KUWAIT CITY, May 17: The parliamentary Budgets and Final Accounts Committee discussed Wednesday the joint budget of Kuwait Petroleum Corporation (KPC) and its subsidiaries for fiscal 2017/2018, as well as the final account for fiscal 2015/2016 and comments of the State Audit Bureau and Financial Controllers Agency. Committee Chairman MP Adnan Abdul-Samad disclosed the estimated net profit of KPC in its budget for the new fiscal year is about KD 544 million which is 47 percent higher than that of the previous year.
He explained this is based on the expected revenues with oil price of $45 per barrel that will contribute to higher estimate of crude oil sales — more than KD 10 billion. He pointed out the committee still believes the net profit of KPC comes from non-operational income more than the operational because the former is the result of interests, investment income and others estimated at about KD 939 million; while some operational activities of companies affiliated to KPC have been incurring annual losses. He cited as an example Kuwait National Oil Company’s refinery losses which increased to KD 405 million in the budget for the new fiscal year.
He stressed the need to take decisive steps to address the problem, considering the KPC budget is a combination of the results of the work of its subsidiaries. He went on to say that despite the reduction in the number of oil development projects from 70 to 38 with an estimated total cost of KD 18 billion, or KD 5 billion.
He emphasized the need to find plausible solutions, taking into consideration the observations on the delayed implementation of oil projects by KPC and its affiliated companies. He revealed the last State Audit Bureau report submitted to the committee revealed that 144 out of 291 observations were about oil sector contracts and projects, as majority of them touched on loopholes in oil sector contracts and lack of financial conformity. He said the committee is contemplating on the possibility of holding a special session to discuss these observations in the Parliament as a separate issue, as it happened in the previous two years when they discussed observations of the bureau on various government agencies. For instance, the actual completion rate of the environmental fuel project was 50 percent in the last final account, while the target was 61 percent.
The number of workers involved in the project did not exceed 17,000 whereas the plan was 40,000, he asserted. He added the committee stressed the need for KPC and its affiliates to intensify their efforts in achieving the vision to increase production to four million barrels by 2020, especially since the difference between the target and actual production is estimated at 810,000 barrels according to the final account and budget of KPC and its subsidiaries which the committee discussed this year.
He affirmed the realization of this vision is necessary, particularly since the environmental fuel and Al-Zour refinery projects are expected to enter the operational phase in the next few years.
In order to ensure highly efficient operations, they will be provided with 46 percent of the current production of Kuwait Oil Company (KOC) — three million barrels — until the last final account, he clarified. He disclosed the committee also underscored the need to fill vacant posts in KPC and its subsidiaries — a total of 3,578 jobs; as well as the importance of re-examining reduction of personal interview percentage in the promotion criteria, currently 55 percent, to avoid mistakes.
Meanwhile, MP Yousif Al-Fadalah has submitted questions to State Minister for Cabinet Affairs Sheikh Mohammad Al-Abdullah about the expatriate consultants in the Civil Service Commission (CSC). Al-Fadalah wants to know the number of expatriate consultants in the CSC, their nationalities, terms of service and salaries.
He also asked if these consultants provide advice to other government agencies. If yes, he wants to know the number of these consultants and whether they are receiving additional pay or not. He inquired as well about the number of expatriate consultants in other government agencies that also work for other public institutions, their nationalities, salaries and additional pay for working in other institutions, if any. In another development, MP Osama Al-Shahen has emphasized the need to replace expatriate teachers with Kuwaitis as a way to address the population imbalance issue, reports Al-Rai daily.
He urged the government to be committed to the population structure file in academic institutions, asserting this is important considering the reality shown by statistical reports on expatriate teachers. Supporting his recommendation with data, the lawmaker disclosed the statistics released by the Central Statistic Bureau in April 2017 indicated there are 3,064,193 expatriates in the country and they constitute 69.5 percent of the entire population.
He added the country has 71,014 teachers and 46,079 of whom are Kuwaitis; indicating 24,935 are Arabs and other nationalities. Talking about figures in relation to expatriate students who are studying for free in Kuwaiti academic institutions, the lawmaker called for reducing their number. He believes the government can save a large amount by reducing the number of foreign students in public schools. He said, “the average amount spent on a student in a public school is KD 4,973 annually.
Considering there are 51,378 expatriate students in public schools, the government is spending KD 253,653,186 on non-Kuwaiti students.” He pointed out that expatriate students cannot enroll in public schools unless they fall under one of the categories which have been given consideration by the State. He added, “the problem is there are more than 16 categories and the number keeps increasing.
For instance, the students born to Kuwaiti and GCC nationals married to non-Kuwaitis, those whose mothers or fathers are diplomats, those born to non-Kuwaiti prisoners of wars and martyrs, those whose parents are from crisis-ridden countries, and those whose parents are university staff, imams and muezzins. We should consider humanitarian cases only and remove others or ask them to pay reasonable fees. Such solutions will help reduce expenditures on students and improve the budgets of schools.
The lopsided population structure is a serious problem and all of us, including the government, must work together to solve it because the large number of foreigners staying in the country has negative impacts on security, economy and society as a whole.” He also urged the government to prioritize allocation of a quarter of a billion dinars (KD 250 million) annually with almost 51,000 seats for students and 25,000 teaching appointments. He affirmed this will also solve the population imbalance problem.
By Abubakar A. Ibrahim Arab Times Staff and Agencies