues, the Fijian Competition and Consumer Commission says while it is important for businesses to make a reasonable profit, exorbitant price margins for important items are not ideal, especially with the current economic concerns.
While speaking about the current surveys and cost of living, FCCC Chief Executive Officer, Joel Abraham says in the past, they have seen some traders try to take advantage of the National Budget announcement to exorbitantly raise the prices of items, far beyond what might be expected from the announced changes.
He says prior to the budget, 160 surveys were carried out nationwide by FCCC teams to collect and establish baseline data and market prices for non-price-controlled items.
Abraham says this is so that after the budget, they have the required data to ensure that traders are not hiking the prices of goods and services to unfairly benefit from the budget announcement.
So far, following the budget, they have had 44 price surveys.
Their major line items currently under monitoring are Canned Fish (Local), Corned Meat, Toothpaste, Washing Powder, Dish Washing Detergent, Soap and Shampoo, Noodles, Assorted Biscuits, Baking Items, Whole Chickens, Chicken Portions, Lamb, Sausages, Baby Diapers, Sanitary Pads, Spare Parts, Stationery, Agricultural Products, namely pesticides, weedicides, fertilizers etc.
While speaking on recommendations, the FCCC says imposing price regulation is not the first policy choice, as FCCC seeks to promote market driven solutions.
Abraham says some of the items are not currently price-controlled but are still important to consumers and critical livelihoods.
He says based on the top selling products in major retail outlets, FCCC is monitoring these high volume essential and household grocery items closely, which will continue in the following weeks, and necessary recommendations will be proposed thereafter.
The FCCC says this may be in the form of price control for some of these items based on their assessment of the data that they are currently collecting through these surveys, as well as market studies and inquiries.
In addition to price control, they are also exploring potentially capping retail margins for some of these items.
However, they emphasise that any decision will be based on the findings of our the inquiry.
This will involve a thorough analysis of wholesale and retail margins, with possible recommendations of a new margin structure, whilst ensuring fair returns for stakeholders.
The FCCC will also review products and sectors that have been protected through duty and/or tax concessions.
This will involve assessing the impact that these concessions have at the retail level to determine how the benefits are being passed onto consumers and if there are areas that can be improved in this regard.
They say they understand that the issue of cost of living is very important and in line with their regulatory mandate to ensure a competitive, effective, efficient, and sustainable marketplace for all Fijians, their teams have been on the ground before the budget announcement.
Understanding the economic pressure faced by Fijians, the FCCC says it is particularly focused on reviewing cost structure to confirm that no Fijian consumer is being charged more than what would constitute a fair price.
While speaking on the market inquiry into the grocery retail sector, Abraham says the team has begun phase 1 of the study which is gathering data and information from relevant stakeholders.
So far, 47 stakeholders have been provided with a notice to furnish FCCC with the relevant documentation needed to carry out the market inquiry assessments.
Once phase 1 is completed, phase 2 will commence, and this involves tabulating and verifying the data and information.
This study will cover the status, size, structure and characteristics of the grocery retail sector market, including the market demand and supply and the nature of competition across the supply chain.
The factors affecting consumption patterns and trends in the sector will also be explored.
Abraham says the FCCC is particularly committed to closely monitoring the retail sector in the weeks following the announcement of the National Budget 2024-2025 to protect consumers.
He warns any traders who may be thinking of taking advantage of the transition period following the budget as changes are implemented that the FCCC will continue to keep a close eye on the retail sector in the coming weeks.
He stresses any unethical pricing practices will be dealt with severely, with offenders facing the full brunt of the law.
Following questions raised about the increase in the budget for the Republic of Fiji Military Forces and what purpose it serves, Deputy Prime Minister and Minister for Finance Professor Biman Prasad has clarified that the allocation for RFMF in the 2024/2025 National Budget also includes peacekeeping so it is not an increase in $60 million as being claimed.
He highlighted this while responding to USP Professor Vijay Naidu during Dialogue Fiji’s Post Budget Forum where Professor Naidu says a good $60 million additional expenditure is being made to the RFMF, the same military that has caused disaster after disaster.
Professor Naidu asks what productivity gains the RFMF brings to the economy and society.
Professor Prasad had referred further questions regarding the specific budget allocation to Permanent Secretary for Finance, Shiri Gounder who says the increase in military budget is $10 million and not $60 million as being reported.
He says they have merged the peacekeeping component and the normal RFMF operations.
Gounder says from the $10 million, $5 million is allocated for the RFMF’s engineering department and the revenue from there is going to the government now.
He also says the other $5 million is for procurement of some of the contingent equipment for the peacekeepers where there were some challenges.
While responding to Gounder, FNU lecturer Dr Mosmi Bhim says Fiji pays for peacekeeping and does not make money from it and the expenditure is not just for equipment but it is to train and pay for the extra soldiers.
She says not only are we paying for the expense of peacekeeping, we are training the soldiers to do coups in Fiji.
Dr Bhim further asks instead of giving preferential treatment to the military in terms of pay allowances and other things, the same amount could be given to law enforcement officers and we might see a much better law and order situation in Fiji.
Professor Prasad later highlighted that the Fiji Police Force has a bigger budget than the military.
RFMF is allocated a total of $169.6 million in the 2024-2025 budget while $226.8million has been allocated for the Police Force.
In the 2023-2024 budget, the RFMF was allocated $103.1 million and $57 million was for peacekeeping.
The government’s transport assistance for students has increased from $20 million to $37 million to cover full bus fares for students effective from 1st August 2024.
The Fiji Bus Operations Association says the 2024/2025 National Budget delivery is commendable by the government.
Association President, Richard Lal says the government must work to balance national priorities and aspirations within the financial and resource constraints to increase the transport assistance for children.
Lal says bus operators have carried school children at 50 percent discount for more than 50 years.
They want government to recognize that providing such assistance is the social responsibility of the State and not private enterprises.
As the national minimum wage is being increased to $5 per hour, the Fiji Trades Union Congress says they welcome the adjustment and they would have preferred it to be effective immediately but we can understand that employers do need time to readjust to the new wage rates.
In an interview with fijivillage News, FTUC General Secretary, Felix Anthony says they also look forward to the Government reconsidering in the next budget a further increase to $6 as they claimed and hopefully not too far in the future, workers in this country will enjoy a living wage.
When questioned on his opinion with regards to a 7 to 20 percent pay rise for civil servants, Anthony says they welcome that pay increase and believes that for the first time, any Government has given such a big increase.
He says the civil servants' demands are much more than that and he believes that that is something for further negotiations with the Public Service Commission and probably a job evaluation exercise to ensure that they achieve what they are demanding.
