A pro-people Budget

Yesterday's budget had something for everyone and has been carefully crafted to take the country out of the current economic impasse brought about by external compulsions.

Therefore Budget 2009 can be described as a realistic one presented under trying circumstances in the midst of a world recession and other economic upheavals on the global scene.

President Mahinda Rajapaksa who presented his fourth budget yesterday as the Fiance Minister should be congratulated for taking steps to meet the aspirations of a majority of the public while at the same time taking measures to rebuild the economy which had been subject to the vagaries of global determinants as at no other time in recent memory.

He has done a more than satisfactory job of cushioning the impact of these negatives on the general public and ensuring that measures are taken to rectify the balance and place the economy on track.

He has succeeded admirably in striking a careful balance between the country's economic imperatives and public welfare. In this regard he has taken steps to enure that new taxes and levies would not impose undue burdens on the general public particularly the low income groups. For example, VAT has been brought down to 12 per cent.

On the contrary he defied expectations and delivered not inconsiderable relief to the vulnerable sections of society while taking meaningful steps to soften the blow of the cost of living on the average income earner.

An in-depth study of Budget 2009 would show that President Rajapaksa had carefully set out the priorities and done the optimum permissible to cater to diverse sectors of the economy. There are several measures too taken to open new income avenues with incentive schemes to promote growth.

With the way things are there would have been no reasonable expectation for any wage rise. But the President had paid heed to the present difficulties and had increased the Cost of Living allowance of all public servants by of Rs.1000 at a cost of Rs.12,000 million to the Treasury.

The President is bound to receive praise for slashing fuel prices that had a telling impact on the COL. A litre of diesel has been reduced by Rs.30, kerosine by Rs. 20 and petrol by Rs.15. The President said in terms of his calculations the price of goods and services could now be brought down by as much as 25 per cent and appealed to traders to pass on the benefit to the consumers.

He also announced a relief package for annual lump sum taxation of salaried income that would effect a 5% benefit. Pensioners too have received an increase of Rs.560. The President emphasized that it had been his practise throughout each budget every year to bring down the budget deficit in terms of GDP and thus reduce inflation.

This method has paid dividends with a significant drop in the rate of inflation since his last budget, he noted. The President's decision to get each Ministry to save 2 per cent of all administrative costs by which he hopes to save Rs. 2000 million annually is a sound policy.

He requested all officials to take the lead in ensuring this step is firmly implemented. This it is hoped would also pave the way for ridding all public institutions of the cancer of corruption to some degree. The slashing of levies on electricity and water too is bound to see a reduction in the cost of goods.

It is hoped that consumers would benefit by these concessions in real terms. It had been the practise of traders to jack up prices when the Government imposes levies, often out of proportion to the increase.

It is therefore incumbent on the authorities to ensure the reverse happens when levies are removed. This is the only way to ensure the people benefit from the budgetary relief. This Budget has also rightfully accorded a special place for the heroic forces now on the verge of annihilating terrorism.

The steps taken to increase the allowance of soldiers from Rs.3,000 to Rs.5,000 too is to be lauded given the role played by these valiant men in protecting the Motherland. The 1% levy collected for Nation Building fund too would not be begrudged by many. These monies would be spent on welfare scheme for soldiers, supplementing other funding.

All in all Budget 2009 is well a thought out Financial statement reflecting the continuation of the policies of President Rajapaksa's 10 year development programme for the country.

There can be little complaints about the budget under the present context. Not all demands and requests can be accommodated in any budget.

There will be many analysts who will present their views in the coming days. It is however the responsibility of all sections to support the Government to implement the budget proposals to realise the objectives outlined in the Budget.