NASSAU, The Bahamas – While addressing measures relating to Expenditure for the upcoming fiscal year, Prime Minister and Minister of Finance the Hon. Philip Davis announced that his Government was moving forward with the second phase of its comprehensive Public Service Salary Review.
“The first phase, now complete, focused on middle management and above,” Prime Minister Davis said, during his Contribution to the 2025/2026 Budget Debate, in the House of Assembly. “Public servants will see increases in their salaries at the end of this month.”
“Phase two is coming, which will bring salary adjustments of two to eight percent for the remainder of the public service, a vital step to help restore purchasing power lost to inflation, while also promoting fairness, retention, and morale across the public sector,” he added. “The second phase will be implemented in September 2025.”
Prime Minister Davis announced that his Government was also expanding the health insurance coverage for all government employees.
That initiative, he pointed out, would provide broader protection for public officers; reduce out-of-pocket medical costs; and improve overall access to healthcare “for those who serve our nation”.
“We’re also modernizing the delivery of healthcare benefits by enhancing the National Health Insurance programme,” Prime Minister Davis said.
“We are transitioning the prescription drug benefit from the National Insurance Board to NHI, supported by a new, upgraded IT system,” he added. “This digital shift will improve operational efficiency, ensure private insurers pay when required, and help reduce pressure on the public purse.”
Prime Minister stated that, in the upcoming fiscal year, his Government will continue to make “meaningful progress” with what he called One Tax Bahamas, his Government’s effort to build a “simpler, smarter, and more transparent tax system”. That, he added, will be ready in January 2026 to incorporate the Domestic Minimum Top-up Tax (DMTT), which was already enforced.
“We are developing a modern digital platform so that individuals and businesses can register, file, and pay taxes online, with no more long lines or piles of paperwork,” Prime Minister Davis pointed out.
He added: “To date, we have designed the foundation for a secure and user-friendly tax system; began development of a new taxpayer registration portal and website; drafted robust data protection and privacy policies, which will include provisions to address issues of cybercrime and wrongful use of artificial intelligence – AI; and engaged key stakeholders across government to ensure the system serves all Bahamians effectively.
“To stay on schedule, we’ve made several key strategic decisions, including using a cloud-based solution to prevent delays, and to ensure the system is ready by March 2027.”
Prime Minister Davis noted that his Government continued to work hand-in-hand with its partners to meet international standards and deliver a tax system that worked for the Bahamian people.
“We are continuing our commitment to Grand Bahama, allocating $1 million for the West Sunrise Highway, and maintaining support for (the Ministry of Grand Bahama’s) COLLAB and the Grand Bahama Humane Society,” he said. “We are also continuing our support to the Small Business Development Centre in Grand Bahama to ensure that entrepreneurs have the tools they need to thrive.”
“Across The Bahamas, we are investing $31 million in road remediation, drainage infrastructure, sidewalk development, and roadworks,” Prime Minister Davis added.
Additionally, $6 million had been allocated for airport infrastructure development, he announced.
“We are making significant investments in health, including funding new medical equipment; preparatory work for the New Providence hospital; construction of new clinics in the Family Islands; and maintenance and upgrades for community clinics and medical facilities,” Prime Minister pointed out.
“We are prioritizing food security by investing in the development of the Centre for Food and Nutrition Security, and continuing support for farmers and the Golden Yolk Program,” he added. “These efforts will help reduce our dependence on imports and strengthen local food systems.”
Prime Minister Davis reiterated that Education remained a cornerstone of The Bahamas’ national development.
He noted: “In this budget, we are allocating $25.8 million for the maintenance and expansion of public primary and secondary schools; investing $8.6 million in school ground improvements and digitization; providing $37.9 million in scholarships for UB, BTVI, and international studies; supporting operations at UB and BTVI with over $52 million allocated in the upcoming budget; and giving grants to the Centre for the Deaf, the School for the Blind, and Stapledon School.”
He added that his Government was also addressing housing and social needs by allocating $5 million for small home repairs; and providing $2 million to continue the Rent-to-Own Housing Programme.
“Work is being continued with the Renaissance Subdivision housing project in this budget,” Prime Minister Davis said. “We have put in place measures to fund this project independently through the interest earned on the Mortgage Insurance Fund for additional housing infrastructure.”
He added: “We have also bought forward an amendment to the Central Bank Act which would allow use of unallocated interest from dormant accounts to fund home roof repairs. We are also continuing to support those who deliver critical aid to our communities, with funding for children’s homes, NGOs, and charitable organizations.
“In total, $29.6 million has been allocated for social assistance to ensure food, shelter, and basic needs for our most vulnerable.”
Prime Minister Davis announced that his Government was investing $4.5 million to support small and medium-sized businesses, with additional funding for the Small Business Development Centre.
“These investments are about creating jobs, building wealth, and empowering Bahamians to succeed,” he said.
Prime Minister Davis also pointed out that National Security remained a top priority.
“The Royal Bahamas Defence Force has been allocated $17.7 million for equipment and sea vessels and the development of the Coral Harbour and Inagua Bases,” he said. “We are also funding the acquisition of fire trucks and expanding our CCTV network to enhance public safety.”
“This budget is about one thing above all else: putting the Bahamian people first across all islands,” Prime Minister Davis added. “Our efforts to strengthen revenue are not just about balancing the books. It is to enable the Bahamian Government to strengthen its support for, and investment into, the Bahamian people.”
He noted that revenue was being reinvested into “improving lives, building communities, and developing our country”.
Prime Minister Davis said: “This should come as no surprise to anyone, as our choices and priorities across the public finances, reflect core PLP values. Our party was founded on the principles of social justice and equality.”
“Labour rights and fair wages, environmental stewardship and the empowerment of women and young people all sit at the heart of our mission,” he added. “And we have long-standing commitments to progressive economic policies, social protection and healthcare, and education for all.
“This budget reflects who we are, not just as a party, but as a people.”
