The Niue Government, which is struggling to keep the country financially viable, had been warned about dealing the phone company Q-Tel.
Q-Tel, which is based in the Isle of Man, owes Niue around three quarters of a million US dollars in unpaid fees.
It has been leasing the island's excess phone line capacity.
Q-Tel got the lease in 2000 ahead of APT which had had it for the previous five years.
In that time APT had paid five million US dollars to the Niue Government and provided sponsorship for sports teams.
The previous Premier Sani Lakatani supported Q-Tel ahead of APT because they offered a 125 thousand dollar licence fee, fifty thousand guaranteed monthly, and seven cents US a minute on each call.
That contract was agreed in Sept 2000, but the Government has not received any fees since November last year.
APT had publicly warned the Government that leasing the lines to a small, undercapitalised company with no international standing, threatened the country's economy.
Niue Telecoms director Richard Hipa says they are confident of getting the money from Q-Tel but Premier, Young Vivian, says they are preparing for a worst case scenario that they will not receive any of the money.
It has meant the Budget, due to be tabled today, has been delayed until Government departments can isolate savings of 20 percent.
This may mean wage cuts, shorter working weeks, charges for school books and buses, and possibly medical services.
