The budget for the 2007/08 financial year will not include any new revenue measures.
Leader of Government Business Kurt Tibbetts made the surprising announcement during the Cabinet press briefing on Friday.
As recently as last December, the government stated it might have to implement up to $4.7 million in additional revenue measures. But that has changed.
‘We do recognize what the situation is with regard to the cost of living and all of that,’ Mr. Tibbetts said, adding that the government did not want do anything that would add to the cost of living problem.
The Strategic Policy Statement for 2006/07 projected $28 million of revenue measures through the next two financial years, with $25 million coming in 2006/07 and $3 million coming in 2007/08.
Last December, Financial Secretary Kenneth Jefferson said the government would only implement $23.3 of revenue measures in 2006/07.
At the time, however, Mr. Tibbetts said for the 2007/08 budget the Government might have to implement the difference between the originally estimated $25 million for 2006/07 and the $23.3 actually implemented, but said the revenue measures would not surpass the $28 million over the two financial years.
If that had been the case, a maximum of $4.7 million in new revenue measures could have been implemented.
The revenue measures were needed to help finance the government’s capital spending plan, which has risen from an envisioned $235 million over four years in the 2006/07 Strategic Policy Statement, to a projected $332.2 million over the next three years in the 2007/08 Strategic Policy Statement.
Mr. Tibbetts has said cash surpluses and more than $300 million in borrowings would be used to fund the capital projects.
Although Mr. Tibbetts did not say at Friday’s press briefing what specific part of the government’s planned spending would not be implemented to counterbalance the lack of additional revenue measures, he announced recently that the second government office accommodation project would not proceed during the current administration.