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Budget deficit … it doesn’t concern you if your uncle’s money is wasted

Ahmed Al-Jarallah Editor-in-Chief, the Arab Times

THE talk about financial deficit in Kuwait has been ongoing for several years. Many local institutions have released reports concerning this issue. Nevertheless, the recommendations and solutions never saw light. At the same time, reports from international financial institutions reflected local projections. Despite this, the issue should be revisited, or at least the reasons for the financial deficit, which is more of a paper thing than a reality, must be determined.

Irrespective of what the truth is, the subject laid down by the Minister of Finance and Acting Minister of State for Economic Affairs Maryam Al-Aqeel for discussion is that the 2020/2021 budget will record the highest deficit in the history of Kuwait, reaching up to KD 9 billion, as announced by the minister. Several question marks have been raised concerning the fiscal policy, which does not consider the country’s needs in scientific ways but is based on wastage and squandering that makes the deficit, if any, to be as massive as an iceberg.

It will one day transform into a real deficit, pushing the country into the club of debtors and putting many of her decisions under the grip of the creditors. With reference to this fact, is it possible to get rid of the “paper deficit” through drastic change in the financial wastage, considering that beneficiaries who supervise expenditures are of the mindset that changes the popular adage “Don’t steal, Don’t fear” to “Steal without fear”? Kuwait is the only country in the world that allocates a huge budget to the health sector compared to the population, which is about KD 1 billion.

It is relatively the highest in the world in terms of the number of overseas medical treatment cases. Compared to the allotted budget in this regard, the health infrastructure in Kuwait should reasonably be the most advanced globally. But, where is the problem? The tourism treatment is approved as bribery for elections. Several thousands of people who go for overseas medical treatment in summer are candidates of lawmakers. This means a part of their electoral campaigns are funded with that clause. This is in addition to illegitimate appointments and transactions the ministers approve for them, especially tenders, which is another breast of the milky wastage cow. In the GCC countries, as well as in the West and other advanced countries, there is no clause for overseas medical treatment.

Those who seek treatment overseas must spend their own money, and the country insures medical care through the private sector and mandatory health insurance for citizens. The government supervises execution of the health policies, as well as the public hospitals and health centers. As for housing, it is a disaster.

The housing policy stands on erroneous philosophy that is outdated, both in terms of specifications for government houses after it has been converted into a source of favoritism, and the distribution of lands that increases the rate of wastage.

It also includes haphazard planning and execution without abiding by the physical planning of the areas. Political and electoral benefits play a vital role in this aspect too. In Saudi Arabia, the United Arab Emirates, Oman, Qatar and Bahrain, the policy of entrusting the private sector with the building of such houses has been done.

It is in charge of building and selling to the beneficiaries, while the state provides the land and infrastructure, and pays interests to the banks that finance the projects. This has resulted in a drastic solution in that regard. However, in Kuwait, the waiting period is up to 15 or even 17 years.

The government wastes public funds in millions every year on housing allowance for employees – funds that could have been spent on infrastructure for necessary solutions. The government will spend several billions in the new budget on subsidy, which has become a real burden on the public funds.

It is providing free food items at a time when citizens pay electricity bills in neighboring countries without requesting for any cancellation of bills or consumer debt forgiveness – which the lawmakers and candidates use as a slogan in political campaigns.

By Ahmed Al-Jarallah
Editor-in-Chief, the Arab Times

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