2012 Budget on 21 Nov.

Saturday, 8 October 2011 00:25 - - {{hitsCtrl.values.hits}}

By Uditha Jayasinghe

Despite being challenged with high levels of public spending, the Government has focused on a 6.2% Budget deficit for 2012, Cabinet Spokesman Keheliya Rambukwella said yesterday.

At the Cabinet press briefing, the Minister told media that the focus of the Budget continued to be development.

“In this process, priority has been given for the completion of ongoing development activities, before allocating resources for new projects. Budget estimates for 2012 are to be prepared with the aim of containing the budget deficit at 6.2 per cent of the GDP,” he said.

This is in order to ensure that economic development is maintained at 8% and the rate of annual inflation at 6% to 7%. Cabinet has given approval for the Appropriation Bill and will be presented in Parliament for its first reading on 18 October.

The total estimated expenditure for 2012 is to be Rs. 2,220 billion, necessitating an increase in Recurrent Expenditure from Rs. 1,029 billion in 2011 to Rs. 1,109 billion in 2012, and the Capital Expenditure from Rs. 938 billion to Rs. 1,111 billion. The total revenue will be Rs. 1,115 billion.

Public Investment has increased from Rs. 453 billion in 2011 to Rs. 541 billion in 2012 in order to maintain the momentum in the growth rate of 8%.

The Appropriation Bill for the financial year 2012 submitted by President Mahinda Rajapaksa, in his capacity as the Minister of Finance and Planning, was approved for presentation in Parliament, after publishing it in the Government Gazette.

Accordingly, the first reading of the Appropriation Bill will be on 18 October and the presentation of the Budget in Parliament will be on 21 November.

In the preparation of this Bill, the President and the General Treasury had consulted each line Ministry and other stakeholders, mainly with a view to formulating a realistic budget to divert resources for priority areas identified in the ‘Mahinda Chinthana’ and phased out in the Medium Term Expenditure Frame Work 2012-2014, the Cabinet paper said.