When questioned on the FTUC’s stand on the increase in pay for MPs, the Speaker and the President, Anthony says Deputy Prime Minister and Finance Minister Professor Biman Prasad did clarify that the overall increase is around $4 million and not $8 million or whatever was claimed before.
$3 billion in tax revenue is expected to be collected by the Fiji Revenue Customs Service by the end of this financial year which is probably the highest ever FRCS would collect.
Deputy Prime Minister and Minister of Finance Professor Biman Prasad highlighted this during the Post-Budget Breakfast this morning where he further said that if they do not implement with efficiency and effectiveness, then the intent and the objectives of some of those policies and allocations in the budget may not turn out to be as good as they intend them to be.
Professor Prasad says as a government, they have set out a foundation of policies that they felt will provide a sustainable framework which cannot only grow the economy but also over some time, reduce the country's debt to GDP ratio and reduce the deficit.
He says it's in their interest to address this fundamental issue by setting out a budget last year with some hard decisions on revenue, and tax reform and being able to bring in an additional $600 million in revenue and reduce the deficit to 4.8 percent from a double-digit deficit of the past.
The Minister for Finance says in terms of the debt to GDP ratio, they are able to reduce it to 78 percent and by the end of this financial year, it will be down to about 77.8 percent.
As the national minimum wage is progressively being increased to $5 an hour and there are concerns that the increase in the cost of doing business will be passed down to consumers, Fiji Commerce and Employers Federation says businesses have put in place strategies to ensure that they can absorb what they can.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad has made a call to businesses to not pass this increase to consumers just because it is going to raise the cost of production.
He says it will be unethical for businesses who can afford to pay the increase to pass those increases in cost on to the consumers.
While responding to questions by fijivillage News, FCEF CEO Jonetani Tonawai says they are happy with the progressive approach that has been taken by the Government as this is what they had suggested.
He says in the short to medium term, the businesses have been prepared in the slow progression of things as opposed to a big jump.
He says at the end of the day, the cost of doing business will be important for the businesses and the two things they will consider is the ease and the cost of doing business.
Effective from 1st August 2024, the national minimum wage will be increased to $4.50 an hour with a further increase to $5.00 an hour effective from 1st April 2025.
As the Government intends to take steps over the next six months towards the corporatisation of the Water Authority of Fiji, Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says if the question of tariff and other things arise, then the FCCC will look at it and determine what is the right tariff.
He says WAF is already deemed to be a so-called “commercial statutory authority” but its operations are anything but commercial.
Professor Prasad says WAF which has been provided a total budget of $259.4 million in the 2024-2025 National Budget, receives about one-tenth of the income it needs to operate and invest sustainably.
He says this is because, for years, and mostly for political reasons, previous Governments have refused to confront reality.
Professor Prasad says WAF’s poor funding model means that it is wholly dependent on the Government for the money it needs and Government can only give to WAF whatever it can afford from year to year.
He says for much of the last 10 years WAF has been dependent on Government grants which are only made known to it every six months.
The Deputy Prime Minister says this makes it impossible to plan large expenditure or to borrow money for investment, except through the Government with the support of bilateral funders such as the Asian Development Bank and the European Investment Bank.
He says these loans and project funding can take a long time to organise, so WAF does not have a business model that would enable it to plan and build autonomously, even though it is supposed to be commercially independent and under the control of its own board.
While responding to questions by fijivillage News, Professor Prasad says corporatisation would require looking at every aspect of the organisation.
Meanwhile, WAF CEO Dr Amit Chanan had earlier said that WAF is considering full corporatisation and increasing water tariffs to make it more viable and to reflect the true cost of service provision.
While speaking on fijivillage Straight Talk With Vijay Narayan, Dr Amit Chanan had said many private sector and multi-lateral development partners are willing to help but they are asking that they need to finish the corporatisation process and serious conversations about the tariff.
When asked about the issue of the increasing cost of living situation, Dr Chanan said people pay 15 cents for 1,000 litres of water, which is the cheapest in the Pacific.
He had said that in terms of affordability, there is a scheme already in place where households earning less than $30,000 get free water and they are not saying at all to change that and they want to preserve it in any future arrangements.
If the Members of Parliament are not performing their duties well, there is no point in their salaries getting an increase and this is one area that needs to be monitored.
This was highlighted by Fiji Council of Social Services Executive Director Vani Catanasiga while speaking during the National Workers and Community rally at Thurston Garden in Suva.
Catanasiga says the Deputy Prime Minister and Minister of Finance Professor Biman Prasad, in his budget speech, talked about an independent committee, but there is a need to continue to make sure that CSOs are part of the committee that oversees the performance assessments and decisions around giving the MPs a pay rise.
Catanasiga went on to ask the participants who gathered in numbers today from around Fiji for the rally whether they agree that the CSOs need to participate in the process of how these MPs make their decisions on their own salary, to which everyone present agreed.
She says they have articulated this issue in the petition that they initiated a few weeks ago in regards to the increase in salaries and benefits of MPs, the President and the Speaker.
As departure tax is being progressively increased to pre-pandemic levels of $200, Deputy Prime Minister and Minister for Finance Professor Biman Prasad says the Government has to make sure that they also collect enough revenue.
While responding to questions on whether now is the right time to increase departure tax, Professor Prasad says the tourism industry has rebounded very strongly and that has a positive impact through spending in other sectors.
He says however, we are having a capacity issue within the tourism industry.
He says Deputy Prime Minister and Minister for Tourism is working very hard to bring new investment and Deputy Prime Minister and Minister for Investment, Trade and Industry is also actively working to get new investments in those areas.
Professor Prasad says a number of those investments are already happening and some of them will start pretty soon.
The departure tax will increase from $140 to $170, effective from 1st August 2024 and will return to the pre-pandemic rate of $200 from 1st August 2025.
Dialogue Fiji has welcomed the incremental increases in the minimum wage, which is necessary to lift many working Fijians out of poverty and improve their quality of life and the Government’s efforts to respond to the negative impacts of the high cost of living, and other concerns voiced by various economic stakeholders through the 2024-25 National Budget.
They say the increased allocations for social protection, particularly in light of the high cost of living and widespread poverty, are a step in the right direction towards ensuring that the vulnerable population receive the support they need.
However, they hope there would be political will to reconsider the VAT rate in the next budget to address cost of living issues.
Dialogue Fiji Executive Director Nilesh Lal says the move to raise the minimum wage at staggered rates is a positive development that will gradually enhance the livelihoods of many families, while avoiding the impacts of a large, unsustainable increase, particularly on MSMEs.
