PB says 2015 Budget development-oriented, not “bag full of election goodies”

Saturday, 11 October 2014 00:29 - - {{hitsCtrl.values.hits}}

Reuters: Sri Lanka will not present the 2015 Budget with a “bag full of election goodies” when President Mahinda Rajapaksa presents it to Parliament this month, a Government official said on Thursday, amid speculation over an early poll next year. Rajapaksa, who is also the Finance Minister, will present the 2015 Budget on 24 October, targeting 8.2% economic growth and a fiscal deficit target of 4.4% of GDP.

The Government has advanced its presentation of the budget by two weeks and expects to complete it by 20 November, amid rumours of a presidential poll in January, in which Rajapaksa will be seeking a third six-year term. “Although there was reference made... that the 2015 Budget will a bag full of election goodies, I can assure you that it will be a development-oriented Budget that is in line with the direction set,” Finance Ministry Secretary P.B. Jayasundera told a forum in Colombo. “The fiscal deficit is being managed in a consistent direction towards 3% of the GDP in the medium term.” Jayasundera, the top technocrat and the treasury secretary in Rajapaksa’s administration, also said the Government will continue its infrastructure drive including ports, coal power plants, express highways, railways and urban development. “Creating a strong national budget and consolidating macro economy...requires having to raise Government revenue beyond 16% of the GDP,” he said. The $67 billion economy has seen over 6% average annual economic growth since Rajapaksa was elected for the first time in 2005 and the debt-to-GDP ratio fell to 78.3% last year from 90.6% in 2005. Annual inflation has been in single digits for more than five years through September. Monetary policy interest rates also have declined to multi-year low level under his administration. However, Rajapaksa’s opponents say the Government’s macroeconomic figures are manipulated to show a rosy picture. The Government has rejected the allegation. Many economists expect a raft of concessions ahead of an early presidential election, a measure used by successive governments to win the votes of the rural poor. On Thursday, Rajapaksa ordered a cut in the price LP gas, three weeks after he cut electricity and fuel prices.