BY NED GAGAHE

The Public Accounts Committee (PAC) has launched its inquiry into the 2025 Appropriation Bill 2024, which seeks Parliament’s approval for a total expenditure of $4.83 billion to fund government operations and services for the year.

The Bill includes provisions for annual borrowing limits, allowing borrowing through Treasury Bills for exceptional circumstances, and from development partners or domestic financial institutions to finance key infrastructure projects.

Accompanying the Bill are detailed Budget Papers outlining financial strategies, as well as recurrent and development budget estimates.

Key government officials, including those from the Central Bank of Solomon Islands and various ministries, participated in the first day of the inquiry on Monday, 25th November 2024.

The PAC’s inquiry will continue over the next two weeks, with a final report to be presented for parliamentary debate. A statement from Parliament this week revealed that the Bill seeks Parliament’s approval for a total expenditure of Four Billion, Eight Hundred and Thirty-Two Million, Two Hundred and Seventy-Three Thousand, Seven Hundred and Thirty-Nine Dollars ($4,832,273,739) to fund the government’s operations and services for the year 2025.

“This Bill establishes annual limits on new government borrowing, in accordance with Section 66(2) of the Public Financial Management Act 2013, allowing borrowing through Treasury Bills for exceptional circumstances, and from development partners or domestic financial institutions to finance high-priority infrastructure and development projects,” the statement said.

Key government representatives, including officials from the Central Bank of Solomon Islands, the Ministry of Finance and Treasury, the Ministry of Education, and the Ministry of Health, were present for the first day of the inquiry.

“This Bill outlines annual limits on new government borrowing in line with Section 66(2) of the Public Financial Management Act 2013. Two categories of permitted borrowing are stipulated:

• Borrowing by way of Treasury Bills to address exceptional circumstances.
• Borrowing from development partners or domestic financial institutions to fund high-priority infrastructure and development initiatives.”

The Bill also establishes specific borrowing limits for each of these categories. It includes provisions for the Minister for Finance and Treasury to issue Advance Warrants and Contingency Warrants throughout 2024.

For a proper understanding, the Bill should be read alongside the accompanying Budget Papers, particularly:

• Budget Paper 1: Financial Policy Objectives and Strategies Statement.
• Budget Paper 2: Recurrent Budget Estimates.
• Budget Paper 3: Development Budget Estimates.

The Bill authorizes the Minister for Finance and Treasury to issue a General Warrant, in accordance with Sections 55 and 56 of the Public Financial Management Act 2013, to the Permanent Secretary of Finance and Treasury for the amount of $4,832,273,739. This enables the Permanent Secretary to issue Accounting Warrants as outlined in Section 57 of the Act.

PAC’s inquiry will continue over the next two weeks, with a comprehensive report to be submitted for parliamentary debate. Budget briefs from the recent Floating Budget Office review will inform MPs’ discussions.