He says the allocations aimed at the formalisation of informal settlements are a significant stride towards improving living conditions and providing security of tenure for many Fijians living in precarious situations.
Lal says this initiative is essential for ensuring sustainable development and social inclusion.
He also says they are pleased to note that the budget does not include major austerity measures that could have adversely impacted the pockets of ordinary Fijians and the financial positions of businesses, particularly MSMEs.
He says the announced pay rise for civil servants will inject more money into the economy, however, it is likely to lead to increased demand for pay rises across various sectors.
The Executive Director says this is problematic in light of the potential inflationary pressures that this could exacerbate, given the prevailing situation.
He also says despite the positive aspects, Dialogue Fiji is concerned about the reduction in funding for the Fiji Roads Authority and given the deteriorating road conditions and the rising costs of materials and labour, this decrease is troubling.
Lal says the cut in the FRA's budget means that even with improved efficiency or changes in contracting modalities, less can be achieved in maintaining and upgrading our road infrastructure.
He says this is a setback that could have long-term negative impacts on connectivity and economic activities across the country.
The Executive Director says it is normally expected that if the national budget increases from one fiscal year to another, capital expenditure and those allocated for entities responsible for infrastructure development, should increase proportionally, rather than reduce.
He further says the projected revenue in the budget appear rather optimistic and it is critical for the government to avoid creating further political instability that would affect growth prospects should these projections fall short, the actual deficits would be higher than anticipated.
Lal says there is clearly a need to examine factors which have led to the slowing down of the growth momentum, perhaps through a multi-stakeholder dialogue, and then address these to create conditions to support growth.
He adds otherwise, medium and long term objectives to bring down debt to GDP ratios, etc. will remain elusive and creating the right conditions to realise the GDP growth potential is key.
While the 2024-2025 National Budget is welcome news for the 33,000 civil servants, it still, unfortunately, has not met the expectations of the Fiji Public Service Association that it would steer the economy to recover as well as do social justice to the poor and underprivileged in the country.
This was the statement by FPSA General Secretary, Judith Kotobalavu at the National Workers and Community rally at Thurston Garden in Suva.
Kotobalavu says the consumers had expected the budget to come up with some effective measures to cushion the debilitating effect on the poor and the disadvantaged but sadly this has not happened.
Kotobalavu adds the modest pay increase approved for civil servants will undoubtedly lead to a rise in the cost of living and will have a trickle-down effect all around including in the service sector.
She says the last budget in 2023 which increased the VAT from 9 percent to 15 percent has continued to affect the members and it also had a devastating effect on the poor and the poorest of the poor in the community.
The General Secretary says there is no denying that poverty has continued to spiral upward due to the lack of job opportunities and heavy price rises in consumer goods.
She further says VAT, like all other indirect tax measures, affects the disadvantaged in society more as it raises the prices that consumers pay and poorer consumers use a large part of their income for consumption.
She says the coalition government must seek alternative ways of taxing and growing the economy and should not concentrate on extracting most revenue from the weakest in the society.
Kotobalavu says in totality, the increased prices of goods is affecting the vast majority of the population.
The budget increase is a significant step in the government's commitment to support the sugar industry, ensuring continued growth and prosperity.
This has been highlighted by the Minister for Multi-Ethnic Affairs and Sugar Industry Charan Jeath Singh who says this is the government’s comprehensive plan to support the farmers further and enhance sugarcane production.
While officiating during the 2024 Farmer’s Open Day at the Gujarati grounds in Ba the Minister highlighted that farmers can expect an increase in the Manual Harvesting Support initiative programs, which has seen its funding triple from $1 million to $3 million which will allow for a manual subsidy support increase to $3 per ton, from $1 per ton previously.
He says the Cane Access Road budget has been doubled from $2 million to $4 million in response to challenges faced by the farmers to transport their cane to the mills, and to ensure improved infrastructure support for farmers.
Singh says existing programs, such as the New Farmers & Lease Premium Assistance initiative, will also continue to receive backing from the Ministry.
The sugar industry has been allocated a total of $70.1 million in the 2024/2025 National Budget.
The Government will be looking at starting an investigation into how Health Care Fiji, which runs the Ba and Lautoka Hospitals was formed as legal requirements were not met and FNPF was ordered by the previous Government to take up an 80 percent stake in it.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says FNPF had not bid to be part of the Aspen project for Ba and Lautoka Hospitals.
He says FNPF took 80 percent of its shares with 20 percent for Aspen.
He adds FNPF was given no option, and it was given no chance to evaluate this investment for itself or to work out its economic return.
The Deputy Prime Minister says however, Health Care Fiji has said to the Government that it will work with them to reach a service agreement.
While responding to questions by fijivillage News on whether an investigation will be done on how Health Care Fiji was set up, Professor Prasad says this is something that can be looked at when a renegotiation is being done between FNPF and Aspen.
He says right now, their focus is to move the project ahead with the appropirate negotiations.
Professor Prasad further says unfortunately, the services in the Ba and Lautoka Hospitals are costing about $10 million per month or about $120 million per year.
He says these two hospitals, alone, are consuming more than one-fifth of the entire national health budget.
$4 million is allocated in the 2024/2025 National Budget to a new scheme to provide interest-free loans to support the development of our iTaukei resource owners and investments by provincial holding companies.
Deputy Prime Minister, Professor Biman Prasad says they have provided $4 million which can cater for almost $60 million of interest-free loans.
He says the Fiji Development Bank and Merchant Finance have already partnered with the Government to provide loans with 3 years of interest subsidy paid by the Government.
The Minister for Finance says to support and promote indigenous-owned businesses, they will now accommodate existing Indigenous companies to qualify for tax holidays and duty concessions if they invest in the Tax-Free Regions.
He adds this incentive was previously only provided to new businesses, but they are bringing this flexibility to support our indigenous businesses.
$30.4 million is allocated to the Ministry of iTaukei Affairs in the next budget.
The Fijian Teachers Association says it is not satisfied with the 7 to 20 percent pay increase for civil servants because the government has not committed to considering their demand for a 30 percent pay increase for teachers.
FTA General Secretary, Paula Manumanunitoga says they would have preferred if Professor Biman Prasad had announced a budget plan yesterday that included a 10 percent increase this year, followed by additional increases in the subsequent years.
Manumanunitoga also says that they had a phone discussion with some executives from the Fiji Teachers Union, while they are somewhat satisfied with the 7 to 20 perecent pay increase, they will continue to press their negotiations with the Ministry of Education and the Ministry of Finance to reach a mutual agreement satisfactory to both parties.
