A number of targeted initiatives and measures announced in 2015 National Budget

The 2015 National Budget has a number of targeted initiatives and measures to ensure that the people get targeted assistance and government services through the civil service are enhanced.

Many key revenue and expenditure measures have been announced for next year.

As expected, a major focus has been placed on education, water, health, roads, infrastructure, social welfare, agriculture and rural development.

Finance Minister Aiyaz Sayed-Khaiyum said the country had an economic growth rate of 4.6% last year.

The growth rate is expected to be 4.2% this year and 4% next year.

Total revenue for next year is expected to be 3.1 billion dollars while government expenditure is expected to be 3.3 billion dollars.

41% of next year’s budget will be capital expenditure.

Looking at the changes in taxes and duties:

To fight Non-Communicable Diseases, Excise Duty on tobacco and alcohol will be increased by 10 percent while there will a 5 cents per litre excise duty imposed on sweetened drinks.

Prices of items like perfume, cosmetics, pre-shave, shaving gear, after shave, cameras, camcorders, sunglasses, binoculars, video and electronic games, watches, ipods, MP3 and MP4 players and jewelry will go up.

Duty for all items will increase from 0% to 32%.

A new import duty of 32% will be introduced on photocopy paper.

To protect the local industry, Import Duty will now be charged on imported exercise books.

This will be a specific rate of $1 or 32% whichever is greater.

Duty will be increased on blank CD’s and DVD’s from $2 to $5.

The Service Turnover Tax is also extended in the 2015 National Budget.

The Service Tax will be charged on the provision of meals, beverages or any other services in all licensed bars including bars located in clubs. The tax will also be extended to include service provided by hired vehicles.

The scope of the Service Turnover Tax will also be extended to include takeaway meals in restaurants with a gross turnover of $1.5 million dollars.

It has also been confirmed that the VAT Decree will be amended to zero-rate repeats of prescribed medicine.

The value of Fringe Benefit Tax from motor vehicle is reduced by 50% and the remaining 50% will be charged the tax.

The Fringe Benefit Tax will also be extended to include all accommodation provided to hotel executive managers, irrespective of the location of the hotel.

There is also good news for workers as FNPF Employer contributions will increase from 8% to 10% from January next year.

This means an increase in employees’ retirement savings.

A major initiative has been announced in relation to land to ensure that non Fiji residents can only lease i-Taukei land for residential purposes or only purchase strata title properties.

A strata title is a form of ownership devised for multi-level apartment blocks.

Non-residents will no longer be able to buy freehold land or leasing state land for residential purposes.

Instead they can only lease i-Taukei land which will increase the value of i-Taukei land which will benefit the i-Taukei landowners.

The minimum agricultural capital investment required to qualify for a 10 year tax free holiday is reduced from $2 million to $250,000.

There is also an amnesty of 6 months for those who cannot pay their tax liability.

They need to come back to FRCA with a payment program within 6 months. This applies to those individuals and companies who have accepted their tax liability and are willing to pay.

A 6 months amnesty has also been granted to people to make accurate declarations of assets outside Fiji.

Looking at the targeted assistance and government’s focus on the delivery of services to the people:

Education:

142 new additional primary school teachers will be recruited next year while there will be 206 new additional secondary school teachers.

This is to improve the student to teacher ratio in the schools.

The free school program will be extended to accredited preschools from the second term of next year.

This is only for students who are one year away from attending primary schools.

Free 250ml of milk will be provided to all Year 1 students daily.

$3.6 million has been allocated for this initiative.

Education has received a record budget of $556 million in 2015.

Finance Minister Aiyaz Sayed-Khaiyum said enrolment in schools has increased by 3 percent and daily attendance has also increased this after the fee free education initiative which started this year.

Free bus fare and other forms of subsidies for students will also continue next year.

Aiyaz Sayed-Khaiyum said the government will look at increased funding to the disadvantaged and rural schools and also look at school construction and upgrades.

A new secondary school will be constructed in Ono-i-Lau and Sigatoka Methodist College will be relocated to Kulukulu.

The government will also set up three fully fledged technical colleges, one in the Suva Nausori corridor, one in Nadi and one in Labasa.

$7 million has been allocated for the setting up of the technical colleges.

A total of 10 technical colleges are expected to be set up in the country.

The Tertiary Loan Scheme will continue next year and a total amount of $52.5 million has been allocated for that initiative.

There is also an increased allocation of $12 million for those attending the technical colleges and wanting to get tertiary loans. 

For tertiary institutions, USP has been allocated grant of $36.6 million next year, FNU $38.6 million, $4 million Capital Grant allocated for the new Labasa FNU campus, while University of Fiji will get $2.5 million.

