Nuku’alofa — Tonga’s Parliament has approved the Government’s 2026/2027 Budget, paving the way for nearly $949.4 million in spending that the government says is aimed at supporting households, investing in communities, creating economic opportunities, and strengthening the country’s long-term resilience.
According to a government press release issued on 19 June, the budget comprises $735.2 million in cash funding and $214.2 million in in-kind contributions from development partners.
The budget forecasts a $38.1 million deficit for the 2026/2027 financial year.
The government plans to finance the shortfall through $35 million in government bonds and $3.1 million drawn from cash reserves.
Prime Minister and Acting Minister for Finance Lord Fakafanua tabled the budget in Parliament on 18 May.
Following its First Reading, it was referred to the Standing Committee on Finance and Public Accounts before being examined by the Whole House Committee and passed after its Second and Third Readings.
The Legislative Assembly reviewed all 29 government votes covering ministries, departments, and agencies before approving the budget.
Focus on Cost-of-Living Support
The government has described the budget as “A Budget for All Tongans”, with a focus on sharing the benefits of development across the population.
Measures aimed at easing cost-of-living pressures include:
- $18 million for electricity tariff relief and lifeline support.
- $5 million for a Cost-of-Living Allowance for civil servants and their families.
- $900,000 in welfare top-ups for elderly citizens and people with disabilities.
- Continued funding for health, education, and vulnerable families.
- Measures to improve access to affordable finance.
Infrastructure and Community Investment
The budget allocates funding to maintain transport links and public services throughout the Kingdom.
Key investments include:
- $3.7 million in shipping subsidies to support services between outer islands.
- $3.2 million in domestic airline fuel surcharge subsidies.
- Continued investment in roads, bridges, airports, schools, hospitals, and clinics.
- Support for outer-island service delivery and community resilience initiatives.
Economic Growth and Employment
The government says the budget seeks to stimulate economic growth through investment in productive sectors and workforce development.
Initiatives include:
- Funding for youth leadership programmes and vocational training.
- Investment in a HACCP-certified packhouse and food processing equipment to support agriculture and fisheries.
- Continued support for tourism recovery and private-sector development.
- Expansion of digital government services.
Building Resilience
The budget also places significant emphasis on disaster preparedness and climate resilience.
Among the major allocations are:
- $32.8 million for emergency response and national preparedness measures.
- Continued investment in renewable energy projects under the TERM PLUS programme.
- Infrastructure renewal projects aimed at reducing vulnerability to external shocks.
- Support for climate resilience, border security, and national security initiatives.
- Agreements to diversify Tonga’s electricity generation away from diesel dependence.
Parliament also approved the Government Financial Statements for the year ended 30 June 2025, a resolution authorising government borrowing in excess of $15 million, and the Auditor General’s Draft Annual Plan for 2026/2027.
The government said the budget reflects its commitment to improving wellbeing, strengthening communities, expanding economic opportunities, and enhancing Tonga’s resilience in the face of future challenges.