He further says for salary band D, which starts at $14,000, teachers have been struggling to justify and cope with their very low pay.
He adds that the cost of living and the pay many teachers are receiving do not meet their daily needs.
9,940 continuing students and 10,830 new students will be assisted by the $150.5 million allocated to the Tertiary Scholarships and Loans Service.
Deputy Prime Minister and Minister for Finance Professor Biman Prasad says as a responsible government, they need to ensure that they are able to reap the benefits of their investment.
Professor Prasad says they are introducing a 50 percent penalty on non-served bond periods and if students do not wish to fully serve the bond period and pay off the remaining bond service on apportioned amount, then a penalty will be applied on the remaining amount.
He says a 50 percent penalty will be applied to the balance of the bond service.
The Deputy Prime Minister says the rationale is in the national interest and to get maximum return of the investment by having the graduates to serve the country.
He says all students have to fully serve their bond, but if they choose to migrate before the completion of the bond, then they will have to pay the remaining balance with a 50 percent penalty before leaving the country.
Prof. Prasad says if students do not have sufficient funds to pay off, the overseas employer should clear full payment and students can make repayment arrangements with them.
The Deputy Prime Minister says effective from 1st August 2024, graduates will not be allowed to make arrangements to do bond repayment from overseas unless determined by FRCS and TSLS on a case-by-case basis.
He says on average, Government spends $400,000 to fund a student on an overseas scholarship and to obtain an equitable return of investment in the bond service, students with overseas scholarship schemes will be bonded 2.5 times of the duration of the study.
He also says the minimum cut off for Degree Programmes will be 250 marks for all other schools and 245 marks for schools which are categorized as rural and maritime.
Professor Prasad says the entry requirement for on-boarding into this scheme will be changed from 65 percent GPA to 50 percent and will be extended to TVET students at Diploma level in addition to the current degree students.
The Tertiary Scholarships and Loans Service (TSLS) Board welcomes the budget announcement and the commitment made by the Coalition Government in empowering Fiji’s Future.
TSLS Board Chair, Ro Teimumu Kepa says as a developing country, Fiji needs to continuously and at a time, aggressively invest in talent development to keep the skills set supply in the workforce.
Ro Teimumu says the TSLS Board and management look forward to working with all key stakeholders at all levels to continue to build Fiji’s human capital.
Professor Prasad says they are introducing a new scheme to fund 20 students to pursue PhD and masters in priority research areas at selected universities in Australia.
He says the tuition cost will be borne by the Australian University while the Government will provide partial support to cover for airfares, stipend and any other associated cost.
He says the government thanks the participating Australian Universities for this great partnership and a sum of $1.4 million is allocated for this.
The Deputy Prime Minister says secondly, they are also introducing a merit based in-service overseas scholarship for postgraduate diploma in specialised areas and a sum of $1.6 million is allocated to fund 20 in-service students to undertake specialist postgraduate diplomas in health, veterinary science and engineering studies.
Prof. Prasad says they have allocated scholarships for 300 students who can undertake Certificate III, IV or Diploma level 5 programmes with our industry partners like Energy Fiji Limited, Marriott Academy, FSC, Telecom and some other large employers that will come on board adding that employers will have the opportunity to employ these students upon successful completion of the programme.
He says the fourth new scheme is a grant based support to assist our graduates to start a business and become job creators, rather than job seekers, and this is where they as a Government need to support the young and creative entrepreneurs.
The Deputy Prime Minister has announced that the Government is allocating $10,000 per student for 30 TSLS sponsored graduates or final semester graduating students to undergo training and start a business with the support from the Fiji Commerce and Employers Federation.
The total government debt is projected to reach $10.9 billion by July 2025 compared to $10.2 billion dollars at the end of July this year.
Based on the figures in the 2024/2025 National Budget, the debt to GDP ratio is expected to be 78 percent at the end of next month and projected to be 77.8 percent by July 2025.
The Ministry of Finance says with a net financing requirement of less than $600 million in the next financial year, deficit financing is not expected to be an issue given the appetite of local financial institutions such as FNPF and the availability of concessional financing from multilateral banks and development partners.
The Gross Domestic Product or the total value of goods and services produced by the country is expected to be $13.17 billion this year and rise to $14.02 billion next year.
The 2024-2025 Budget is set with a total expenditure of $4.552 billion and a total revenue of $3.917 billion.
The fiscal deficit is set at $635.5 million, or 4.5 percent of GDP.
Deputy Prime Minister, Professor Biman Prasad says Fiji Revenue and Customs Service is expected to exceed the $3 billion mark in tax collections for the first time this year.
For the 2024-2025 Budget, tax collections are estimated at $3.3 billion while non-tax revenue collections are budgeted at $618 million.
Meanwhile inward personal remittances increased by 21.3 percent to $1.26 billion, amidst continued emigration in 2023.
The Ministry says the use of mobile money channels has grown quite rapidly over the years and is now the most common channel to transfer funds given the accessibility and lower cost.
Cumulative to March this year, inward personal remittances expanded by 14.3 percent to $310.5 million, driven by higher personal transfers.
Inward remittances are projected to grow by 10.1 percent to $1.39 billion by year end.
For 2025 and 2026, remittances are forecast to rise moderately to $1.43 billion and $1.48 billion, respectively.
Pay increments for civil servants and those in the independent institutions, the increase in salaries and benefits of Members of Parliament, the President and the Speaker, and a new national minimum wage rate of $5 have been announced by Deputy Prime Minister and Minister for Finance, Professor Biman Prasad in the 2024/2025 National Budget.
Professor Prasad says they are announcing a major pay rise for our civil servants, which will inject almost $85 million into the pockets of our around 42,000 public sector employees. This pay rise ranges from 7 percent up to 20 percent depending on the salary bands.
He says unfortunately, the civil service has suffered from years of neglect with stagnant remuneration and deteriorating employment conditions.
Professor Prasad adds the civil service also suffered from lack of investment in adequate training, capacity building and poor succession planning.
He says under the disguise of OMRS, many career civil servants were denied promotions while those without any experience in the civil service were prioritized for senior leadership positions.
Professor Prasad says the 2013 constitutional provisions that removed the central oversight and establishment control of the civil service away from the Public Service Commission to respective Permanent Secretaries led to an uncontrolled growth in the size of the civil service.
He says today we have more than 42,000 publicly funded employees, including around 38,000 in the civil service and almost 4,000 in independent institutions and state funded entities. This comes at a huge cost of around $1.2 billion.
