The stage is set to present the interim budget 2022 of the present administration headed by President Ranil Wickremasinghe in parliament next month as the initial step of resetting the governing system, Finance Ministry sources confirmed.
An Amendment Bill to the Appropriation Act 2022 has now been devised and the Legal Draftsman is now drafting this relevant bill using the inputs of the Ministry of Finance.
Under the previous Appropriation Act for 2022, the total expenditure estimated for 2022 was around Rs. 4 trillion, a slight drop of around Rs. 30 billion from the approved allocations for 2021
The estimated expenditure in the Interim budget for the last four months will be Rs 1. 21 trillion The Government does not have sufficient inflows to the Treasury to pay even the salaries of the bloated public service, according to the Prime Minister and Minister of Finance.
He, therefore, wants the Central Bank to lend him Rs. 1 trillion over the next six-month period. Already the Central Bank has accommodated the Government’s funding requirements up to Rs. 2.2 trillion.
Though this is a huge expansion of the reserve money base, the Central Bank has been saved on the domestic side by the outflow of funds from the country due to its having a net negative position in foreign reserves.
As such, the reserve money base has increased marginally from Rs. 932 billion at end-2019 to Rs. 1,454 billion as at the first week of July 2022.and the revenue Rs 634 billion, provisional data shows.
Economic Stabilisation Committee Head and former Treasury Secretary Dr. R.H.S. Samaratunga said the pre-2019 tax structure would be re-introduced with the aim of increasing government revenue.
The Interim budget basically aimed at providing relief for the low income families and vulnerable community will lay the foundation for the country’s economy, allowing it to stabilise and recover within a short period.
It will allocate considerable financial facilities for essential public services and relief for the poorest of the poor establishing asocial security net for their survival.
The pension payment of retirees will be increased to Rs. 255 billion or Rs 270 billion from Rs 210 billion while increasing Samurdhi relief to around Rs 350 billion from Rs100 billion at present under interim budget proposal of the President, senior Finance Ministry official said
It has also proposed to allocate Rs. 200 billion as incentives to low- income families as well as the Small and Medium sector.
Agricultural loans to farmers who have land below two hectares will be written off he said adding that the ownership of state urban housing units will be given to occupants who are now residing in these housing units on monthly rent.
