Chaudhry Criticises 2025/26 Budget as Inadequate and Irresponsible

Fiji Labour Party Leader Mahendra Chaudhry has described the 2025/26 National Budget as a “damage control” measure designed to appease a public reeling from the Coalition Government’s previous two budgets.

“It is a damage control Budget to appease the people after the pain and suffering inflicted by the Coalition’s past two budgets,” Mr Chaudhry said in a statement released today.

He took aim at Finance Minister Professor Biman Prasad’s justification of the Budget as a “response to extraordinary circumstances,” saying those circumstances were of the government’s own making.

“These ‘extraordinary circumstances’ were created by his own failed two previous budgets,” he said.

Mr Chaudhry criticised the government’s decision to initially raise VAT to 15% in its first Budget, calling it “a huge blunder” that triggered a cost-of-living crisis and had negative effects on the broader economy.

“To reduce VAT now to 12.5% is a token reaction to the angry public sentiment. However, it is not enough to offset the cost of living as businesses will attempt to retain their margins and not reduce prices,” he warned. “Labour had called for a reduction to at least 10% to make a credible impact.”

He also dismissed the 5% increase in welfare payments as inadequate in light of rising global inflation.

“The 5% increase in Welfare benefits is not sufficient to match the cost of living as global inflation is expected to rise in the next 12 months,” Mr Chaudhry said.

He further condemned the government’s projected $886 million budget deficit, saying it would drive Fiji deeper into an already unsustainable debt situation.

“Fiscal deficits under the Coalition have risen from 3.5% in 2023/24 to 4.5% in 2024/25 and now 7.5% under the 2025/26 Budget,” he said. “It is contrary to the Coalition’s promise of ‘responsible fiscal management’.”

Chaudhry argued that many of the expansionary measures in the Budget appeared more cosmetic than practical.

“In many cases, the expansionary measures announced are meant for show – attempts to dazzle with unrealistically big figures and high-sounding projects,” he said. “There is not much hope of these being realised on the ground because of a lack of capacity and the continuing shortage of the required skilled workforce.”

He added that the government had failed to consider these serious constraints when preparing the Budget.

A more detailed statement from the Labour Party is expected following a fuller analysis of the Budget.

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