The importance of the 2019 Government Budget

Friday, 15 February 2019 00:00 -     - {{hitsCtrl.values.hits}}


Rural infrastructure needs investment

The tension between the SLFP and the UNP was largely triggered after the defeat of the UNP and the President’s SLFP faction at the Local Government polls last year, resulting in a blame game on the two sides. Thereafter no side made a real effort to boost economic growth, create more jobs, and add any new wealth to the stock market. 

Unemployment may be low, but hardworking Sri Lankans want to see an increase in their take home pay because of the tax reform enacted last year has reduced their purchasing power. They want the government to expand the tax net without landing more and more taxes on the converted. We need a great spirit of optimism to sweep across our nation. So that our young people can truly be confident that our brightest days are ahead of us. 

Therefore the 2019 Budget must rests on the following pillars of reform:

Ending wasteful spending

Sri Lanka is drowning under the highest level of debt held by the public. The current fiscal path is unsustainable, and future generations deserve better. The Budget needs to make the hard choices needed to stop wasteful spending, lower the national debt, and focus Government on what matters most to the majority of the people.

Create opportunity

That is more opportunity for affordable education and better-paying jobs. The Budget must take important steps to expand opportunities for the youth to access affordable, employment-relevant education that puts them on the path to better-paying job and, ultimately, a rewarding career. 

The Budget should promote formal apprenticeships that allow individuals to “earn while they learn.” The Budget also should make important investments in science, technology, engineering, and mathematics (STEM) education in schools, and supports career and technical education in schools and postsecondary institutions. 

Nation brand

The Budget must continue our efforts to grow the economy, create new jobs, and lower rates for productive investments. To accompany the effort to cut spending and implement decent tax cuts to families, workers, and businesses, we should continue to relentlessly target unnecessary regulation. 

The Budget also must redefine what is possible, by putting the economy on a path to long-term economic growth that will help strengthen our battered nation brand. This will then infuse the required additional dollars into our starved economy. 

Task cut out

Prime Minister Wickremesinghe recently said the Government has a duty to fulfil the responsibilities expected by the country on 8 January 2015. Therefore we now have to start a new journey. The PM added that the United National Party (UNP) also needs to undergo a complete change and that they need to bring new teams forward. The United National Front needs to be strengthened, he said, adding, that they would look to win the support of the majority of the country and move forward. 

Prime Minister Wickremesinghe now has his task cut out. Firstly, he needs to win the confidence of the Public. And secondly, he has to heal the cracks in the coalition. The Government position has been weakened by the rift at the highest levels of the current ruling coalition between the UNP and the President. 

Government reforms for Wickremesinghe is also now a must. He needs to re-energise the Government by injecting new blood into the veins of the Government and clean up his administration by getting rid of all the nonperforming and corrupt bureaucrats.

Way forward

Going forward many are now urging Wickremesinghe to implement proper economic policies. The Government needs to implement a transparent economic program unfettered so that they have an opportunity to go before the people with a less cluttered and confusing track record. 

The new tax structure implemented on 1 April also needs to be revisited and changed where possible. Taxes that hurt the poor needs to be revisited immediately. Many ministers in the current Government don’t really know what is going on in the villages. 

Rural infrastructure needs urgent repair in many districts, especially after two disasters last year. Therefore the Government certainly needs tone down its pro-Western and cosmopolitan outlook if it is to win the hearts of the rural poor.

In the final analysis, the Government should not let the 8 January 2015 victory to go waste; safeguarding and protecting that 8 January mandate is of utmost importance; its value cannot be overstated. That is why the 2019 Budget and the next eight months would be their last hope to stem Sri Lanka’s roller coaster ride.  This is certainly doable with a bit of common sense and strong leadership.

(The writer is a thought leader.)