On Tuesday, March 25, 2025, Prime Minister Hon. Philip J. Pierre presented the Estimates of Revenue and Expenditure for the fiscal year 2025-2026. The presentation reaffirmed the government's commitment to responsible financial management, prioritizing the welfare of the people of Saint Lucia through sustainable fiscal practices and investment in infrastructure, health, and social development. The Prime Minister highlighted that, "This year's Estimates will build on last year's budget theme, the Year of Infrastructure, but will be complemented by a special focus on health and social development, citizen safety, and job creation."

The forecasts indicate projected revenue and grants of $1.71 billion, against an expenditure of $2.058 billion (the largest injection in the history of this democracy), resulting in a deficit of $202 million, primarily offset by strategic borrowing and revenue from taxes and grants. The government's ongoing focus on addressing the needs of vulnerable populations and increasing economic activity is evident through proposed increases in wages and support programs amid global economic uncertainties.

Key Points:

The government aims to continue its people-centered approach in the 2025-2026 estimates, focusing on economic growth and societal welfare.

Total Revenue and Grants for fiscal year 2025-2026 are projected at $1.71 billion, representing an 8.7% increase over the previous year.

Total expenditure of $2.058 billion is proposed, resulting in a primary surplus of 0.5% of GDP ($34.7 million), continuing the trend of the prior year. Consequently, an overall deficit of $202 million (or 2.7% of GDP) is projected, which remains within prudent fiscal limits of 3.0% of GDP.

A primary surplus of $76.94 million is projected for the 2024/2025 financial year, with another anticipated for 2025/2026—a strong indicator of sound fiscal management and sustainable debt levels. This surplus means the government can cover its interest obligations without additional borrowing, reinforcing its commitment to responsible financial planning.
Notably, this marks the third consecutive year of primary surpluses, following years of significant deficits (i.e., -$327.32 million in 2020/2021 and -$204.73 million in 2021/2022). The recovery began with the first budget of the Hon. Philip J. Pierre Administration in 2022/2023, demonstrating a consistent effort toward economic stability and prudent financial management.

This fiscal year, recurrent revenue of $1.62 billion is projected to adequately finance recurrent expenditure (operations) of $1.42 billion.

Significant allocations in the budget include $1.6 billion for recurrent expenditures and $325.6 million for capital projects aimed at enhancing infrastructure and public services.

The government has implemented various supportive measures for public servants and vulnerable groups to mitigate the effects of rising living costs, including increases in pensions and the introduction of a minimum wage.

A prudent mix of loans, grants, and bonds will be utilized to finance the anticipated deficit, indicating ongoing confidence in the country's fiscal strategy.