Health, education, social welfare and government salaries receive boost in budget

In the government’s new $12.5 million deficit budget, health and education will receive the highest boost for the new financial year as well as boost to the social welfare budget. As announced by the Minister of Finance, last week the largest expenditure of the government is to cover the salaries of its workforce and the cost of social services. In the new budget which starts on the 1^st of July, the departments of health and education and the public service commission will receive the highest boost in budget.

The Health department will receive the highest increase in this budget with $887,915 a 26 percent increase. Justice, Lands Surveys and Community affairs which controls the social welfare budget is increased by $859,265 – an increase of 12 percent. Education’s budget is boosted by an additional half a million dollars with an increase of $516,221 – 11 percent increase.

The Public Service commission will receive a 30 percent increase to its budget with an additional $749,000 increase. The Department of the Prime Minister and Cabinet will also receive a 21 percent increase or $348,406. The Niue Assembly will also receive an increase of 15 percent or an additional $200 thousand to its budget. The budgets for Niue Power, Civil and Quarry and the Department of Transport also received a boost of over $200 thousand to their budgets.

The only department with a large decrease in budget is Bulk Fuel, the bulk fuel budget is reduced by 5.8 million compared to last year. Bulk fuel spent over 10 million in this current financial year.

Meanwhile, the Niue Assembly’s Public Accounts Committee identified in its report to the parliament system-wide challenges affecting the effective use of public resources, including:

• misalignment between appropriations and actual cash availability,

• inconsistent planning and project justification, and

• underutilised or ageing government assets and infrastructure.

According to the committees report, several recurring themes emerged from the consultations with departments, these include;

• Staff shortages remain a persistent challenge, with multiple departments reporting difficulty in recruiting and retaining skilled personnel to deliver essential services.

• Cash flow constraints were commonly cited as impediments to timely implementation of planned activities, even where appropriations had been approved.

• Asset management and maintenance—including the procurement, upkeep, and utilisation of machinery and equipment—was identified as a key operational risk.

• Uncoordinated in-year spending plans proved challenging and limiting Treasury’s ability to effectively manage liquidity and prioritise funding.

Next week, we will continue with our budget 2025/2026 series and discuss the recommendations from the Public Accounts committee for each government agency.