Labour Government Stands Firm in Battle Against Inflation, Pledges Economic Relief

The government of St. Kitts and Nevis, under the leadership of Prime Minister Dr. Terrance Drew, is steadfast in its commitment to ease the economic strain on citizens amidst ongoing global inflationary pressures. In his 2025 Budget Address, Dr. Drew outlined measures that highlight his administration’s determination to protect the public from the rising cost of living while fostering stability and resilience.

Inflation Under Control

After years of fluctuating prices, inflation in the Federation has settled at a projected rate of 1.5 percent for 2024. This marks a return to normalcy, as global inflationary pressures begin to wane.

“The decline in inflation is primarily due to a reduction in average price increases for food and beverages, as well as stabilisation in the services sector,” Dr. Drew explained. However, some price increases in non-food commodities remain, attributed to imported inflation and external geopolitical tensions.

Sustained Relief Measures

The prime minister underscored the government’s unwavering efforts to cushion citizens against the harshest impacts of inflation. While initially planning to phase out COVID-19 relief measures, the Labour-led administration extended these programmes throughout 2024, recognising the persistent economic challenges faced by the population.

“Over the past year, we carried an extraordinary financial burden to shield our citizens from rising costs,” Dr. Drew said. “This investment in our people underscores our commitment to ensuring no one is left behind.”

Substantial Subsidies

Highlighting the scale of government intervention, Dr. Drew revealed that a remarkable $320 million has been allocated to essential subsidies and social programmes over the past two years.

• Electricity Support: $63.5 million was allocated to SKELEC, with $54.8 million specifically subsidising fuel variation charges to keep electricity affordable for households and businesses.
• Fuel and LPG Subsidies: The government provided $8.6 million in fuel subsidies at the pump and $12 million for liquefied petroleum gas (LPG), commonly used as cooking gas.

Strengthened Social Safety Nets

Beyond subsidies, the administration fortified social programmes to uplift vulnerable communities:

• $58.1 million supported initiatives such as the Livelihood Improvement for Family Transformation (LIFT) programme, food vouchers, and school meal schemes.
• $124.6 million was invested in the Skills Training Empowerment Programme (STEP), fostering employment and self-reliance.
• $39 million enhanced the ELEVATE programme, promoting inclusive development opportunities.

“These figures are not just numbers; they represent hope and stability for our citizens,” Dr. Drew stated. “Through these efforts, we have reaffirmed our pledge to create a brighter and more equitable future for all.”

Consumer Protection and Future Policy

The Consumer Affairs Department has been actively enforcing price control mechanisms to mitigate inflation’s impact on essential goods. Additionally, the government is undertaking a critical review of the Consumer Price Index (CPI), rebasing the basket of goods and services to reflect current market trends for the first time since 2010.

“This revision will ensure our policies are informed by accurate data and aligned with contemporary consumer spending patterns,” Dr. Drew explained.

On the issue of inflation Dr. Drew concluded by reaffirming his administration’s dedication to economic relief and resilience. “As we move forward, we will prioritise policies that safeguard purchasing power and ensure an acceptable standard of living for every citizen,” he said.

In a time of global uncertainty, the Drew-led administration’s decisive actions demonstrate a government committed to its people, paving the way for a sustainable, stable and prosperous future.