Soeharto to propose state budget
Soeharto to propose state budget
JAKARTA (JP): President Soeharto is to propose the 1996-1997 state budget to the House of Representatives today, a budget most analysts expect to be as austere as the current one.
Most economists do not expect the draft state budget to increase substantially from the current one which is projected to balance at Rp 78.02 trillion (US$34 billion) due to great concern over economic overheating.
They have warned that last year's economic overheating may worsen this year if the government does not take serious measures to curb inflation and reduce the current account deficit.
The 1996-1997 budget proposal, to be unveiled in a nationally- televised address at the House plenary session, will cover the third year of the current sixth Five-Year Development Plan period ending in March 1999.
Central Bank Governor J. Soedradjad Djiwandono was quoted recently by Reuters as projecting that the 1996-1997 budget plan will expand by not more than 11 percent over the current (1995- 1996) budget.
The current budget, ending in March, is set to balance at Rp 78 trillion (US$34 billion), up 11.9 percent from the previous one.
But 12 percent will represent an expansion of less than four percent in real terms, adjusted for last year's inflation of around 8.64 percent.
At a hearing with the House Budgetary Commission in November, Minister of Finance Mar'ie Muhammad said that the next budget plan would assume an average oil price of $16.50 per barrel.
Oil and natural gas still contribute about 25 percent of the government's internal revenues.
At the same hearing the Golkar and the Armed Forces factions estimated the 1996-1997 budget to balance at Rp 91 trillion, an increase of Rp 13 trillion or 16.6 percent from the current one.
The United Development faction projected the next state budget to balance at about Rp 89.5 trillion. The figure was based on the assumption that internal revenues will increase by 20 percent to Rp 77.8 trillion but foreign loans will remain at the same level as in the current budget, at Rp 11.76 trillion.
Of all the factions, the Indonesian Democratic Party faction made the highest budget projection, expecting the next budget to balance at Rp 94 trillion, an increase of 20 percent.
Fifteen members of the cabinet last night briefed news media editors on the budget, which will be proposed by President Soeharto today.
The members included (from left to right) Minister of Transportation Haryanto Dhanutirto, Minister of Tourism, Post and Telecommunications Joop Ave, Minister/Cabinet Secretary Saadilah Mursid, State Minister for Development Planning Ginandjar Kartasasmita, Minister of Finance Mar'ie Muhammad, Minister of Information Harmoko and Coordinating Minister for Production and Distribution Hartarto.
Also present at last night's briefing were Minister/State Secretary Moerdiono, Bank Indonesia Governor J. Soedradjad Djiwandono, Minister of Mines and Energy I.B. Sudjana, Minister of Industry Tunky Ariwibowo, Minister of Agriculture Sjarifudin Baharsjah, Minister of Cooperatives and Small Enterprises Subiakto Tjakrawerdaya, State Minister of Agrarian Affairs Soni Harsono and Minister of Manpower Abdul Latief.(rid)