National Assembly Approves Budget Appropriation Bill for 2025-26 and Supplementary Budget Appropriation Bill for 2024-25

Strategic Insights -

The National Assembly of Bhutan, in a unanimous decision, approved the Budget Appropriation Bill for the Financial Year 2025-26, amounting to Nu 138.55 billion, and the Supplementary Budget Appropriation Bill for the Financial Year 2024-25, totaling Nu 1.59 billion. The legislative session followed extensive deliberations on 15 recommendations submitted by the Economic and Finance Committee (EFC), which resulted in the endorsement of 12 and rejection of three proposals. The supplementary budget saw an upward revision of Nu 1.59 billion, primarily attributed to the inclusion of Nu 1.41 billion in external grants and loans, and Nu 174.87 million from internal grants. The allocation of resources through this budget is expected to play a pivotal role in achieving Bhutan's national objectives, particularly in improving rural livelihoods, boosting tourism, and strengthening local governance.

Key Takeaways:

  • The National Assembly approved the Budget Appropriation Bill for 2025-26 and the Supplementary Budget Appropriation Bill for 2024-25 with all 44 members voting in favor.
  • The EFC submitted 15 recommendations, with 12 being endorsed and three rejected by the House.
  • The supplementary budget for the fiscal year 2024 to 2025 saw an upward revision of Nu 1.59 billion, mainly due to Nu 1.41 billion in external grants and loans, and Nu 174.87 million from internal grants.
  • Key allocations in the revised supplementary budget include Nu 263 million for the Rural Life Insurance Scheme and Nu 31.5 million to support the implementation of the third child policy.
  • The EFC emphasized the need for strict adherence to the Public Finance Act and recommended that general reserve allocations should be directed solely toward their intended purposes.
  • A major recommendation called for transferring Nu 11.32 billion allocated for centrally executed local government (LG) capital programs to the respective Local governments.
  • The House supported the removal of the Nu 343.7 million allocation intended for an internet bandwidth subsidy, and the Nu 49.5 million subsidy for tourist airfares.
  • The EFC called for full integration of all components of the Economic Stimulus Programme Fund to improve financial transparency and accountability.
  • The Ministry of Agriculture and Livestock faced budgetary adjustments, with the proposal to allocate funds for strawberry farming projects being rejected.

Statistics:

  • Budget Appropriation Bill for 2025-26: Nu 138.55 billion
  • Supplementary Budget Appropriation Bill for 2024-25: Nu 1.59 billion
  • External grants and loans included in the supplementary budget: Nu 1.41 billion
  • Internal grants included in the supplementary budget: Nu 174.87 million
  • Allocation for the Rural Life Insurance Scheme: Nu 263 million
  • Allocation for the third child policy: Nu 31.5 million
  • Budgetary adjustments for the Ministry of Agriculture and Livestock: Nu 149.12 million
  • Recommended reduction in the fiscal deficit: 5% of the Gross Domestic Product (GDP)

Sources:

  • National Assembly of Bhutan (2023)
  • Economic and Finance Committee (EFC) (2023)
  • Ministry of Finance, Royal Government of Bhutan (2023)
  • The Bhutanese (2023)