Opposition Senator Carlos James have described the 2026 budget as a “dizzying maze of contradictions.”
James said the budget is less a roadmap for growth and more a fiscal sleight of hand designed to mask a profound lack of vision.
James stated that the budget lacks a clear direction for continuing the country’s trajectory of positive growth.
“There is a perceived absence of significant initiatives regarding climate finance, catastrophe bonds, or disaster risk management”.
A major concern of Senator James involves the transition from low-interest concessionary loans to more expensive local financing.
He said the budget shifts dependency toward $200 million in local loans, which are projected to carry interest rates between 6% and 13%, compared to previous concessionary external loans that averaged between 0.75% and 2.5%.
James said the proposals for debt swaps are unattractive to the market because the current external debt already has such low interest rates that there is little incentive for agencies to buy it.
Concerns were raised that the debt-to-GDP ratio has climbed to approximately 80% (up from roughly 65-68% in 2019), potentially affecting the government’s capacity to repay loans within certain timeframes.
The budget was further criticized for a “strategic withdrawal” from infrastructure projects essential for long-term growth and employment. Notable missing or deferred projects include:
Tourism and Infrastructure: The cancellation of the Salt Whistle Bay Coastal Restoration, the Mount Twin Hotel Project, and the new city at Arnos Vale.
Education and Culture: A 56% cut to the (Math) program in schools, the removal of the Brighton School construction, and the cancellation of three cultural hubs that had previously secured 2% interest funding.
Agriculture and Science: The removal of the Alba food security initiative and the establishment of a science laboratory.
James suggested the budget has triggered “investor panic” rather than confidence. The lack of announcements regarding new hotel developments (specifically in Mount Wynne, Peter’s Hope, and Cumberland) is seen as a retreat that could lead to an erosion of market sentiment.
James said while capital projects are being cut, the budget reportedly increases the permanent wage bill and recurrent expenditure (now at 1.3 billion) by adding new ministries, ministers, and parliamentary secretaries.
He highlight the allocation of $2.1 million for repairs to the Prime Minister’s residence and a new fleet of vehicles, while the National Development Bank is only capitalized with $500,000, and said non-tax revenue is projected to drop by 40%, which may create further fiscal instability.
In regards to the National Housing Recovery and Resilience Fund. He argued that 73% of the housing budget now relies on local loans and that the government is moving away from direct rehabilitation assistance toward offering loans to citizens to repair their own homes. This is contrasted with previous programs where the government provided both materials and labour directly.