Brave and bold budget delivered during an extremely difficult period - Nilesh Lal

The Executive Director of Dialogue Fiji Nilesh Lal is calling on all Fijians to play their part and get vaccinated to ensure the Government actually has the capacity to execute the 2021/2022 National Budget.

He says the budget is a brave and bold budget delivered during an extremely difficult period for the national economy, which is aimed at creating incentives and providing targeted relief and assistance to individuals and businesses affected by the ongoing pandemic.

Lal says the budget is commendable because it was developed in extremely challenging and uncertain times.

He says when evaluating the stimulus policies, it is important to see whether it will be able to boost spending quickly, achieve a large increase in spending in the short-term with minimal impact on the people.

He adds the $200 million unemployment benefit and the additional $200 million soft loan facility for businesses will boost spending immediately and this is needed in the short term.

However, he further says its impact may quickly evaporate once the Government withdraws its support.

The Executive Director says the announcement of other initiatives, and the continuing of those from the last budget, are also expected to contribute to economic recovery now, but may not be sustainable in the long term.

He says they have noted that the Government's ability to implement a $3.69 billion budget depends on its capacity to raise revenue at appropriate levels.

Lal says there is considerable doubts amongst commentators on whether the Government would be able to generate the projected revenue of $2.085 billion in the new budget given the prevailing economic circumstances.

He says this, however, provides optimism in the fact that the Government was actually able to collect more revenue in the last fiscal year than was projected despite the subdued economic activity in the last quarter due to the second COVID-19 outbreak.

Lal adds that they also noted that the Ministry of Economy is basing its projections on the assumption that herd immunity will be achieved once 80% vaccination coverage is achieved.

He says this is a flawed assumption that is not informed by the prevailing scientific opinion and any estimates which are based on this assumption will likely not hold true whether these may be allocations for health care delivery or projections of revenue from international travel and tourism.

He further says this requires the concerted effort of every Fijian, like never before as economic recovery is incumbent on our ability to contain the current outbreak in the shortest possible time.

Lal says an extra day of the outbreak does additional damage to the economy and compromises the future of our children.

He adds this is why everyone needs to get vaccinated at the earliest and practice COVID-safe measures to contain the spread of the virus.

He says vaccination is the only way to contain the outbreak, given its widespread prevalence in the community.

Lal says the next few months will require every Fijian to do their part in ending this outbreak so that economic activity can return to its former levels or otherwise, painful budget cuts and other strict measures will become unavoidable.

The Executive Director of Dialogue Fiji says the state does not have limitless capacity to drive the economy and overall, the budget has endeavoured to cater for the needs of various sectors of the economy.

He also stated that it is pleasing that the submissions of different stakeholders have been reflected in the budget allocations.