The government sent a revised 2014 budget draft to Parliament on December 2nd. The revised budget is approximately 7.32 billion lari. Compared to the initial draft the figure is reduced.
2014 state budget draft revised
By Gvantsa Gabekhadze
Tuesday, December 3
The government has explained that the reduction is linked with tax returns for those individuals whose annual salary is under 6000 lari. The budget will have to allocate at least 180-200 million lari for tax returns.
According to the revised draft, next year the government plans to issue 600 million lari’s worth of treasury bills on the domestic market next year (the figure was 400 million lari in the previous draft).
The chancellery will get 20 million lari, which is double what was allocated to it in the initial draft. The presidential administration will receive 9 million lari. The president’s reserve fund will be halved to 5 million lari. However, the government’s reserve fund will remain unchanged at 50 million lari.
Funding for municipal governments will be increased, totalling 76 million lari. Funding for Tbilisi's government will be reduced.
Court employees’ salaries will increase. Funding for the healthcare, education, agriculture and infrastructure ministries has been decreased but funding for the Ministry of the Economy has increased by 62 million lari.
Minister of Finance Nodar Khaduri is sure that the 2014 state budget will have no problems and the economy will achieve 5% growth in the next year.
Parliamentary minority representative Zurab Melikishvili claims that from an economic point of view 2014 will be worse than 2013.
He stresses that the government does not intend to continue infrastructural projects and regional development. He also states that there is no evidence in the budget that the government plans to reduce unemployment and improve people’s standard of living.
Parliamentary majority MP Davit Onoprishvili claims that the United National Movement’s claims are lies. He states that when it was in power the UNM failed to increase pensions, create medical insurance and expand social assistance.
Economic analyst Emzar Jgerenaia believes that 2014 state budget draft does not reflect public needs.
“People need a budget that will reduce unemployment and create jobs. This can only be achieved through a total restructuring of the economy. We need structural reorganization and a decrease in government spending. The new cabinet of ministers should have a new vision and an action plan to solve these problems.” Jgerenaia states.
Economic professor Lia Eliava states that issuing treasury bills is a method for making up for the government budget deficit.
“This means that the economy is going down and the government is obliged to take a loan. In general, the bills are purchased by banks and accordingly, the state becomes a creditor of the banks.” Eliava said.