GREAT BAY--St. Maarten ended the first half of 2026 with XCG 141 million in payment arrears, faces a projected decline in freely available operating funds to just XCG 5 million by the end of the year, and had spent only XCG 4 million of the XCG 165 million budgeted for government investments. These are among the findings highlighted by the College financieel toezicht Curaçao and St. Maarten (Cft) in its latest assessment of the country's public finances.
In a letter dated November 11, 2026, addressed to Minister of Finance Marinka Gumbs, the financial supervisory body identifies significant weaknesses in financial management, delays in executing government investments, incomplete financial reporting and substantial risks associated with government-owned companies and healthcare funds.
The Cft also reports that St. Maarten submitted its second-quarter financial execution report more than ten weeks after the statutory deadline, continued using the 2025 budget to measure its 2026 financial performance, and has failed to provide several years of required financial information concerning the wider public sector.
Despite reporting a provisional XCG 46 million surplus for the first six months of 2026, the Cft cautions that the reliability and usefulness of the government's financial reporting remain limited.
XCG 141 million in outstanding payments, only XCG 5 million in projected liquidity
One of the most significant concerns is the government's outstanding payment obligations, which stood at XCG 141 million at the end of June 2026.
The Cft has instructed the Minister of Finance to actively manage the country's financial position, improve liquidity and reduce payment arrears.
Compounding this concern is the projection that freely available liquidity for ordinary government operations will amount to only XCG 5 million at the end of 2026.
The supervisory body warns that such a limited financial buffer reduces the government's ability to absorb unexpected financial setbacks and meet its payment obligations on time.
The combination of substantial outstanding payments and limited projected liquidity presents an important challenge for the management of public finances, even as government reports a provisional surplus on its ordinary budget.
Only XCG 4 million spent on XCG 165 million investment budget
The Cft's assessment also highlights the limited execution of government investments during the first six months of 2026.
According to the figures presented, St. Maarten budgeted XCG 187 million for its capital account in 2026, including XCG 165 million for government investments.
However, by the end of June, only XCG 12 million in total capital expenditure had been recorded. Of that amount, XCG 6 million went toward loan repayments, XCG 2 million toward student loans and just XCG 4 million toward government investments.
This means approximately 2.4 percent of the XCG 165 million investment budget had been spent during the first half of the year.
The figure raises questions about the pace at which budgeted investments are being translated into actual project expenditures.
The Cft says the government's reporting does not provide sufficient information to assess the progress of individual investment projects.
It also identifies inconsistencies in the capital account, including information carried over from the 2025 budget that no longer reflects the current financial year.
The supervisory body wants the government to provide an updated overview identifying the amounts budgeted for each investment project, expenditures already incurred, financial commitments entered into, remaining implementation schedules and any delays.
The report also draws attention to XCG 14 million budgeted for the Mental Health Foundation, noting that previous reporting indicated that the relevant reservation had already been spent in 2025. The Cft wants the capital account updated to clarify such discrepancies.
Government companies pose major financial risks
The Cft identifies GEBE, TELEM and the Postal Services St. Maarten (PSS) as government-owned entities presenting significant financial risks.
According to the report, the government itself identifies these three companies as having the highest risks among its entities.
For GEBE, the most recent available audited financial statements relate to 2024.
Those statements show that the utility company's profit declined from XCG 18 million in 2023 to XCG 2 million in 2024.
The Cft further reports that GEBE's receivables and other claims increased to XCG 11 million, with uncertainty surrounding whether those amounts can be collected.
TELEM is also experiencing financial difficulties, particularly in meeting obligations to its lenders.
The telecommunications company has requested a government guarantee of XCG 5 million. According to the report, the government has not approved that request.
The situation at PSS is described as concerning because the postal company has negative equity and remains dependent on government support to continue operating.
The Cft indicates that current financial information concerning PSS is unavailable, limiting the ability to assess its financial position.
Beyond these companies, the supervisory body expresses concern about financial risks associated with Social and Health Insurances (SZV), including the potential consequences for the national budget.
