The Cook Islands Government has now released the budget for 2014/15 with a small underlying surplus of $0.009 million. Underlying operational revenue is estimated to reach $123.203 million in 2014/15 and expenditure is projected to be $123.195 million. Major new initiatives include:
- An increase in the pension to those aged 70 years and over of $15 from 1 January 2015 onwards, increasing the pension to $650 a month;
- An additional $0.050 million for the next tranche of students in the Cook Islands nursing school;
- An additional $0.5 million during 2015 (2014/15 and 2015/16) for coordinating events associated with the fiftieth anniversary of self government.
- An increase in marketing funds for tourism to assist with the change in aircraft type from $4 million over two years to $4.5 million;
- An additional $0.1 million to be deposited into the natural disaster response fund, which will now have $0.638 million available for immediate response in the aftermath of a natural disaster;
- An additional $0.1 million for increasing the allowance for families looking after children under;
- $0.1 million for the community capital fund;
- Refunding approximately $0.4 million in income tax paid on New Zealand superannuation income;
- $0.035 million for the conduct of local elections during 2014/15.
The Government revised the capital plan with around $47 million in spending over two years has been provided for in capital development funding from the Cook Islands Budget including:
- $2 million for bridges and drainage in Rarotonga;
- $5 million for Project City (Airport to Tupapa);
- $1 million over two years for sealing of the runway at Atiu;
- $1.25 million Rutaki Foreshore revetment in 2015/16;
- $5 million for sanitation in Rarotonga and Aitutaki;
- $4.7 million for renewable energy;
- $16 million for Te Mato Vai; and
- $0.9 million water tank subsidy Rarotonga (14/15).
Revenue on a Government Finance Statistics Basis (GFS) was $186.9 million, which includes $63.8 million in development partner assistance, major contributions in 2014/15 include:
- $6.378 million from China for the purchase of heavy machinery for the outer islands;
- $10.8 million from New Zealand for renewable energy infrastructure activity in the northern group of islands;
- $2.913 million from the UNDP for strengthening the resilience of island communities;
- $4.118 million from New Zealand for works associated with Te Mato Vai;$1.914 million from New Zealand for revitalisation of the pearl farming industry;
Total net debt in 2014/15 is forecast to reach $78 million (20 per cent of GDP), the Government announced that it will be sourcing an additional $13 million of debt from the Asian Development Bank (ADB) to fund coupled with grant funding from the European Union and PEC funding from Japan (but outlined as Cook Islands money) totalling $27.8 million which will:
- support the construction of up to six solar photovoltaic power plants in the Cook Islands Southern group (Mauke, Mitiaro, Mangaia, Atiu, Aitutaki and Rarotonga) ;
- provide institutional strengthening to the Office of the Energy Commissioner (OEC) and Renewable Energy Development Division (REDD); and
- provide project management support to the power utilities, Te Aponga Uira (TAU), and REDD to implement core and non-core subprojects.
As per the requirements of the Loan Repayment Fund Act 2013, MFEM will release a report on the impact of the borrowings on the public sector debt position.
Nominal GDP growth was estimated to be 2.6 per cent in 2013/14 increasing to 4.5 per cent in 2014/15 and tourism numbers are expected to reach 122,000 in 2014/15.
Full documentation on the budget can be found in the explanatory documentation contained within:
- Budget Book 1 – Fiscal and Economic Outlook
- Budget Book 2 – Ministry Budget Statements
- Budget Book 3 – Capital and Development
These documents are now available on the MFEM website here.