In the National Assembly today, the finance minister reported on the improvements in the fiscal deficit, and tighter controls over the use of the General Reserve. The minister shared this while presenting the Action Taken Report on the Financial Year 2025-26 budget. The report also highlighted the progress on government-supported farm projects and the discontinuation of airfare subsidy.
Although the approved budget showed a fiscal deficit of over six per cent, the finance minister reported that they have managed to reduce it to less than 4.5 per cent in the first quarter of the 2025-26 financial year.
In the previous National Assembly session, the Economic and Finance Committee recommended the ministry decrease the fiscal deficit to five per cent.
A fiscal deficit occurs when a government’s total expenditure exceeds its income excluding borrowings.
Finance Minister Lekey Dorji said, “The finance ministry has been implementing fiscal consolidation measures. We are regulating it through tighter government spending and have seen increased domestic revenue.”
Despite the Economic and Finance Committee’s recommendation to remove nearly Nu 150 M in funding for the Chirup commercial farms and the mega strawberry farm projects, the government has continued with the plan.
According to the agriculture and livestock ministry, these farms are expected supply more than 2,500 metric tonnes of fruits and vegetables annually to the five Gyalsung academies.
The ministry added that the projects will strengthen national food security, reduce import dependence, and create employment opportunities.
The committee also advised discontinuing the nearly Nu 50 M airfare subsidies, since it contradicts the ‘High Value Low Volume’ tourism policy. The finance minister said the allocation was removed.
Regarding concerns over potential misuse of the more than Nu 4bn General Reserve, the finance minister affirmed that all allocations strictly adhere to the Constitution and relevant Acts and guidelines.
“The General Reserve is audited and reviewed by the Royal Audit Authority. This ensure that all expenditures are transparent, compliant with the guidelines, and properly accounted for. Robust checks and balances are therefore in place to safeguard the prudent and accountable use of the reserve.”
Further, the finance minister said that budget decisions are aligned with national priorities and interests.
Deki Lhazom
