The Minister of Finance Erica Shafudah has proposed an increase of N$700 million from N$87.9 billion to N$88.6 billion for the 2026-2027 financial year's budget.
The additional funding is intended to meet the Public Service Employees Medical Aid Scheme funding requirements and provide for the government's contingency provision.
The adjustment applies to the budget appropriation and does not represent a N$665 million increase in the overall government expenditure budget, which is projected at N$105 billion for the financial year.
The minister also proposed moving money between existing ministry budgets to cover outstanding bills and essential services, rather than requesting additional funding for every ministry.
The Ministry of Defence is set to receive the biggest chunk of N$200 million for food rations and utilities, while Urban and Rural Development is allocated N$62 million for soil erosion control in Rundu and salary adjustments for regional councillors.
N$179 million is earmarked for the foot-and-mouth disease containment.
Despite the proposed increase in the main appropriation, total government spending, including statutory commitments, is projected to decrease from N$106 billion to N$105 billion.
This means the government expects to spend less overall, even as it increases funding for specific needs.
Interest payments on debt are projected at N$15,4 billion, meaning a large chunk of government revenue will be used to service existing debt rather than fund public services.
“Non-interest expenditure stands at N$89,6 billion. This includes loan-refunded projects. Interest expenditure inside the statutory revenue fund is N$8.6 billion. Interest payments are projected at N$15,4 billion. That is equivalent to 17.5% of total revenue. The budget deficit is estimated at N$16,3 billion or 5.5% of GDP. While the primary deficit is projected at 0.3% of GDP, the total public debt is projected at N$201.7 billion, equivalent to 68.7% of GDP, while government guarantees are estimated to be at 4% of GDP.”
Shafudah also announced that the tax amnesty programme will end on the 31st of this month.
“Since the introduction of the initiative, about 28,157 taxpayers have regularised their tax affairs. All taxpayers who have entered into repayment arrangements can rest assured that these agreements will continue to be honoured. Those who have not yet made repayment arrangements are urged to do so before 31 October 2026.”