It says the government has not sufficiently quantified the risks involving SZV and government-owned companies or explained the measures needed to manage their potential impact on public finances.
The Cft considers it essential that these financial exposures be calculated, their possible budgetary consequences identified and concrete corrective measures established.
Government more than ten weeks late with financial report
The Cft also raises concerns about the government's compliance with financial reporting obligations.
Under the Kingdom Financial Supervision Act, St. Maarten was required to submit its second-quarter financial execution report by August 11, 2026.
However, the Cft did not receive the report until October 28, more than ten weeks after the statutory deadline.
The supervisory body points out that the 2026 budget had also not been formally adopted during the first half of the year.
These delays limited the government's ability to manage spending and make timely adjustments to financial policy.
The report additionally reveals that the government continued comparing its 2026 financial results with the approved 2025 budget, even though the 2026 budget had subsequently been adopted.
The Cft therefore conducted its own comparison using the approved 2026 figures.
It also observes that the government's updated financial forecast for the remainder of the year was presented without sufficient supporting explanations.
The Cft has requested that the third-quarter report use the correct budget figures, explain significant deviations and provide proper justification for projected year-end results.
Missing financial reports prevent full assessment of public debt obligations
Another concern involves St. Maarten's failure to formally establish and report on the collective public sector in accordance with its legal obligations.
The Cft states that the collective sector for 2024 and 2025 remains unestablished, while the required determination for 2026 and 2027 has also not been completed.
Despite repeated requests, the supervisory body has not received the collective sector reports covering 2021 through 2024.
The absence of these reports means the Cft cannot determine whether St. Maarten is complying with the statutory interest expenditure standard.
The Cft also does not possess the latest financial statements for all relevant government entities.
Although it understands that steps are being taken to address these deficiencies, the supervisory body is calling for the outstanding information to be submitted and the collective sector to be formally established.
XCG 46 million surplus does not eliminate concerns
While identifying these financial management problems, the Cft acknowledges that St. Maarten recorded a provisional surplus of XCG 46 million on its ordinary budget during the first six months of 2026.
Government revenue totaled XCG 323 million, representing 50 percent of the annual budgeted revenue of XCG 647 million.
Expenditure reached XCG 277 million, equivalent to 43 percent of the XCG 637 million annual expenditure budget.
Both revenue and expenditure increased by XCG 11 million compared with the corresponding period in 2025.
Personnel expenditure accounted for a substantial portion of the increase, rising from XCG 113 million to XCG 122 million.
According to the report, this reflects the filling of vacancies, periodic salary increases, overtime payments and higher healthcare-related costs for civil servants. Overtime expenditures remain above budget.
Although tax revenue appears to have increased significantly, the Cft explains that part of the increase results from revenue being reassigned from miscellaneous income to the appropriate tax categories rather than entirely from new collections.
The government expects to close 2026 with a surplus of XCG 11 million, compared with the XCG 10 million surplus included in the approved budget.
The Cft concludes that St. Maarten provisionally meets the central budget balance requirement and the legally required compensation of previous deficits.
However, the assessment is subject to uncertainty because parts of the budget do not fully satisfy the requirements for a complete, orderly and verifiable financial administration. Final compliance can only be established with greater certainty following the annual financial statements and the auditor's assessment.
Cft recommends corrective action
In its recommendations, the Cft calls on Minister Gumbs to improve the quality of financial reporting, actively manage the investment agenda, strengthen the government's liquidity position and reduce outstanding payment arrears.
It also wants an updated and detailed capital expenditure overview, including explanations for delayed investments and deviations from approved budgets.
The government must further establish the collective sector, submit the missing financial information and provide a clearer assessment of the financial risks associated with its companies and healthcare funds.
The November 11 assessment underscores that St. Maarten's provisional budget surplus exists alongside unresolved payment arrears, limited liquidity, low investment execution and gaps in financial accountability.
The Cft's findings place particular emphasis on whether the government can improve the management and execution of its finances while maintaining sufficient resources to meet existing and future obligations.
