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
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
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.