10 pct deduction said done
KUWAIT CITY, Sept 4: The State Budget for the current fiscal (2019/2020) has recorded a deficit of 1.1 billion dinars for the period from April 1 to June 30 last, reports Al-Rai daily quoting informed sources.
The sources pointed out that this deficit comes after deducting the 10 percent which is due to be transferred to the Future Generations Fund. According to the draft budget for (2019/2020), the deficit achieved by the state budget during the first quarter of this year, represents about 14 percent of the total value of the expected deficit for the whole year, which is estimated at 7.7 billion dinars, after deducting the share of future generations. In simple terms, if we distribute the estimated deficit for the whole year over four (quarterly) periods, it is expected that the deficit rate during the first three months (first quarter) was about 1.9 billion dinars, which means that the deficit in the budget declined during the first quarter of the year by 42 percent, reaching 1.1 billion dinars, a decrease of about 800 million dinars.
The sources pointed out that the prices of oil, which traded over the last period (the data) at a value higher than the estimated price in the budget, supported the decline in the deficit rate during the first quarter of this year, despite the Ministry of Finance raising the price of a barrel of oil during the current fiscal year by 20 percent to $55 a barrel, compared with $50 in the previous fiscal year (2018/2019).
The State’s final account for the fiscal year (2018/2019), showed a deficit of 3.3 billion dinars, after deducting the reserve ratio of future generations, a decrease of 31 percent, compared to the final account for the previous fiscal year, as well as a decline 63.6 percent of the budget estimates for the fiscal year ended March 31, 2019, while it recorded a deficit of 1.29 billion dinars before deducting the reserve ratio of future generations, where the amount of deduction exceeded 2 billion dinars.
The actual deficit saw a positive change supported by the average price of a barrel of oil for the fiscal year (2018/2019), which witnessed an increase of 37 percent, recording $68.62 as the actual average in the final account, compared with $50 per barrel estimated in the budget.