State revenues estimated to exceed target
State revenues estimated to exceed target
JAKARTA (JP): State revenues during the current fiscal year (1995-1996) are estimated to exceed the set target by 3.6 percent or Rp 2.8 trillion (US$1.2 billion), it was concluded yesterday in a hearing between the Ministry of Finance and the House Budgetary Commission.
The figure is based on actual receipts from taxes and other levies and foreign loans during the first semester (April through September) of the current fiscal year and an expected rise in revenues during the next semester, said the commission's chairman, I Gde Artjana, of the Armed Forces faction on the last day of the four-day hearing.
According to the budget plan, government revenues are estimated at Rp 78.02 trillion.
During the first semester of the current fiscal year, revenues from oil and gas reached Rp 7.4 trillion, or 55 percent of the whole year's target. This was due to the average oil price of US$17.27, higher than the targeted $16.50 per barrel.
Tax receipts from the non-oil sectors amounted to Rp 20.06 trillion, or 44.6 percent of the target, and other revenues reached Rp 1.09 trillion or 16.9 percent of the target.
Foreign loan disbursements during the first semester amounted to Rp 5.62 trillion, or 47.8 percent of the target. In the second semester, foreign loans are expected to be Rp 6.1 trillion.
Despite the encouraging development, the House members warned the government of various possibilities that could destabilize the budget plan in the second semester.
The Indonesian Democratic Party (PDI) faction, for example, noted that oil supplies from non-OPEC producing countries, such as countries of the former Soviet Union, had started to enter the international markets.
"This could lead to a drop in oil prices," the PDI faction cautioned.
The faction also noted that the large current account deficit in the first semester showed that the export promotion had failed to increase exports to the desired level.
"In fact, during the last few years, the growth rate of exports of non-oil products has been declining," said Gusti Ayu Eka Sukmadewi, a spokeswoman for PDI.
The government said that the larger deficit was partly caused by the increase in imports of capital goods for foreign and local investment projects.
But the PDI faction argued that there is no indication that such imports will increase exports.
The Golkar faction stressed the need for better coordination and supervision among government agencies in pursuing development programs.
"Besides, the government should eliminate all economic distortions, such as protection, monopoly and oligopoly that have caused the high costs of economy," said Boy Musbar Nurmawan of the Golkar faction.
Next year
At the last day of the hearing, all four factions of the commission came up with different figures on the next budget plan (1996-1997).
The Golkar faction estimated that the 1996-1997 budget plan will balance at Rp 91 trillion, an increase of Rp 13 trillion or 16.6 percent from the current budget plan that was set at Rp 78.02 trillion.
The faction of the United Development Party (PPP) 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.
The Armed Forces faction estimated the next budget to balance at Rp 91 trillion, an increase of Rp 12.8 trillion or 16.6 percent.
Of all the factions, the PDI faction made the highest budget projection, expecting the next budget to balance at Rp 94 trillion, an increase of 20 percent from the current budget.
The next budget plan is based on the target growth of 7.1 percent and the average oil price of $16.50 per barrel.
The commission also noted that the 1996-1997 budget plan should be devised in such a way that it will maintain economic stability and will further enhance a more equitable distribution of income.
The commission also asked the government to continue economic reform measures in the next fiscal year.(13)