From 1st August 2024, all the salary based civil servants will receive a pay rise of around 7 percent to 10 percent while the wage earners will get an increment ranging from 10 percent up to 20 percent.
For example, the lowest wage in the civil service on Band A will be increased from $4.60 an hour to $5.60 an hour, an increase of 20 percent. Those on Band B receiving $6.27 an hour on step 3, will get a 16 percent increase, with a new hourly rate of $7.27. For our drivers who are currently getting $7.33 per hour on Band C, step 3, they will have their rates increased to $8.33 per hour, an increase of around 14 percent.
For the salary based civil servants, they will do this in a slightly different way. Given that around 5,000 of our civil servants have already had step movements in the last few months, all other 33,000 civil servants will also be given a salary increase and adjustment. For clarity, the increased salary for the 5,000 civil servants who got an early pay rise will continue.
Apart from this, Professor Prasad says they are also accommodating the pay rise of some of our independent institutions that have not had their Job Evaluation Exercise and a salary adjustment since 2017. This includes the Parliament staff, Legal Aid Commission, Office of the Director of Public Prosecutions and the Office of the Auditor-General.
Following a Job Evaluation Exercise recently, they are also providing an additional $12 million to cater for the salary increase for the officers at Fiji Corrections Service and an additional $2 million to hire 81 new staff. Following this major salary adjustment exercise in the civil service, they will work with the Australian Government to undertake a holistic functional review of the civil service establishment and salary structure across public entities.
Professor Prasad says there is an urgent need to bring parity in the salaries of publicly funded employees and right size the establishment.
He says at the same time, they need a new and effective Performance Management System in the civil service.
They are also exploring options for a medical insurance scheme for civil servants.
While confirming the budget for the increase, Professor Prasad says the overall increase in cost for the increase in the salaries and benefits of the Members of Parliament, President and Speaker is $4.2 million, not $8.1 million. He says if adjusted for the 20 percent COVID pay cut, the increase is in fact $1.4 million.
However he says as a Coalition Government, they agree that there must be a qualified and independent emoluments committee in future, a reasonable period for public consultation and careful consideration by MPs of the example they are setting, given their unique ability to vote for their own pay.
He says they believe that future emoluments review of MPs to be determined by an independent emoluments committee to be appointed by a resolution of parliament.
Professor Prasad also reveals that the national minimum wage will be increased to $5 per hour.
The actual implementation will be undertaken in 2 phases. Effective from 1st August 2024, the national minimum wage will be increased to $4.50 an hour with a further increase to $5.00 an hour effective from 1st April 2025.
In tandem, the 10 sectoral wages will also increase. Effective from 1st August 2024, all sectoral wages will increase by 50 cents across the board, followed by a further 50 cents from 1st April 2025.
For example, a cashier who is currently earning $4.44 an hour will have his or her minimum wage increase to $4.94 from 1st August 2024 and to $5.44 from 1st April 2025. A foreman in the construction industry currently on $6.54 will have his or her minimum wage increase to $7.54 from 1st April 2025.
He urges all our employers to ensure that correct minimum wages are paid to their workers and the Ministry of Employment will be closely monitoring to ensure full compliance.
The Coalition Government together with the Fiji Trades Union Congress and Fiji Mine Workers Union, have finally reached a resolution with a total payout of $9.2 million.
Each of the 368 mining workers on strike from 1991 will be paid $25,000, with the first $10,000 paid from this Budget and the remainder of $15,000 paid from the 2025-2026 Budget.
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Prime Minister Sitiveni Rabuka says this is a good budget because the narrative behind the formulation of the budget is satisfying their contributions towards the sustainable development goals of the United Nations.
He says to do that we must allocate the resources according to what needs to be improved towards satisfying the pillars of the goals.
Leader of Opposition, Inia Seruiratu says it’s too early for him to comment on the 2024/2025 National Budget, but he is grateful that there was a lot of assistance provided for the people.
Seruiratu also acknowledged the Government’s move in increasing the pay for civil servants and also continuing with developments.
He says economic security compliments national security, and he will be looking at that in detail during the budget debate.
Fiji Teachers Union General Secretary, Muniappa Goundar says he is not satisfied with the budget as their demands are not met while the Minister for Education Aseri Radrodro says they will continue having discussions and will work in collaboration.
Goundar says the 7 and 10 percent increment for civil service staff is what was told to them during their meeting with the Deputy Prime Minister and Minister for Finance Professor Biman Prasad and that has not changed despite their demand of 30 percent.
He says the union will try to get the best out of what they are demanding.
When questioned by fijivillage News on teachers going on strike after their demands not being met, Radrodro says they are continuing discussions on that to ensure that everybody has a fair share of what is expected in the budget allocation.
He says they are happy that something has been given for their increment.
Fiji Labour Party Leader Mahendra Chaudhry says the National Budget 2024/25 does nothing to meet the expectations of ordinary people for relief from the soaring cost of living.
In a statement, Chaudhry says the Prime Minister gave an assurance that they were listening to the people's cry for relief, and the budget makes it clear that they did not listen at all.
He says it was just plain rhetoric to fool the people.
The FLP Leader adds except for cosmetic changes here and there, the suffering and hardship of the people at large will continue unabated.
Chaudhry says the 15 percent VAT imposed in the last budget remains, and the decision not to levy a dividend tax or rescind the 7-year tax holiday granted to Fiji Water signifies that the Coalition government is all about protecting the interest of the wealthy at the cost of the poor.
He says the increase in the minimum wage from $4 to $5 an hour is totally inadequate as it simply goes up by 50c from 1st August and a further 50c from 1st April 2025.
He further says in 2018, Deputy Prime Minister and Minister for Finance Biman Prasad was agitating for a $5 an hour minimum wage.
Chaudhry asks how Professor Prasad now justifies keeping it at the same rate six years later, despite the enormous jump in living costs brought about largely by his imposition of a 15 percent VAT in the last budget.
He says the social welfare allowance remains the same at $125 a month, and all he has done is add the $25 a month bus fare subsidy to the welfare payment.
Chaudhry says these are the people in the lower rungs of society most affected by high costs of living, and worse still, the eligibility age has increased from 60 to 65 years.
He adds Prof. Prasad’s claims that his government respects the rights of workers and trade unions is yet another rhetoric and rather hypocritical.
The FLP Leader says Prof. Prasad has totally undermined the right of trade unions to collective bargaining by unilaterally imposing pay increases of between 7-20 percent for established civil servants and a $1 an hour increase for those on hourly pay.
