The 2025 National Budget of Papua New Guinea, amounting to K28.357 billion, was presented in Parliament on November 29 by Treasury Minister Ian Ling-Stuckey. The budget focuses on addressing law and order challenges, easing living pressures, reducing the deficit, and fostering economic growth.
The budget, K980 million larger than its 2024 counterpart, projects revenues of K25.408 billion—an increase of K2.014 billion—reducing the deficit to K2.949 billion (2.2% of GDP). Debt-to-GDP is set to decline to 47.4%, with a budget surplus anticipated by 2027 and debt repayment by 2034, the Treasury said.
Key allocations include a significant boost for the police force, defense, judiciary, and essential services, aiming to ensure national security and support economic development.
In light of 2024’s tragic events—including tribal violence, riots, and the Mulitaka landslide—the budget prioritizes law and order.
The police force will receive a 19% wage increase and funding to expand to 10,000 personnel by 2030. Operational and capital funding will rise by 67% and K200 million, respectively. The defense budget also sees a 15% wage hike and a 116% increase in capital investment.
The judiciary’s 25% operational funding increase aims to expedite justice and reduce crime-related tensions, creating a more stable environment for citizens and businesses.
The economy is forecast to grow from K124 billion in 2024 to K137 billion in 2025, driven by a 5.2% growth in the non-resource sector. This marks the fifth consecutive year of over 4% growth in this sector, a first for PNG.
Treasurer Ling-Stuckey emphasized the government's commitment to achieving a K200 billion economy by 2030. Papua LNG and other major resource projects are expected to boost this growth.
The Public Investment Program (PIP) is set at K7.617 billion, a 273% increase from 2018, focusing on rural road expansions, market access for farmers, and transformative projects like the Lelet Plateau road.
To ease financial pressures on families, the budget includes K685 million in household assistance for 2025, part of a K2.322 billion four-year package. Measures include:
- GST removal on 13 essential items, including rice, chicken, and sanitary products, starting July 1, 2025.
- Continued school project subsidies benefiting 2.3 million students.
- Maintaining the K20,000 tax-free threshold and freezing excise indexation on tobacco and alcohol.
- Raising the stamp duty exemption threshold for first-home buyers from K500,000 to K700,000.
“These measures directly address cost-of-living pressures,” Ling-Stuckey stated, noting the need to support citizens as the economy recovers from challenges inherited from previous administrations.
Education and health funding will increase by 11.6% and 13.1%, respectively, with provincial funding rising by 20% to improve service delivery nationwide. Education allocations will reach K4.568 billion, while health funding will total K2.860 billion.
The 2025 budget reflects PNG's progress toward achieving Prime Minister James Marape’s vision of a K200-billion economy by 2030. The consistent non-resource sector growth and record investment in infrastructure demonstrate the government's long-term planning.
Marape commended the budget, describing it as a testament to the government’s disciplined fiscal management and its commitment to building a secure and prosperous PNG.
“This budget marks a turning point—a framework to secure our future for the next 50 years,” Marape said, as PNG prepares to celebrate its 50th Independence anniversary.
