Financial status report is sought

PARLIAMENT is seeking a financial outline on the government’s spending within six months to detail the implications of the Covid-19 pandemic.

Its financial and economic committee has requested for a financial status report to be submitted ahead of the new national budget for 2021-2022.

The new budget is expected to be submitted to the National Assembly in October, but MPs wants to study a proper financial roadmap in order to postpone or cancel some projects.

The Cabinet announced last week that it will slash the operational budgets of ministries and government departments by 30 per cent.

A number of construction and consulting projects will also be rescheduled to absorb emergency and emerging expenses to combat the spread of the coronavirus within the ceiling of the 2020 national budget.

“Bahrain’s economy is affected but not fully hit by the global implications of Covid-19, but we need an outline on what is taking place now, what is expected next and what are the arrangements,” said Parliament’s financial and economic affairs committee chairman Ahmed Al Saloom.

“Measures are in place to balance records, but there are losses and we want to have a comprehensive plan before the new budget is submitted.”

MP Al Saloom, who is also board member of the Bahrain Chamber of Commerce and Industry, said it was necessary to ensure the fiscal balance programme is met by 2022, even if it means slashing major projects and spending.

The government has been on a fiscal balancing programme to ensure spending and income are on an equilibrium with the $10 billion aid from Saudi Arabia, Kuwait and the UAE.

The $10bn GCC Development Fund set since 2011 for development projects is expected to finish by the end of next year.

“We need to know if the fiscal balance programme will be met by 2022 and if there are necessary changes that legislators will need to take,” he said.

“This has to be done no matter how hard the decisions may be, but without affecting the financial support schemes and wages of citizens set under the government’s commitment in the four-year Government Action Plan.

“Based on early indicators, progress on infrastructure from the GCC Development Fund is going on as planned and will continue until set targets are reached even when financing stops next year because by then Bahrain’s future foundation would be ready.

“It is also worth noting that the government is allocating millions of dinars towards projects from its own revenues every year, and that topic is of concern as we want to ensure this allocation is trimmed for the time being.”

Reschedule

Parliament’s public utilities and environment Affairs committee vice-chairman Ahmed Al Demistani also reiterated that the government will most likely have to reschedule or cancel a number of infrastructure projects due to the pandemic.

“The concerned services ministries have given us worksheets and we need to know what they have done this year or can still do until 2022 under the Government Action Plan with the Covid-19 implications,” said the MP.

“My committee is more concerned with actual work than the financial and economic aspect - we want to know what is practical and what is not.

“This is the only way we can recommend which projects should go ahead, be delayed or cancelled.

“The new national budget should mention financing of vital projects beyond Covid-19 and how the government plans to progress without the GCC support as it expires next year.”

It comes as Bahrain last month launched a BD4.3 billion economic stimulus package to offset the effects of Covid-19, which include paying for wages of Bahrainis in the private sector for three months, deferring loan instalments for six months, shouldering utility bills for three months, waiving government fees and helping small and medium enterprises.

The GDN reported last week that the Muharraq Municipal Council unanimously voted to drop all new municipal projects from the draft 2021-2022 budget.

The decision was taken to help the government recover from the impacts of Covid-19.

Councillors are also planning to make cuts in the budgets of infrastructure projects in the governorate for the two years with oil prices dropping sharply since the pandemic started sweeping the globe.

 

Source: https://www.youtube.com/watch?v=ytbtfDk5qpw

 

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