Prof Prasad Gets into the Nitty Gritty of Finding Funds to Implement Election Promises
Professor Biman Prasad faces the most onerous task in the new coalition Government. If you have not seen much of the Minister of Finance around except for the ministry’s welcome ceremony and the combined church service on Sunday, he has been busy. He has probably got his head down, crunching figures with senior ministry staff, on how they will finance the carrying out of election promises.
Some of the decisions can be made right away but for others like big expenditure items, they need to go to Parliament for approval.
Prof Prasad had earlier said there
would be no mini Budget which The People’s Alliance had mentioned in its manifesto.
The Government would ride out the remaining six months of the FijiFirst Government National Budget 2022-2023.
It is not an easy exercise to produce a National Budget. It would still require consultation with stakeholders even though the Government has a definite goal.
Take for example, the promise for free tuition for tertiary students
and the wiping out of student loan debt.
This is expected to run into millions of dollars. It could cost much more than what the previous Government budgeted for.
Professor Prasad’s challenge is to find the funds from the Government revenue through taxes or other sources through grants from our overseas development partners or loans from commercial lending agencies here and abroad.
All the three coalition members have been critical of the Government’s debt level and obviously there would be moves to reduce it. It only puts pressure on the new Government and to make good its promises. Prof Prasad could cut the expenditure in some areas and direct the savings to pay for free education up to tertiary.
Some are saying that the plan to bring back the Public Works Department and phase out the Fiji Roads Authority would save millions of dollars and provide much needed employment.
So in preparation for the change, the Government could siphon some of the Infrastructure budget to go towards the financing of the free tuition and the forgiving of student loan debt.
The other challenge for Professor Prasad is to ensure that it is sustainable in years to come.
Some countries like New Zealand had tried a similar scheme but stopped it because they could not afford to sustain it due to burgeoning costs.
It may be a bit unrealistic to implement the free tuition and the wiping out of student loan debt before the first semester starts. Even the Ministry of Multi Ethnjc Affairs is not ready to roll with the multi-ethnic scholarships. So students may find themselves carrying on with the status quo until something concrete is decided. If it requires a law change then it needs to go to Parliament. Up until yesterday, there was no word on the date of the next Parliament session. We can expect a number of bills and motions to be tabled by the new Government to kickstart its implementation of its election promises.
We will get to know more after Cabinet meets on January 17.