The one laptop child per program will now be called the one learning device per child program and it has been allocated a total amount of $800,000 for 2015.

The Ministry of Education budget has a $30 million increase in their budget for next year.

Health:

The Health Budget increased to $269.7 million, this is an increase of $47.3 million.

All necessary prescribed medicine under price control will be provided free of charge to Fijians earning $20,000 or less from next year.

This will also include medicines for non-communicable diseases.

$8 million has been allocated for this initiative.

150 new doctors and 200 new nurses will also be employed in the health sector in 2015.

The government has also provided $2.7 million to hire 91 new additional health care workers such as pharmacists and lab technicians.

$17.5 million has been allocated for the construction of the new 55 bed Ba hospital, $4 million is provided for the construction of the new Nausori hospital and another $5.5 million is allocated for the ten bed low risk maternity unit in Makoi.

The relocation of the Naulu Health center will be undertaken at the cost of $850,000 while $200,000 will be allocated for site works for the upgrading of the Valelevu Health Center.

The Government is also providing $6.5 million in 2015 to overhaul the Lautoka hospital accident and emergency department and to make it more modern, efficient and patient friendly.

$2.2 million dollars is budgeted to upgrade the Keiyasi Health center and a further $2.4 million is provided for the upgrade and extension of the Rotuma hospital.

The government will also continue with the extension of the CWM hospital Maternity unit and has provided $3 million for civil works next year.

This project involves the construction of a new 224 bed unit which will cater for the demand for maternity services in Suva.

The Government is also undertaking a large investment to establish a world class tertiary hospital in Lautoka.

This will be running in collaboration with the medical college of the Fiji National University.

When it is completed, it will provide advanced medical and surgical services.

Medical services in the tertiary hospital will be provided free of charge to those households with incomes less than $20,000 and to all retirees irrespective of whether they are on pension or not.

Water:

There is a $99 million increase to the Water Authority budget to fix the water supply systems around the country.

A record budget of $239 million has been allocated to the Water Authority.

As stated in the FijiFirst manifesto, the government will provide 91,250 litres of water free of charge per year from 2015 to Fijian households earning less than a total annual income of $30,000.

Electricity:

The government also delivers on its promise by increasing the electricity subsidy for low-income families from the current 75 kilowatts to 85 kilowatts.

This will provide immediate relief to thousands of households.

Sayed-Khaiyum said they are also committed to improve access to electricity to those who are currently unconnected.

He said the government is increasing the budget provision for rural electrification projects to $19.5 million to cater for the extension of electricity supply, solar system installations and house wiring.

Fuel:

The Government has also confirmed that it will call for international tenders for the supply of fuel which will enable the government to negotiate lower prices and pass savings to consumers when local oil companies procure fuel from government

Roads:

A record capital grant of $635.6 million has been allocated to the Fiji Roads Authority for the development and upgrading of roads around the country.

Sayed-Khaiyum also confirms that the Stinson Parade and Vatuwaqa bridge replacements will be funded through a $15 million grant from China.

Funds have also been allocated for the Nadi to Lautoka 4 lane project. New street lights will also be put up near villages and shops.  

Other key areas in the budget:

Tourism Fiji will receive $23.5 million to market Fiji next year.

$12 million has been set aside for the Fiji International Golf tournament next year.

$10 million has been set aside to assist first home buyers who earn $50,000 or less while $530,000 is allocated for the upgrade of city wide squatter areas.

Funds have also been allocated for the new town development in Seaqaqa next year.

A new Nasinu marketplace in Laqere will also be constructed in 2015.

The Finance Minister said $30.1 million is also allocated in 2015 to purchase a new vessel to service the maritime areas while a new District Administration Office will be constructed in Koro Island.

The USD$70 million line of credit from India announced for Co-generation project at the Rarawai Mill while $600,000 is allocated to purchase cane cultivators to assist cane farmers.

Agricultural scholarships will also continue at the Fiji National University while Sayed-Khaiyum said $500,000 has been allocated for dairy development next year.

Financial assistance has also been announced for Christmas Island veterans who were exposed to dangerous radiation.

A new weather office will be set up in Labasa.

$200,000 has been allocated for this.

FICAC has been allocated $8.96 million.

$2.5 million has been allocated for the Land Bank initiative while $350,000 is allocated for the extension of the Fiji Museum.

It has also been confirmed that $10 million has been allocated for the improvement of Albert Park and the modernisation of the facilities at the park.

Disciplined forces:

The Fiji Police Force Budget has a total budget of $120 million which is an increase of $8 million.

