From the House, by Pesi Fonua.

Tonga's new big budget offers a $5 million boost for government salaries along with new charges to be imposed on foreign exchange and a large increase in airport tax to raise funds for the 2019 Pacific Games.

The Tonga Government budget of $496 million for 2015-16 was announced by the Minister of Finance, Hon. Dr ‘Aisake Eke in the Tongan Legislative Assembly on June 2.

The 2015-16 budget is $12.3 million more than the previous year's budget of $483.7 million.

To ascertain that there would be smooth sailing during the budget debate in the House, the Minister poured a drum of oil overboard, by announcing a $5 million salary increase for all civil servants, including Members of Parliament and Members of the Judiciary. He said that this $5 million salary rise would take place at the beginning of the new financial year in July.

Hon. Eke made a presentation to the House summarizing his budget - which consists of four large sets of documents. None of the budget documents have been released outside of the House and the full details of the documents will not be accessible to the public and the media until after the budget has been passed by the House.

The Minister said that 47 percent of the budget will be funded by government and the remaining 53  percent will be financed by foreign development partners.

Among the documents presented with the 2015-16 National Budget, was a Tonga Strategic Development Framework for the next ten years 2015-25.

Hon. Eke also said there was a vision for the new budget, which is: “God and Tonga are our inheritance”.

The two top budget allocations are the Ministry of Education with $44.4 million, and the Ministry of Health with $30.2 million.

Gone up

On the rise also are the allocations for constituents development programs to go up from $2 million to $2.55 million or $150,000 annually per constituency.  Outer-islands development allocations also jumped from $190,000 to $600,000.

Other allocations include $700,000 for the Red Cross, $8 million for Fisheries, $500,000 for Youth and $800,000 for Women.

Pacific Games fund

The Minister announced the establishment of a special fund to enable Tonga to host the 2019 Pacific Games. He said that during the next five years Tonga's Departure Tax would go up by $100, from $65 to $165. The budget also proposes an increase in the charge for foreign currency exchange, with the idea for foreign currency exchange agencies to reduce their profit margins.

However, the levy on foreign currency exchange would not apply to aid money that comes into the country from foreign aid donors.

Food duties

The budget proposes to increase the duty on “unhealthy foods and drinks”, while decreasing the duty on healthy imported food and drinks. Therefore, he said that duty on imported chicken would be dropped from 51% to 17.5% and on tinned fish from 33% to 12.5%.

However, the People’s Representative for the Vava‘u Constituency No. 15 Samiu Vaipulu questioned the logic of the increase in Departure Tax and the cost of Foreign Currency exchange. He expressed his concern over the impact of the increases on the tourism industry as well as the additional cost of foreign currency exchange on the hard-earned money sent home by Tongan fruit pickers and through foreign remittances.

His unanswered question was – “Is there any other way for Tonga to raise the funds to host the 2019 Pacific Games?”

The only other strong reactions to the Minister of Finance’s budget presentation was from the People’ Representative for Ha’apai Constituency No. 12, Vili Manuopangai Hingano, who queried the vast contrast between the picture of the Tongan economy that Hon. ‘Aisake Eke had painted to what the Prime Minister Hon. ‘Akilisi Pohiva had been telling the media in New Zealand - when the Prime Minister said that the Tongan economy is in a dire state.

There was no response from government, to his query.

After a first reading in the Legislature, the Budget was passed unanimously.

After the second reading in the Legislature, the members were raising their hands to pass the Budget when the Speaker Lord Tu'ivakano, reminded the members that after a second reading the Budget would become law and that would be it.

Noble's Representative Lord Tu‘ilakepa saved the debate by moving for the Budget to go into the House for further consideration.

The budget debate was continuing today, Thursday June 4.