House approves 2002 state budget

Dadan Wijaksana, The Jakarta Post, Jakarta

All ten factions of the House of Representatives unanimously approved, at a plenary session on Wednesday, the government- proposed 2002 state budget draft into law.

The approval finally ended earlier speculation that the House might have delayed it until December, after the budget committee had extended the deadline for the completion of the budget debate several times. The delay would have angered regional administrations, which are entitled to receive funding from Jakarta for next year's administrative expenditure.

"After long debate with the (House budget) committee, the bill has finally been approved," Minister of Finance Boediono said in his speech.

"This approval is very significant, as it provides a constitutional basis for the country's development sustainability," he added.

With a total state revenue of Rp 301.9 trillion (US$30 billion) and state expenditure of Rp 344 trillion, the budget deficit for next year will be Rp 42.1 trillion, or equal to 2.5 percent of the country's gross domestic product (GDP).

The government had previously proposed a budget deficit of Rp 43.03 trillion.

The government first presented the bill to the House in September, but the global economic slowdown -- which has been accelerated by the September attacks on the U.S -- has prompted the government to revise the budget's basic assumptions.

The approved 2002 budget now assumes an average rupiah exchange rate of 9,000 against the U.S. dollar, compared with 8,500 originally, while economic growth is expected to reach 4 percent (from 5 percent), inflation 9 percent (from 8 percent), and the international oil price $22 per barrel (unchanged).

Meanwhile, the proceeds target of the privatization program is set at Rp 6.5 trillion, while the sale of assets under the Indonesian Bank Restructuring Agency (IBRA) is expected to rake in some Rp 48.2 trillion.