Legislators complete debates on revised 2003 budget

Legislators complete debates on revised 2003 budget

Dadan Wijaksana, The Jakarta Post, Jakarta

After weeks of intense debate, the House of Representatives'
budget commission completed its revision of the 2003 state budget
on Thursday, clearing the last hurdle for the House to approve it
later this month.

"Now, we just have to wait for the House's plenary meeting to
pass it into law on Nov. 25," commission head Abdullah Zainie
announced after presiding over the final discussion on the
budget.

He added that the last item approved was the increase in the
allocation of funds to regions to Rp 76.98 trillion (US$8.6
billion) from Rp 75.41 trillion under the first draft of the
budget.

The approval should bring relief to many people who had been
worried that the deliberation of the budget could not be
completed this month and thus would force regional governments to
delay discussions about their own budgets. The regions draw up
their own budgets based upon figures stipulated in the central
government's budget.

The House will recess at the end of this month.

The commission and the government have agreed to raise the
budget deficit to 1.78 percent of GDP or Rp 34.44 trillion from
1.3 percent in the first draft.

Of the total deficit, some Rp 22.45 trillion will be funded by
domestic sources such as privatization and asset sales, while the
remainder will be covered by foreign financing, which is expected
to come from donor countries grouped in the Consultative Group on
Indonesia (CGI).

"Overall, I can say that the revised version we approved today
is better than the initial one. For instance, the revised budget
allocates more for economic stimulus than the amount first
proposed by the government," he added.

Under the revised budget, some Rp 10.6 trillion in extra
development spending is allocated to help stimulate the economy.
The figure was almost double the government's proposal of Rp 5.9
trillion.

The stimulus in question is aimed at softening the impact of
the Oct. 12 Bali bomb blasts on the country's economy.

The debate, which lasted for over a month, centered mostly on
adjusting most of the figures in the initial draft budget,
presented to the House in August, to better reflect the economic
impacts of the Bali bombings.

Zainie said that the revised version set a target for total
state revenue at Rp 336.2 trillion, or Rp 8.3 trillion higher
than the initial target.

"That figure has taken into account a Rp 4.7 trillion cut in
the tax revenue target, from Rp 260.8 trillion to Rp 254.1
trillion," he said.

The draft also assumes a 4 percent growth and 9 percent
inflation, while the rupiah's exchange rate is set at 9,000 per
dollar and Bank Indonesia's three-month interest rates at 13
percent.