PHILIPSBURG: --- Minister of Finance Marinka Gumbs addressed the Central Committee of Parliament today, presenting the second draft of the 2025 budget that shed light on the challenges encountered during the ratification of the original submission earlier this year. Her remarks focused on the technical and procedural hurdles, the steps taken to resolve these issues, and the way forward for St. Maarten's budgeting process.
Challenges with the Original Budget
Minister Gumbs opened her presentation by acknowledging the significant obstacles faced during the ratification of the original 2025 budget, which had been unanimously approved by Parliament back in January. She outlined how amendments and modifications introduced by both Parliament and the Government created legal, numerical, and procedural inconsistencies that stalled progress.
"While the intentions of Parliament were clear, the amendments required further technical and legal refinement to be incorporated into the budget," she shared. Despite efforts to address these discrepancies, it became evident that the issues could not be resolved within the existing framework of the initial budget.
This led to the Government officially informing Parliament of its inability to move forward with ratification, opting instead to draft a new version of the budget that fully integrated the approved initial amendments.
Solutions and a Revised Draft
The newly submitted draft of the 2025 budget incorporates all amendments and modifications passed by Parliament in January. While this approach deviates from standard practice, it was deemed the most practical and transparent way to enact the approved budget. Minister Gumbs explained how technical adjustments were made to ensure that the revised figures remained consistent, aligned, and executable in practice.
One of the key aspects of her presentation was a slide-by-slide breakdown of how each modification had been incorporated. She highlighted instances such as discrepancies in figures caused by rounding and amendments that required corrections to maintain alignment with the overall budget totals. For example, a reduction in travel costs initially misstated in the amendment document was corrected from 5,000 guilders to 20,000 to ensure consistency.
Minister Gumbs reassured Parliament that the latest draft reflects the approved modifications and adheres strictly to the country's budgetary and legislative standards.
Focus on Financial Performance
Minister Gumbs dived deeper into the financial aspects of the new draft, providing a high-level overview of projected income and expenditures, as well as a review of Q1 2025 actuals compared to the submitted budget figures.
The 2025 budget projects total revenue at XCG 586 million and total expenditures at XCG 577 million, resulting in a projected surplus of XCG 9 million. Key revenue sources include tax income, which accounts for XCG 453 million, and funds from the Technical Assistance program.
Comparing the budgeted Q1 figures with the actual results revealed encouraging findings. Total revenue for the first quarter exceeded expectations by 15 million guilders, driven largely by higher-than-expected wage tax and turnover tax collections. On the expenditure side, actual Q1 figures were 19 million guilders lower than budgeted, mainly due to delays in personnel-related costs and project expenditures.
Unlike Q1 of last year, where revenues fell short early, forcing budget cuts, this year started with revenues exceeding expectations. This is an encouraging sign that our 2025 budget remains realistic and stable,” Minister Gumbs noted.
Addressing Structural Issues
The delay in ratifying the 2025 budget highlighted the need for improved processes in handling amendments, and Minister Gumbs reiterated her commitment to addressing these challenges. She emphasized the importance of collaboration between the Government and Parliament and proposed establishing a clear framework to manage amendments efficiently.
To that end, she announced plans to work with stakeholders—including the Governor, the Council of Advice, and external auditors such as SOAB—to identify solutions to prevent similar delays in the future. This initiative includes a more thorough legal and technical review of amendments before their incorporation, as well as ongoing consultations between relevant parties to ensure alignment.
Outlook for the Nation
Minister Gumbs concluded by highlighting the positive economic outlook, tied to the stability of the 2025 budget. She cited several factors, including an anticipated increase in tax revenue tied to economic growth, a projected 2-3% inflation rate, and promising Q1 results.
However, she also noted areas of concern, such as rising healthcare costs linked to an aging population and projected increases in personnel costs due to digital transformation initiatives, as well as operational expenses for new facilities.
"While we continue to focus on our financial stability and our commitments to the people of Sint Maarten, this experience underscores the need for vigilance, collaboration, and systemic improvements," she said.
Moving Forward
Minister Gumbs concluded her address with a call for Parliament to engage in constructive discussions as the country moves closer to ratifying the 2025 budget. "We must ensure that exercising our legislative rights does not come at the expense of the country. Through cooperation and mutual respect, we will meet these challenges head-on and continue to build a stronger St. Maarten," she concluded.
The second draft of the 2025 budget is now moving forward for review, with a public debate scheduled for next week to discuss its content further. For now, today’s presentation sets a promising tone of transparency and accountability as the Government and Parliament work to finalize this crucial piece of legislation.
