MercoPress. South Atlantic News Agency

Falklands' annual inflation to March 2.3%: under spend of the 2018/19 budget

MLA Spink expressed satisfaction that inflation seemed to be under control and noted that it could be expected to drop following a forecast reduction in fuel prices

Contrary to what happens in the region, and for that matter in most of the world, inflation in the Falkland Islands is on target and the budget performance remains under spent with strong Capital projects carryover from previous budgets.

Three papers entitled: Stanley Retail Price Index, Summary Financial report and Quarter 3 2018/19 Capital Projects Progress Report were presented in the public session of Wednesday’s meeting of the Standing Finance Committee, chaired by MLA Roger Spink.

Dealing with the quarter ending March 31, 2019, the Retail Price Index (RPI) showed an increase of 0,5% over the previous quarter. This would represent a projected 2.3 % increase over the year, 0.6% down on the previous quarter’s projection.

MLA Spink expressed satisfaction that the rate of inflation seemed to be under control and noted that it could be expected to drop following a forecast reduction in fuel prices.

Fourteen items make up the “basket” of categories contributing to the RPI estimate, with vehicle insurance and the price of ready meals singled out by the report as the major contributors to quarterly inflation.

The Head of Finance’s Summary Financial Report as at March 2019 for the 2018/9 financial year contained few, if any, surprises, causing MLA Spink to note with evident satisfaction that things were going “almost on budget.”

Much the same was the case with the report presented by the Head of Finance and the Management Accountant whose purpose was stated as being “to provide Members with an interim report on the progress of all capital projects under the FIG Capital Scheme up to the end of the third quarter of this financial year.”

The progress of each individual capital project was detailed in the report indicating whether spending to date was above or below what had been projected to the end of March.

Members were informed that as of March 31, £15m had been spent out of a total budget of £58.8m and a further £7.8m of commitment had been raised.

The £15m spend figure represented a £3.7m under-spend against the estimated spend to this date given in the full year 18/19 budget profile.

The 18/19 budget of £58.8m includes carryover of unspent 17/18 budget and according to the report before the Committee; budget managers forecast that £29.1m of capital expenditure budgeted in 2018/19 may be carried over to 2019/20.

On this basis it is no longer expected that the projected budget of £58.8m will be spent by the end of the 2018/19 financial year.