PNGBLOGS

by Paul Flanagan   PNG Treasury released last Thursday an update on what may really have happened with the 2015 budget. Like the mid-year Treasury MYEFO update, this is a frightening document that points to a collapse in government revenues of 20 per cent in 2015 relative to the budget, and reveals 2015 expenditure reductions of 37% in health, 36% in infrastructure and 30% in education, areas the government said would be protected. The combined budget deficits over the last three years of 24% of GDP are the largest for a three year period in PNG’s history. The Final Budget Outcome ( FBO ) is one of four key budget documents each year and must be released by 31 March. The 2015 FBO is a comprehensive document that fills in many of the gaps of the 2016 budget, including finally providing detail on where cuts were made in the Supplementary Budget. Key aggregates are shown below. Table 1: Fiscal aggregates from the 2015 Final Budget Outcome (FBO) Note: These fi