Budget 2024, certainly, exceeded the expectations of many who would have anticipated a drastic pruning down of welfare measures and the introduction of drastic steps to enforce tight financial discipline given the present dire economic situation.
Instead President Ranil Wickremesinghe, as Finance Minister, presented a budget that offered relief to almost all segments even confounding some in the Opposition like SJB MP Dr. Harsha De Silva who described it as an election budget.
The budget has laid out a road map for economic emancipation to take country towards economic self- reliance rather being dependent on others to bail us out and making us an indebted nation.
Certainly, relief in the form a Rs. 10,000 increase in the Cost of Living Allowance to public servants and a Rs. 2,500 increase in pensions will be viewed as a welcome bonanza by the recipients. Hopefully, the private sector will follow suit since nearly 60 percent of the workforce are in the private sector and are equally burdened by the runaway COL. This no doubt is a significant increase although the demand of the Public servants was for a Rs. 20,000 allowance which is unrealistic under existing conditions.
Ideally, a proportionate increase should be added to the daily wages of estate workers, who continue to be left in the lurch whenever public servants are benefited through budgets. The President, who recently pledged to ingrate the plantation community with the general Sri Lankan society would ensure they are looked after this time around.
The Budget contains provisions to handover the ownership of estate lands to the plantation workers which is a commendable step considering that even after 200 years of their arrival in this country the community is reduced to the status of squatters with no land to call their own. The Rs.10 billion allocated for community development in the hill country too is a positive development.
There are also other measures contained in the Budget that would ease the financial burdens of the people. The step taken to halt the charging of rent form 50,000 urban low income families occupying Government housing and instead hand them full ownership of the houses would be a great relief to these segments which could be seen from the wild celebrations that accompanied the President’s announcement by these folk.
The monthly allowance raised for senior citizens too would have been well-received particularly by those dependent on medicines to survive, which are extremely costly. A dedicated provision Rs. 10 billion to continue the monthly allowance of Rs 4,500 for pregnant women too is a commendable step.
The measures taken in Budget 2024 to treble the financial provision for social relief payment or ‘Aswesuma’ that will benefit four million people is significant given a recent WHO study which found that one thirds of the country’s households were skipping at least one meal a day. The Government must ensure that only the deserving are made recipients of this benefit for it to have the desired effects.
The steps taken in the Budget to increase tax revenue were expected given that it is only through tax revenue that the Government is able to finance the extensive welfare measures, with the printing of currency out of the question given the International Monetary Fund (IMF) dictates.
The requirement makes it compulsory for those opening new current accounts in banks, registering the purchase of a new vehicle or acquiring land to produce the tax file number, which will ensure the expansion of the tax base. This also shows that at least this time around the Government is taking serious measures to rope in the tax dodgers. The measure will now raise tax revenue to Rs.3,820 billion from the current estimate of Rs 2,596 billion.
Budget 2024 also spells out far reaching measures going beyond a mere financial statement and fiscal policy. It contains measures that address the grievances of the minority communities. The Budget has allocated Rs.2,000 million for the resettlement of homeless families in the North and East. This has been a longstanding bone of contention among the Tamil community and at least this time around it appears that serous steps are being contemplated to redress the grievance of the community who had been displaced during the war. An additional Rs.1000 million too has been allocated to pay compensation for missing persons and other victims of the Northern conflict.
Budget 2024 has also envisaged the setting up four new universities and rules have also been stipulated for the conversion of certain private higher education institutions into universities, both of which are important steps considering the large numbers that are being left out of university education. This could also be a significant step that would help contain the brain drain through the production of more graduates to be absorbed into various professions.
The allocation of Rs. 55 billion for completing projects hit by the economic crisis too is significant which hopefully would also extend to assist the thousands of businesses that collapsed both as a result of the economic crisis as well as the Covid pandemic.