The RFMF will get $103.3 million.

This budget includes the construction of the new training centre at Blackrock in Nadi and the upgrading of the Sukanaivalu Barracks.

$72.6 million has also been allocated for overseas peacekeeping missions.

The Fiji Corrections Services will have an increased budget of $38 million.

100 new positions for prison wardens will also be created next year.

Reform of the civil service:

A major overhaul of the public service in 2015 is expected through the assistance of Fiji’s development partners.

Consultants from the World Bank are expected to move into the civil service to evaluate the public service structure.

The Finance Minister said leadership of the civil service needs to be improved and many departments need to be restructured.

Sayed-Khaiyum said government should be able to recruit, train and retain the best people in the civil service.

Reform procedures will also include the procurement of goods to ensure that they do not just go for the cheapest goods but the best products that will deliver the best service.

Reactions:

Finance Minister and Attorney General Aiyaz Sayed-Khaiyum said sale of government assets shares will begin next year and they intend to earn about $507.3 million.

Sayed-Khaiyum said they are looking at a public private partnership by divesting shares in Airports Fiji Limited, Fiji Electricity Authority, Fiji Ports Corporation Limited and Government Printing.

He added talks will begin soon on how government will sell these assets.

There is good news for those people who are currently earning two dollars per hour or less as from next year the National Minimum Wage Rate will increase to $2.32 per hour.

An extensive market research has revealed that people can afford to pay this wages.

This has been increased from $2 per hour which was set last year.

There is also good news for police officers as they will receive their back pay next year.

Sayed-Khaiyum said police officers have been granted this back pay after a Job Evaluation Exercise was conducted a few years back with the Fiji Correctional Services, the Republic of Fiji Military Forces and Police.

He also said when the Fiji Police Force had their pay increase last year, a percentage of that increase was not reflected in their allowances.

Sayed-Khaiyum said $2.4 million has been allocated for this payment.

Opposition Whip, Ratu Isoa Tikoca said that the 15 members of the Opposition did not vote after the first reading of the budget when a motion was called for the consequential bills because they believe that the parliament session was disorganised.

Tikoca said they oppose consequential bills to be brought in with the appropriation bill on National Budget Day although the consequential bills like amendments to the VAT Decree and the Income Tax Act would need amendments through a bill.

He refused to comment on whether the opposition accepts the 2015 National Budget.

However Opposition Leader and Shadow Minister for Education Ro Teimumu Kepa have welcomed most of the education reforms that the government has outlined in the 2015 National Budget.

Ro Teimumu also showed her support for the government’s initiative to extend free education to the pre-school level.

National Federation Party Leader in parliament, Biman Prasad has called the 2015 National Budget as a show of boring economics.

Minister for Education, Mahendra Reddy said they are excited about the reforms that have been announced to bring back quality education that people want.

Health and Medical Services Minister, Jone Usamate said there will be a significant expansion in the number of doctors, nurses and allied workers which will improve their service delivery at hospitals and health centers.

Minister for Infrastructure and Transport Pio Tikoduadua said a lot of the money allocated for roads is going into backlogs, primarily bridges and jetties.

Minister for Women, Children and Poverty Alleviation Rosy Sofia Akbar said 2,000 children are currently under their care and protection program and with the increased funding they are looking at an increased number of children that will be targeted.

Akbar added that on the other hand there are more than 17,000 families benefitting from the poverty benefit scheme which includes cash and food vouchers.

Minister of National Security and Defence Timoci Natuva has acknowledged another increase in the Fiji Police Budget.

Natuva said the Ministry wants the Police Force to be well equipped.

The Government has come through with its elections promises and has addressed the issue of stability in policies as requested.

Fiji Commerce and Employers Federation Chief Executive Officer Nesbitt Hazelman said the Federation is happy with next year’s budget allocation.

The Group Chief Executive Officer of FMF Foods Limited, Ram Bajekal said they are happy not to hear anything shocking or surprising in next year’s National budget.

Minister for Tourism, Faiyaz Koya said the major part of the tourism budget is taken up by marketing.

Minister for Agriculture, Inia Seruiratu said that one of the key areas is to replace the older farmers with the younger generation. He said that is why the Government is again encouraging the young farmers to take advantage of Fiji’s vast agricultural potential.

The scholarship program has been allocated $500,000 for next year.

The Consumer Council of Fiji Chief Executive Officer, Premila Kumar said they are glad that there will be a review in the Ministry of Health.

You can check out the 2015 National Budget updates and photos on our website, fijivillage.com and on our facebook account, fijivillage.com.