K16.2 billion 2015 budget

Caption: Treasurer Patrick Pruaitch delivering his speech at the budget lockup yesterday. Sitting in front are Treasury Secretary Dairi Vele (L) and Finance Secretary Dr ken Ngangan.

By MATTHEW VARI

Wednesday, November 19, 2014 (Midweek Chronicle, PNG)

THE National Government unveiled, for the second successive year, another record budget for the 2015 year of K16.2 billion, from last year’s figure of K15.1 billion.

The national government has increased the money plan for the year ahead by 7 percent (additional K1.1 billion) from the corresponding year.

Presenting the figures at the Budget Press Lockup at the National Parliament State Function Room- Treasury Secretary Dairi Vere highlighted the government’s focus for the 2015 spending year under the theme of ‘Building our Nation and Providing Opportunities for our People’.

The third deficit budget in a row, total revenue is estimated to stand at K13.9 billion- against the K16.2 billion figure, for a deficit of K2.2 billion (4.4 percent of the Gross Domestic Product)- with the public debt to GDP standing at 28 percent in 2015.

In addition to the budget in 2015, the Supplementary budget for the rest of the year will see a reappropriation of low priority expenditures to the Pacific Games and key infrastructure projects.

The priorities of the budget focus on macroeconomic stability, effective implementation of projects, increased direct funding to provinces and districts, support policy priorities in (education, health, infrastructure, agriculture and SME sectors), and also strengthen the law and justice sector.

Secretary Vere said that despite prediction about the economy growth to hit 21 percent in 2015- the current prediction is rather at 15.5 percent, however, the growth against other economies in the region in 2015 is predicted to be the high despite the readjustment.

“This is the 14th year of consecutive growth, and I say in real terms of about 7 to 8 percent growth,” Secretary Vere said.

“Look at where we are in terms of the country and the region and see that Fiji, South Korea, Indonesia, Australia, Timor-Leste, and Philippines- even though we are not going to hit the 21.2 percent growth mark, where we are at is leading in the region and arguably in the world also.”

“Where the government is looking at now is that we are building our country and therefore provide opportunities for our people.”

Secretary Vere explained that the contribution to growth over the years was more balanced in terms of the mining and construction and other sectors.

“The reality is that we are really a part of that energy club, because in 2015 the main drive of our growth is going to be oil and gas,” he said.

“So the challenge for us as the Vulupindi team (Finance, Treasury, Planning) is to make sure that the gains made in the resource sector are then passed off to the other sectors so that we do have a more inclusive growth.”

“Also it is vital to have a broad based growth, where we must not rely one only one particular sector, because when that sector falls for whatever reason it may really affect the economy as a whole.”

The sector expenditure breakup will see Administration spend K2.5 billion, Debt Servicing at K1.1 billion, Economic Sector K730 million, Education K1.9 billion, Health K1.8 billion, Infrastructure K2.7 billion, Law and Order K1.6 billion, Provinces Electorates and LLGs K3.7 billion, Social services K139 million.

There have been increases in Provincial and LLGs, Education, Health, and Law and Order in support of critical government priorities.