Tonga's increase in public spending raises fiscal concerns
Wednesday, December 2, 2015 - 20:07
A waning commitment by the Tongan government to reform has caused delays in grants for budget support and raises concerns regarding long-term fiscal sustainability, the Asian Development Bank warns in the December 2015 issue of the Pacific Economic Monitor - Budget Analysis. Tonga's budget plans for FY2016 will see another large increase in public spending.
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Increase in spending also
Increase in spending also raises independence and sovereignty concerns, because of heavy reliance on foreign aid. It's also a ticking bomb, if the budget is largely wages, and since half the budget is reliant on other nations (and entities), our civil servants also depend on other nations for pay. Imagine what would happen to the state if our civil servants don't get paid?
To be fair, I think part of the responsibility also falls on the voters who pressured Government to do something about the economy, and the increase in spending is probably what they had in mind, and it's probably largely why we seeing some growth in the economy. Unfortunately, it's not the right policy, even if I were in Government and my wages dependent on taxes, I'd still see private sector growth as the key to our situation. It's not a private vs public sector thing, it's a sustainability thing.
I encourage voters, to be more aware of what we're asking because the way we are going it's more taxes (& fundraisings to pay for basic necessities, also what I consider a form of tax in it's purpose and need, though not obligatory), more regulations and price controls - reversing away from efficient free markets. And worst of all losing our independence. Many just stop at what it says officially, on paper, about our independence and so believe there is no longer a need to fight for our independence. But due to our financial situation we are losing it.
KJV Proverbs 22 7 "The rich ruleth over the poor, and the borrower is servant to the lender."
We should be friends with China, NZ, Aus etc, but because we are so indebted or in need of their help for budgetary support, what do we do when we have to speak out against some of their actions, e.g pressuring NZ and Aus on making bigger commitments on climate change, or speak out against China building islands threatening peace in South East Asia where I understand we get our diesel and gas? Because of our situation, in our own lives we know it's not wise to anger the people we rely heavily on or who we are so indebted too, same applies for us as a nation. We're lucky we haven't been too reckless with our relations with those countries so far, but it is a time for creativity and new ideas, new policies. I encourage the voters and also Government to not feel stuck to this current direction, there are many ways to the same destination. God bless