By Jumana Ghunaimat

The Budget Says it All… (2/2)

In a previous article, based on the information listed in the recently proposed Central and Independent Government Units 2017 budget bills, it seems the government has already planned to increase expenditures in total disregard of the necessity to reform and address our financial situation; the bills do not address the long endured financial discourses and practices of consecutive government which have for years drained our resources.

Apparently, Jordan is an extremely wealthy state, with endless resource and fortunes beyond count, or at least that’s what our government thinks!

An overall expenditure of JOD11 billion, now, for a country in our financial situation, would only mean further indebtedness, more culminating deficits, weighing an already weary economy down for decades to come.

More so, these expansions in expenditures were not pillared by healthy growth in revenue; contrarily, at a time when foreign aid has retracted 1.6 per cent to JOD777 million for the year 2017, instead of 2016’s JOD814 million, coupled with a similar recession in non-tax state revenues, the government somehow saw it wise to increase spending, somehow expecting to cover parts of gapping deficit by increasing domestic revenues by JOD567 million, which only means that citizens; the consumer, is expected to chip in through a variety of difficult measures to be decided over the coming year!

Obviously, from the fact that this kind of expansive bill was audaciously proposed, our government is completely unaware of the scale of our economic predicament, or of the sensitive percussions of increased expenditures and uncontrolled waste in the public budget. That is besides the fact that the sections increased do not contribute to economic growth, which is the least to be expected.

In bulk, the absolute figure of capital expenditure in the 2017 budget bills seem humongous, at roughly JOD1.3 billion. However, the devil in the details of this particular section shows most of the expansions are allocated to undergoing or concluded projects, with only JOD305 million allocated to new projects. That does not suffice the attainment of the targeted 3.3 per cent growth in GDP!

Generally, most of the expansion was allocated to the central government budget bill, from JOD8.49 billion in 2016 to JOD8.94 billion in 2017; nearly JOD451 million, or 5.3 per cent. And typically, most of this raise was assigned to increases in current spending, around JOD200 million; from 2016’s JOD7.3 billion to a proposed JOD7.5 billion.

O’, and what a devil it is that lies in these details; the budget says it all!

These bills proposed expose to us, first and foremost, that the government is not at all serious about “reformation”, except for the sections and details that have to do with expenditures on services extended to the citizenry. And as a reminder, the government also said that as of next year, subsidies allocated to electricity will be suspended. A decision has already been made tying price tariffs to the global oil market, via an equation which simply speaking says that the higher above USD55 per barrel the cost of oil goes, the higher the electricity bill for citizens is going to be!

Additionally, the budgets show that taxation is also due to increase. And while that may be based on the “undisclosed” study the government is so keen on withholding, everything notwithstanding, shows that all the difficult decisions Jordanians have had to put up with and endure over the years were just all to waste; it did not reflect on their country’s public balance sheet or budgets.

The 2017 budget bills proposed stand concrete proof that all the recommendations and programmes of the International Monetary Fund (IMF) have taken us not a single actual step closer to financial reformation.

Sequentially, given the standing regional condition, it will be extremely difficult for the government to achieve their goals; because the real crisis is mainly a composite of domestic, popular distrust, and a regional wildfire that does not omen to burn out by 2017.

Yesterday, the House of Representatives referred the bills to the Parliamentary Financial Committee. Still, based on extensive expertise and the capacities of the House by the law and constitution, all the committee can do is to lower and rectify expenditure, given that continued expansions in spending is nothing but a long endured financial illness that should be addressed or contained, at least.

Powered by: joos.co
© جميع حقوق النشر محفوظة لجريدة الغد 2018