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67% forecast for budget deficit for fiscal ’21/’22
KUWAIT CITY, April 3: According to a document issued by the Ministry of Finance the positive expectations of a decrease in the budget deficit were stimulated by the improvement in oil prices over the past few months, reports Al-Anba daily. The forecast for the budget deficit for fiscal 2021/2022 is 67% worth more than 8 billion dinars, and the expected deficit becomes at the level of 4 billion dinars instead of 12.1 billion dinars budgeted ability. The official data indicates Kuwait achieved an increase in its oil revenues during only 11 months of the year.
The financial statement increased by 56 percent, exceeding 5 billion dinars, to obtain actual oil revenues during the period from April to the end of last February, amounting to 14.26 billion dinars, compared to 9.1 billion dinars that was expected to be collected for the whole year. In addition, other documents showed that the budget is facing an old challenge that has been renewed in light of the successive changes, which is the increase in spending at the expense of local current assets which is something that the Ministry of Finance realized and proceeded to address by employing savings in all the financial appropriations available in the state to settle those accounts, while maintaining the maximum approved spending for the whole year and not exceeding it.
The sources indicated that the accounts rose in value again, driven by requirements related to the general interest of the country and citizens, including economic or political matters, not to mention emergency expenses that were not included in the estimates of financial appropriations for ministries and government departments, which the government cannot postpone due to its inevitability.
The sources stated that the Ministry of Finance resorted, in parallel, to legal and regulatory measures aimed at addressing these accounts, by submitting the government a draft law to the National Assembly stating that “The Minister of Finance may transfer from the amount of savings by approving one of the expenditure sections to another section of the budget between the ministries and government departments, as well as transfer from the amount of savings in approving the same chapter between ministries and government departments, if urgent considerations arise that necessitate this, provided that this does not result in an increase in the total appropriations contained in the budget link law.
According to the new draft law, which is only for the current fiscal (2021/2022), the Ministry of Finance can address the increase in the balances of the trust account by making transfers of savings between budget chapters and government agencies and some of them, instead of limiting them in the past to savings between items and types within each chapter of the Budget sections only.
Article 146 of the Constitution stipulates that every expenditure that is not included in the budget or in excess of the estimates contained therein must be made by law, as well as the transfer of any amount from one chapter of the budget to another. “Finance” based on its required law on Decree-Law No. 31 of 1978 regarding the rules for preparing general budgets and controlling their implementation, the final account and the laws amending it, while the text of Article 22 of this law includes “No party may exceed a specific appropriation for any expenditure, and it is legal to transfer from the potential savings in accrediting another bank from the same chapter and section, and the Minister of Finance shall determine the terms and conditions of the transfer.”