WILLEMSTAD - The Advisory Council (RvA) has issued strong criticism of Curaçao’s draft budget for 2025. In its advice, the Council points out that the quality of the budget has deteriorated compared to previous years and does not meet the necessary standards. It calls on the government to make essential improvements before submitting the budget to Parliament. The criticism covers various aspects of the budget.
The Council notes that many of the proposed policy goals are vague and not formulated according to the SMART principle (Specific, Measurable, Achievable, Realistic, and Time-bound). As a result, it is difficult to evaluate whether the goals are being met and how effective the policy is.
For instance, in the chapters concerning the ministries, such as the Ministry of Health, Environment, and Nature, there is talk of "improving healthcare." However, this goal is too broadly defined and lacks concrete actions, such as addressing long wait times for specialized care. There is no indication of how many patients will be helped or within what timeframe improvements are expected.
Multi-Year Planning According to the Council, the budget seems to focus exclusively on 2025, with no attention to the continuation of existing policies in the following years. This gives the impression that many policy initiatives will end in 2025, creating an unrealistic picture of policy implementation.
For example, the explanatory memorandum from the Ministry of Economic Development mentions projects to improve the local capital market and introduce a guarantee fund. However, these plans seem limited to 2025, with no clarity on whether and how these projects will continue or be financed in subsequent years.
Social Funds
The Council highlights the severe financial problems with the social funds, including the Swing Fund. According to estimates, the fund will face a deficit of nearly 116 million guilders by 2028, despite previous measures. The Curaçao Swing Fund is designed to absorb fluctuations in the revenues and expenses of social insurance programs, such as the AOV (General Old Age Insurance), the AVBZ (General Insurance for Special Medical Expenses), and the basic health insurance (BVZ).
The government has withdrawn more money from the fund in recent years than has been deposited, leading to an increasing deficit. This deficit is expected to grow even larger in the future, raising concerns about the stability of Curaçao's social security system.
As an example, the Council points to the situation of the Curaçao Medical Center (CMC), which is closely linked to the social funds. The CMC’s financial situation remains critical, and the budget does not clearly indicate what measures have been taken to improve it. The government claims that savings measures are being implemented, but these are not specified in the budget, leaving it unclear how the deficits will be addressed.
Economic Growth The government expects economic growth of 4.5 percent in 2024, with declining growth rates in the following years. However, the Council questions whether this growth is achievable, given the labor market shortages and the lack of concrete actions to support growth.
While there is talk of growth in sectors such as tourism, the budget does not clearly outline the specific measures that will be taken to stimulate this growth. Nor are there any plans presented to address the labor market shortages, which are essential for realizing the expected growth.
Cost Control
The Council notes that government expenditures are not sufficiently controlled. Several items, such as training costs and personnel expenses, show an unexplained increase without proper justification in the budget.
For example, the “Personnel Salaries” item rises from nearly 505 million guilders in 2024 to almost 506 million in 2025. In 2023, actual expenses were 414 million guilders. The Council questions how this increase is justified, especially in light of earlier agreements in the Country Package to control personnel costs.
Execution Capacity Another point of concern is that the implementation of many policy plans is stagnating due to a lack of execution capacity, leading to an accumulation of unexecuted projects.
The example of planned aviation development projects shows that the Ministry of Traffic, Transport, and Urban Planning struggles to attract sufficient qualified staff for key audits from the International Civil Aviation Organisation (ICAO). This puts at risk the attainment of Category 1 status from the Federal Aviation Administration (FAA).
Key Institutions
The Council notes that the budget lacks essential financial information, especially concerning institutions such as the CMC and the social funds.
While the Curaçao Medical Center is a vital part of the healthcare infrastructure, the explanatory memorandum does not clearly state the extent of the CMC’s financial deficit or how it will be addressed. The figures in the budget are insufficiently detailed, making it difficult to get a clear picture of the financial position of this crucial institution.
Conclusion The Advisory Council urges the government to make the necessary improvements to the 2025 budget. The lack of concrete policies, poor cost control, and unclear financial data pose risks to the effective implementation of government policy. A structural improvement in budget quality is essential to meet Curaçao’s economic and financial challenges.