BY NED GAGAHE
Prime Minister Jeremiah Manele has mounted a strong defence of the 2026 Appropriation Bill, rejecting opposition arguments that the government is driving the country toward fiscal danger, and insisting the budget is both credible and grounded in sound economic analysis.
Speaking in Parliament during the second reading of the bill yesterday, the Prime Minister said critics were “bordering on misinforming” the public by portraying the 2026 budget as risky, despite clear evidence the government is strengthening its fiscal position.
He said the deficit would fall sharply next year—from this year’s $1.1 billion (7.5% of GDP) to $548 million (3.5% of GDP)—a deliberate move under GNUT’s medium-term strategy.
“Contrary to the views advanced by some colleagues from the other side, the budget before us is credible,” the Prime Minister stressed. “It is based on sound analysis of both domestic and international contexts.”
Manele dismissed claims that rising debt would burden the country, pointing instead to strict borrowing controls under the Public Finance Management Act (PFMA).
He highlighted that all 2026 borrowing will be for development and infrastructure, not for covering recurrent spending, saying domestic revenue is projected to exceed recurrent expenditure by $96 million next year.
“This clearly shows our recurrent budget is fully supported by domestic revenue, reducing exposure to cash flow pressures,” he said.
The Prime Minister also pointed to the latest IMF Debt Sustainability Analysis, which shows the overall risk of debt distress remains moderate, while the risk of external debt has improved to low—a significant upgrade from last year.
“We are not reckless. We have been diligent right through the preparation of this budget,” he said.
Manele criticised what he described as political rhetoric over inflation, saying opponents were misleading the public by claiming projected inflation of 3.5%–4% in 2026 would make life harder.
“From 2022 to 2024, inflation hovered between 5% to 6%,” he said. “This government is working earnestly to make life easier for our people by bringing it down.”
The Prime Minister said the budget’s agriculture investments, particularly in export-oriented programmes and food security, were designed to support farmers, reduce rice imports and strengthen household purchasing power.
He highlighted nearly US$30 million worth of agriculture and food security support being channelled through IFAD, FAO, UNICEF and Japan.
Manele concluded by calling the budget a disciplined and credible plan that balances ambition with affordability. He urged the House to support the bill and allow government to continue steering the country toward economic stability and growth.
The 2026 Appropriation Bill seeks to authorise $5.6 billion in spending for the coming financial year.
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