The Government of Barbados has formally presented its comprehensive budget for the 2026-2027 fiscal year to Parliament, initiating the legislative process for national expenditure and revenue allocation. This financial blueprint, which also includes a revised forecast for the ongoing 2025-2026 period, will undergo detailed parliamentary scrutiny starting March 2, 2026, through debates on the Appropriation Bill.
For the current 2025-2026 financial year, the revised fiscal outlook indicates an expected cash revenue of $3,856.0 million, predominantly from tax contributions ($3,663.4 million), with the remainder from non-tax and grant sources. Total expenditure is projected at $3,939.8 million, leading to a modest deficit of $83.8 million, representing -0.5% of the estimated GDP of $16,242.8 million. A robust primary surplus of $658.4 million (4.1% of GDP) underscores a stable fiscal foundation.
Looking ahead to 2026-2027, the government anticipates a significant revenue expansion. On a cash basis, current revenue is projected to reach $5,179.0 million, marking a substantial 34.3% increase from the revised 2025-2026 figures. Total expenditure on an accrual basis, inclusive of amortization, is set at $6,138.6 million. Converted to a cash basis (excluding amortization), this translates to $5,075.5 million, allocated between current ($4,185.7 million) and capital ($889.8 million) expenditures. This reflects a notable $766.7 million increase in current spending compared to the previous year.
Key expenditure drivers include a significant rise in goods and services funding, set to increase by $376.2 million to $966.7 million, and a 32% jump in current transfers to $1,520.1 million. Debt servicing remains a major outlay at $1,495.9 million. Despite this, the primary balance is forecast to be a strong surplus of $817.5 million, equating to 4.8% of a projected GDP of $17,064.7 million.
The budget allocates strategic investments across critical sectors, including:
* $182.2 million subvention for the Queen Elizabeth Hospital.
* $121.5 million for the Social Empowerment Agency.
* $242.0 million for the Barbados Water Authority’s capital projects.
* $116.0 million for the Barbados Defence Force.
* $78.4 million for Special Needs grants, Pensioners, and Welfare.
Additional provisions target long-term economic resilience, including $75.0 million for the Economic Diversification Growth Fund, $56.0 million for the Resilience and Regeneration Fund, $52.2 million for the Barbados Republic Child Wealth Fund, $23.0 million for the Smart Energy Fund, and $20.0 million to capitalize the Blue Green Bank, signaling a strong commitment to sustainable and diversified economic growth.