Chaudhry says the proposed increases fall far short of the claims of the unions and are not likely to be accepted by them.
He says at the same time, the government has shamelessly gone ahead and endorsed the increase in pay and allowances recommended by the Parliamentary Emoluments Committee.
He adds it has simply ignored the huge public anger at this act of self-interest.
The FLP Leader says they welcome the budget announcement that the government has finally brought closure to the long dispute over the Fiji Mine Workers Union and the FNPF pensioners.
He says more needs to be done here to reimburse Fund members who were forced to withdraw their savings to survive the COVID crisis, which rightly should have been the State’s responsibility.
$259.4 million is allocated to the Water Authority of Fiji in the next budget where it receives about one-tenth of the income it needs to operate and invest sustainably.
Professor Biman Prasad says in the last 10 years, WAF has been dependent on Government grants which are only made known to it every six months and this makes it impossible to plan large expenditure or to borrow money for investment, except through the Government with the support of bilateral funders such as the Asian Development Bank and the European Investment Bank.
He says for water supply boreholes they are embarking on a major project to provide around 1,700 boreholes across the country - 1,000 in Viti Levu, 500 in Vanua Levu and 200 in our maritime islands.
The Deputy Prime Minister says this project will be undertaken in phases and today they are allocating $5.7 million to the Ministry of Lands and Mineral Resources and a task force will be established in partnership with the Ministry of Rural and Maritime Development, Water Authority of Fiji, the Ministry of Public Works and the Ministry of Finance.
He further says $2.7 million is allocated to the Drainage Board to maintain existing drainage systems and enhance water management practices.
Professor Prasad says $16.7 million to the Ministry of Waterways capital budget and $5.5 million to the Ministry of Sugar for drainage works.
He adds for all major rivers and in-land drainage systems, the Government will purchase specialized drainage and heavy-duty dredging equipment to undertake regular works on all inland drains, waterways, and major rivers throughout the year in the Central, Western and Northern Divisions and $1.5 million is provided for this project. Professor Prasad adds they have also allocated $2.8 million for protecting river banks and $1.2 million for managing watersheds.
The Fiji Roads Authority is allocated $354.8 million for the ongoing construction and maintenance of roads, upgrading and replacement of bridges and jetties and the upgrading of rural roads.
He says they are also undertaking a major national study on urban traffic particularly traffic between Nadi and Lautoka, Lami, Suva and Nausori corridor in conjunction with our development partners.
The Deputy Prime Minister says the Ministry has been allocated $5 million for the maintenance and upgrade of rural roads.
The Minister for Finance says the Government has also re-established the Public Works Department with increased funding of $8 million and the PWD will be gradually expanded over the years and will focus on rural roads and public buildings.
The Ministry of Public Works has been allocated with $721.4 million.
Social Welfare budget remains at $200 million which will assist 104,000 people under the family assistance scheme, social pension scheme, care and protection allowance, disability allowance, rural pregnant mother food allowance and transport assistance scheme.
While delivering the 2024-2025 National Budget, Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says they are restructuring the transport assistance scheme for the elderly and people with disabilities.
Professor Prasad says currently, a monthly $25 bus fare allowance is provided to around 48,000 beneficiaries, however many of the elderly and people with disabilities do not have access to buses.
He says to bring greater flexibility and help them they will convert the bus fare allowance into a cash allowance of $25 per month for those with disabilities and the elderly, effective from 1st August 2024.
Deputy Prime Minister says all social pensioners above the age of 70 years and those on disability allowance will now receive a $25 per month cash allowance instead of bus card top-up.
He says pensioners over 70 will now receive a monthly cash allowance of $150, an increase from the current $125 monthly.
The Minister says to help rationalise the transport assistance scheme, they are also going to raise the entitlement age from 60 years to 65 years effective from 1st August 2024 and align it with the eligibility criteria for the social pension scheme.
He says this change will be only applied going forward, which means that those below this age who are already on the assistance system will continue.
Professor Prasad says promoting gender equality and the empowerment for women and girls is a top priority of the Coalition Government.
He says $1 million is provided to assist and empower women institutions, implement the Women's Plan of Action and strengthen the Domestic Violence helpline.
He further says they are working on strategies to increase the female labour force participation rate which currently stands at a low of 39 percent, compared to 77 percent for males.
This includes targeted training, provision of child care services at workplaces and adoption of gender-responsive budgeting.
Deputy Prime Minister adds they are also providing $500,000 for the Women’s Expo which provides an opportunity for our women from around the country to showcase their talents, market their products, generate income and encourage and empower other women in Fiji.
Following the progressive increase in the national minimum wage to $5 per hour, a call is being made to businesses to not pass this increase to consumers just because it is going to raise the cost of production.
While responding to questions by fijivillage News after delivering the 2024-2025 National Budget, Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says it will be unethical for businesses who can afford to pay the increase to pass those increases in cost on to the consumers.
He says the Government is already giving a lot to businesses where the 3 percent duty on the importation of raw materials, machinery, and packaging material that are not manufactured and available locally has been removed and they did not bring back dividend tax and have not increased corporate tax.
Professor Prasad says the Government is open to looking at those employers who may face some difficulty and will assess them.
The Deputy Prime Minister also says raising the minimum wage will also raise productivity and increase economic activity as people will have more money to spend.
Meanwhile the increase in the wages and salaries of civil servants will cost the government an additional $66 million.
Professor Prasad says this money is coming from overall revenue efforts where they are going to collect about $3 billion in revenue by the end of this financial year.
A total of $540 million has been allocated to the Health sector in the 2024/2025 National Budget of which $450 million will go to the Ministry of Health and $90 million for the operations and running of the Ba and Lautoka hospitals under the Public Private Partnership.
This is an increase of over $100 million from the previous Health Budget.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says in a bid to improve service delivery, the Coalition Government in collaboration with the Australian Government have embarked on major technical work to put together a master plan for the redevelopment or relocation of CWM Hospital.
$15 million has been provided by the Australian Government towards this initiative and government is in discussion with multilateral partners like the Asian Development Bank and the World Bank for future funding options.
The Indian Government has also given a grant towards the construction and running of a 100 bed super specialty hospital in Nasinu.
Preparation and construction has started behind the FNU Nasinu Campus.
Professor Prasad also highlights that FNPF had not bid to be part of the Aspen project for Ba and Lautoka hospiatls, as the Fund was effectively ordered by the previous government to take an 80 percent stake in a new company called Health Care Fiji Pte Limited, or HCF.
He says FNPF took 80 percent of its shares with 20 percent for Aspen.
