WILLEMSTAD – The increase in government spending in Curaçao is being driven increasingly by rising personnel costs, particularly in 2026. This emerges from the First Supplementary Budget for 2025 and the explanatory notes to the 2026 Budget, which show that wage developments, indexation, higher vacation allowances, and the expansion of staffing levels are structurally affecting nearly all ministries and state bodies.
In 2025, wage developments are dominated by the so-called Bashi bonus. In the supplementary budget, the government is asking Parliament to approve expenditures that have already been made, including this one-off payment to civil servants and equivalent employees.
According to the government, the financial room for this payment was already included in the 2025 budget through a general provision. The budget amendment mainly concerns a technical reallocation of funds to the correct cost centers. The government links the Bashi bonus to the former end-of-year bonus tradition, which was paid annually before the COVID-19 crisis when liquidity allowed.
From Incidental to Structural
As a result, the debate on personnel costs in 2025 still has a largely incidental character. The payment reflects a political choice to compensate employees after years of austerity and wage restraint. Structural wage increases play only a limited role in the 2025 documents and remain largely in the background.
That picture changes dramatically in the 2026 Budget. Personnel costs are no longer presented as incidental rewards, but as a structural expenditure item that appears across almost every chapter of the budget.
For 2026, the government incorporates the ongoing effects of salary indexation, step increases, a general rise in vacation allowance from six to eight percent, and the continued filling of vacant positions. These costs are no longer absorbed centrally, but are spread across the individual budgets of ministries and services.
A Recurring Pattern
In the budget explanations, the same pattern repeatedly emerges. Increases within ministerial departments, executive agencies, security services, and advisory bodies are almost invariably attributed to higher personnel costs.
In many cases, this reflects a combination of wage indexation, statutory step increases, higher vacation pay, and expanded staffing levels. This not only raises the wage cost per employee but also increases the total number of funded positions within the public sector.
The Bashi bonus itself also takes on a different position in 2026. While in 2025 it is addressed through a supplementary budget, in 2026 it is incorporated—together with indexation and salary steps—into the central provision for personnel compensation. As a result, the bonus loses its exceptional character and becomes part of regular wage policy.
Broader Budgetary Impact
The impact of rising wages extends beyond direct salary expenses. Pension contributions and social security costs rise automatically along with the growing wage bill, leading to higher expenditures across multiple budget layers without additional policy decisions.
The contrast between the two years is therefore clear. In 2025, the discussion around personnel costs mainly centers on a one-off payment and the political justification for it. In 2026, wage growth has evolved into a structural budgetary factor shaping the government’s overall expenditure pattern.
What was once a temporary measure has effectively become a permanent element of Curaçao’s fiscal policy.