Opposition points out bad maths in 2008 budget outcome

THE Opposition yesterday blasted the Government over its handling of last year’s budget resulting in an estimated K470 million deficit, The National reports.

Deputy Opposition leader Bart Philemon (Lae MP) said the Government did not get its sums right.

“They initially planned an expenditure of K6, 999.2 million.

“They revised this upwards by K790.7 million (to K7, 789.9 million) but ended up spending K7, 551.9 million,” Mr Philemon said.

“Effectively, they overspent by K552.7 million although they tried hiding this through the revised expenditure and net lending which showed they under-spent by K238 million.”

He told reporters at Parliament House yesterday that this was a classic case of “the sins of a Government catching up with it”.

“Without revising the budget, they were on target for a runaway budget deficit of K680.9 million,” Mr Philemon said.

“Their attempts to correct this in the revised budget, aiming for a budget deficit of K9.5 million from the K202.4 million surplus, did not work.

“They ended up with a final budget outcome of K478.5 million budget deficit,” he added.

“That should be reason enough for Treasurer and Finance Minister Patrick Pruaitch to resign.

“His inability to stick close to his own budget is a stinging indictment against the Government’s ability to manage the economy – particularly the finances – of PNG.”

The Opposition also alleged that Cabinet was “blackmailed” by Government backbenchers to allocate K534 million for

the district services improvement programme (DSIP) or they would not support

last year’s budget.

“What this means is that the Government did not honour its promises and obligations as this K534 million was part of the K6 million that was to make up each Open MP’s much publicised K10 million DSIP funding.

“The signal we got is that the Government was not communicating, consulting and managing its coalition partners and backbenchers, making the taxpayers pay for their knee-jerk reactions to make last-minute adjustments,” he said.

Mr Philemon said all the fiscal discipline he worked hard (as then treasurer and finance minister from 2002-05) seemed to have disintegrated into thin air.

He also expressed concern over the likely outcome of this year’s budget next year.

He said this was evident in the recurrent budget where, despite an upward revision by K2.9 million (from K3, 636.4 million in actual budget), the final budget outcome expenditure was an additional K127.4 million.

“Effectively, the Government spent K130.3 million when you compare the actual recurrent budget and the final recurrent budget expenditure outcome of K3, 766.7 million,” Mr Philemon said.