He adds FNPF was given no option, and it was given no chance to evaluate this investment for itself or to work out its economic return.
However Health Care Fiji has said to the government that it will work with them to reach a service agreement.
Professor Prasad says unfortunately, the services in the Ba and Lautoka Hospitals are costing about $10 million per month or about $120 million per year.
He says these two hospitals, alone, are consuming more than one-fifth of the entire national health budget.
Professor Prasad says it is important to remember that the Ministry of Health budget is not just about hospitals - it also has to cover administration, preventive health services, disease control and disaster preparation, health screening and many other things.
$4 million has been allocated to Sri Sathya Sai Sanjeevani Children's Hospital.
Professor Prasad further says that those under the social welfare schemes, free medicine scheme and receiving kidney dialysis subsidy get an automatic access without any further assessment or income verification.
He says they need to present their welfare or free medicine card at the participating general practitioners services.
Professor Prasad says they have paid $19 million to extend these services and in the budget and they are estimating an additional cost of $5 million to assist those on kidney dialysis, they have allocated $3 million for the continuation of the $180 per session subsidy for dialysis patients, which was increased from $150 to $180 int the last budget.
He says for the procurement of drugs and medical equipment, around $96 million is provided in the 2024-2025 Budget.
He says for procurement of bio-medical equipment, $15 million is provided and for capital construction and maintenance works, they are providing $12 million for the interior works at the Labasa Hospital, refurbishment and upgrade of our urban and sub-divisional hospitals, health centres and nursing stations, refurbishment of Savusavu health facility and the construction of a new rehabilitation centre in Tamavua.
| 2024-2025 Budget Address | 2024-2025 Budget Supplement | 2024-2025 Budget Estimates |
Great news for members of the Fiji National Provident Fund as FNPF has achieved a record interest rate crediting of 8 percent for members, the highest in the last two decades.
A total of $561.5 million will be paid to 417,722 members’ accounts tomorrow.
FNPF Chief Executive Officer Viliame Vodonaivalu says this remarkable achievement is a testament to the effectiveness of their investment strategies, which have been meticulously crafted to optimize returns, diversify their portfolio, and focus on resilient sectors for sustainable growth.
Vodonaivalu says they will continue to uphold their values of integrity, transparency, and accountability in serving the members and the people of Fiji.
He says the increase in income, has been driven by several key contributors.
Vodonaivalu says government bonds have been a significant source of total income earned, accounting for 30 percent of the total.
Equities have also performed well, contributing 51 percent, commercial debt 11 percent and property and other portfolio 8 percent.
He says these results align with their core strategies of optimizing existing investments, diversifying across various asset classes, and focusing on resilient sectors for sustainable returns.
Of the income earned from equities and commercial debt, their telco assets generated 9 percent and hotel assets accounts for 24 percent.
The FNPF CEO says a few of their recent investments are a testament to their forward looking strategy, for example, the acquisition of shares in Future Farms – Rooster Chicken and Fletcher Higgins of Fletcher Construction and the mix-use commercial/industrial property assets.
He adds that with a continued member centric focus, the Fund has made great strides through the enablement of beneficial initiatives such as the inclusion of professional development courses and laptops in the education withdrawals, positive changes in medical and unemployment preretirement benefits and collaboration with institutions such as the I-Taukei Land Trust Board for housing withdrawals.
Members will be able to view their new balance on the myFNPF App and other digital platforms, from Monday 1st July.
FNPF’s digital platforms will be offline on Sunday 30th June from 8am to 7pm.
$4 million will be provided in the 2024-2025 National Budget to reinstate the Fiji National Provident Fund pension payments for pensioners that were forced to opt for a reduced pension rate following the 2011 pension reforms by the Bainimarama interim government.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says the pension payment will be restored from 1st August 2024 and moving forward.
This only applies to those pensioners that opted for full pension after the reforms and excludes those that fully or partially withdrew their funds.
The full actuarial cost of this reinstatement for around 1,500 pensioners is $57.0 million over the next two decades.
The earlier arrangement for the affected pensioners to access the Government social pension scheme will cease effective 1st August 2024.
Families with household income of less than $50,000 will have the $200 back to school support for children again next year.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says this $200 back to school assistance per child has become one of the flagship initiatives of the Coalition Government.
$40 million has been allocated for this initiative.
Tertiary institutions are getting $91 million in the 2024/2025 National Budget.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad stated this in parliament saying as soon as they came into Government, they restored the grant for USP, including their commitment to pay to USP what it was owed after its destructive fight with the previous government.
Professor Prasad says it is important to show that the Government can be trusted to meet its commitments.
He says they immediately identified funding and paid $10 million followed by another $20 million in the last Budget while a further $5 million is allocated for the payment of the outstanding grant.
The Deputy Prime Minister says apart from this, $33.5 million is provided to USP as its normal grant for this year.
He says the Fiji National University will be provided a funding grant of $36.5 million.
Prof. Prasad says the Ministry of Education has commenced the reviews of the tertiary education institutions which includes FNU, and the review will also focus on putting a focus on quality.
He says the University of Fiji is provided an increased grant of $5 million, of which $1 million is for the construction of Center for i-Taukei Studies to support preservation and promotion of indigenous Fijian art and culture through teaching, research and publication.
The Deputy Prime Minister says they have supported Pacific Polytech in the last 2 years and they have created a major impact in the provision of technical training in Fiji to meet the current shortage in the labour market.
He says this institution caters for many of our young people who fall through the cracks in terms of completing their education, or qualifying for a trade – the majority of them are iTaukei students and the government must address this to provide a second chance at a more meaningful future.
Prof. Prasad says since its inception in August 2023, more than 1,100 students have completed various national qualifications under the Fiji National Qualification Framework.
He says to support this further given the exodus of many of our workers, the government is providing an increased grant of $5 million to Pacific Polytech.
The Deputy Prime Minister says the Sangam Institute of Technology is provided a budget of $545,000 for its operations, while an additional $1 million is provided for its capital works to expand its infrastructure in Labasa and start establishment of a new nursing school facility in Nadi.
He says they will fund this over two fiscal years as the work progresses.
Prof. Prasad says a total of $2.2 million is also provided to Corpus Christi, Fulton College, Montfort Technical Institute, Monfort Boys Town, and Vivekananda Technical Centre and two new institutions: Caregivers Training Institute and ServicePro International Tourism Hospitality Institute.
To provide affordable housing to thousands of people in Fiji who do not have their own house, a total of $32.3 million has been allocated to the Ministry of Housing in the 2024/2025 National Budget.
