KUWAIT CITY, Nov 9: The Audit Bureau (AB) has called on the government to impose new taxes to increase the non-oil revenues by amending the tax laws to reform the state’s tax system saying an increase in non-oil revenues is the only way to remedy the budget deficit in light of the declining oil prices.
The Bureau has a set of recommendations to protect public money and address the budget deficit.
1. Changing the fees structure for utilities and public services.
2. Addressing the decline in capital expenditure and also the delay in the implementation of capital and construction projects; limiting the causes of delay in approving the general budget so the government agencies are able to prepare for projects; finding solutions to the administrative obstacles related to implementation and restructuring the documentary cycle
The report said 33 percent of the capital expenditure in the budget for fiscal 2016-2017 which is approximately KD 1.15 billion was not spent for government projects and for all government agencies it was KD 3.4 billion.
The Bureau said the weak performance of the government was due to absence of clear cut plan for follow-up and implementation and internal control which negatively affected the economic growth of the country and was responsible for the continued budget deficit.
3. Addressing the deficiencies in the internal control systems, establishing and activating the administrative dependency for inspection and internal audit offices in government agencies, which helps to reduce the negative impact on the protection of public money.
4. The need to stop the inflation by not registering outstanding sums of money owed to government agencies as ‘under collection’ because this money is about KD 2.3 billion for fiscal 2016/2017.
5. Stop infringements on State property and activate the role of regulatory bodies to follow up the exploitation in this area which is done in improper manner and lead to the loss of public money.
6. Restructuring the mechanism of implementation of contractual terms with government agencies, which deprives the state of millions of dinars as a result of non-follow-up and impose fines for delay and poor implementation. The Bureau has fined the contractors KD 53 million, while millions have been lost due to lack of proper contractual conditions.
7. Unjustly disbursing employees’ salaries, allowances, and bonuses to many government entities subject to debt control because the Bureau noticed KD 44.2 million were unjustly paid during the previous fiscal year. The Audit Bureau said in its annual report, commenting on the final statement that the budget deficit of the State for fiscal year 2016/2017 was KD 6 billion but was fully covered by withdrawing money from the general reserve.
The state revenues in the final statement for the previous fiscal were KD 13 billion, while expenditure was KD 17.7 billion with a deficit of KD 4.6 billion. The addition of the reserves of future generations was KD 1.3 billion and the deficit in the state budget in the final statement was KD 6 billion.
By Abubakar A. Ibrahim Arab Times Staff