While announcing the budget, Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says as a country there is a serious lag in meeting the increased demand for housing in urban areas.
Professor Prasad says there has been progress in additional housing supply for the middle and high income earners and they haven't had any major breakthrough in providing affordable housing to the low income households.
He says this led to the increase in informal settlements across our urban areas.
The Deputy Prime Minister says to increase the supply of affordable housing units, government had called for a tender for the private sector to develop and build around 3,000 housing units in 5 Housing Authority sites, including Nepani, Raiwaqa, Davuilevu, Wainibuku and Tavakubu.
Professor Prasad says this is a public private sector partnership project that has been designed with the support of International Finance Cooperation, the private sector arm of the World Bank.
He says they are currently assessing the tender bids and a final decision will be made soon. He further says $13.5 million is provided for the formalization of informal settlements, this will cater for ongoing projects in Sakoca, Tavela, Field 4, Tore and commencement of work in Valewaquyaya in Ba and Vunika in Labasa.
Professor Prasad adds to continue with the first home buyers grants, a budget of $5.5 million is provided and a total of $7.9 million is provided for capital grants which will cater for development of the Veikoba bridge to support Housing Authority’s residential lot development in Valelevu, subsidy for Public Rental Board, expansion of the Koroipita model town development and grant to Habitat for Humanity.
$778 million has been provided towards education and skills development, the largest allocation in the 2024/2025 National Budget.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad stated this during the 2024/2025 Budget Address today saying it's not just about the dollars that they put in, it’s about the outcomes.
Prof. Prasad says they need to improve the quality of teaching and learning in schools by ensuring that they have the best teachers, the right learning environment, the right curriculum, textbooks and other resources.
He says we need the involvement of our parents, communities, religious groups, development partners and other non-governmental organizations.
The Deputy Prime Minister says unfortunately, this partnership was destroyed by the previous Government’s bullying, dictatorial and micro-managing behaviour which seriously damaged decades-long partnerships built on trust which are the backbone of our education system.
He says we need to bring back these partnerships and inclusivity in the running of our schools if we are to make real progress in improving the quality of education in Fiji.
Prof. Prasad says given the state of affairs in the education sector, they cannot repeat the mistakes of the previous Government by bringing in haphazard changes and reforms without proper consultation and expert guidance.
He says that is why they initiated the National Education Summit last year and brought together our educationists and the best minds to assist.
The Deputy Prime Minister says they are also appointing an Education Commission, made up of experts to help the Government with an independent assessment of the current situation and the interventions that will be needed, including the timing and sequencing of these reforms.
He says in the current budget the Coalition Government has taken decisive measures towards reshaping the Education Sector.
Prof. Prasad says they are increasing the funding for the Ministry of Education to around $628 million.
To fight drugs, $2 million has been allocated in the 2024/2025 National Budget to establish a Narcotics Bureau within the Ministry of Home Affairs.
Minister for Finance, Professor Biman Prasad says the Narcotics Bureau will focus on law enforcement; investigations; prosecution; intelligence gathering; and conducting awareness in collaboration with key agencies.
Professor Prasad says the Ministry of Home Affairs has also launched the Counter Narcotics Strategy 2023-2028 with a focus on seven strategic areas, including demand reduction, supply reduction, harm reduction, legal reform, data collection, establishment of a Drug Court, and partnership and international cooperation.
For the set up of drug rehabilitation centres in Fiji, the government has introduced a tax holiday of 13 years, including duty free importation of capital goods required for the establishment of the centre.
They are also going to provide a full tax deduction for businesses that donate to any drug rehabilitation centre. Professor Prasad says whilst they encourage non-governmental organisations, the government is also exploring options for the setup of such centres.
$226.8 million is provided to our Police Force, an increase of $41.7 million.
He says the government is initiating a ‘full reset’ of the Fiji Police Force towards law enforcement.
The Police Reset Strategy would broadly include: development of a new overarching strategy for the Fiji Police Force aimed to modernize the Force through right-sizing and stirring a shift in culture.
Professor Prasad says they are grateful for the support from the Australian Government to help build capacity.
A new MOU will be established between the Fiji Police Force and the Australian Federal Police which will see Australian Federal Police Officers embedded within the Fiji Police Force, and appointment of a mentor to support the new Police Commissioner.
He says through this Police Reset Strategy, the coalition government is committed towards building a police force that serves and protects all members of the society with efficiency, fairness, reasonableness, courtesy, respect and without discrimination or harassment.
Meanwhile Professor Prasad says the Republic of Fiji Military Forces plays an important role in ensuring the safety and security of our nation and supports international peacekeeping.
RFMF is allocated $169.6 million in the new budget.
Get ready to pay more for alcohol and cigarettes as excise taxes on these items will increase by 5 percent.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad says from 1st August 2024, the departure tax will increase from $140 to $170, and return to the pre-pandemic rate of $200 from 1st August 2025.
The 3 percent duty on the importation of raw materials in the last Budget has been removed.
To support construction and bring down building costs, the fiscal duty on prefabricated buildings will reduce from 32 percent to 5 percent while fiscal duty on steel structures or articles of iron will be maintained at 5 percent.
For our hotel incentives, we are extending the SLIP tax holiday to investors who acquire existing hotels and undertake renovations and refurbishments of more than $50 million. This will support major investments like Crowne Plaza and Wananavu resort. At a time when we need more capacity in the tourism sector, we encourage investors to take advantage of this.
In addition, the standard allowance for renovations and extension of hotels will be reduced from 50 percent to 25 percent, similar to pre-COVID levels.
The water resource tax rate will increase from 1 cent per litre to 5 cents per litre, for producers who extract between 0 to less than 10 million litres per month. The rate for producers extracting over 10 million litres per month remains unchanged at 19.5 cents per litre which was increased from 18 cents per litre in the last Budget.
A 200 percent deduction will be allowable for donations over $10,000 towards the 2031 Pacific Games. Similar to the tax incentive provided to Fijian Drua, a 13-year tax holiday, duty concessions on imported sports equipment and 200 percent tax deduction will be extended to Fiji National Rugby League.
The 2024-2025 Budget is set with a total expenditure of $4.552 billion and a total revenue of $3.917 billion.
The fiscal deficit is set at $635.5 million, or 4.5 percent of GDP.
Professor Prasad says the debt to GDP ratio is projected to decline further to around 77.8 percent by the end of July 2025.
He says the FRCS is expected to exceed the $3 billion dollar mark in tax collections for the first time this year.
For the 2024-2025 Budget, tax collections are estimated at $3.3 billion while non-tax revenue collections are budgeted at $618 million.
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