A K10.56 billion budget was tabled in parliament yesterday by
Treasurer Don Polye, who was confident the government would see through
its implementation, The National reports.
The expenditure budget is an increase by K1.232 million – or 13% from the 2011 budget.
Polye described it as a balanced budget as the expenditure equated with revenue and grants.
It was the first time for the appropriation bill to hit the K10 billion mark.
He described the budget as “large and responsible” without any deficit or surplus.
“A responsible budget is essential as it is set against a backdrop of high domestic growth and inflation, and a level of uncertainty in the global economy,” he said.
He said it would provide a stable and prudent macro-economic and fiscal framework.
The key new funding priorities for the 2012 budget are the government’s commitment to tuition-free education, the 2012 general election and the 2015 Pacific Games to be hosted by PNG.
Its total development budget for 2012 is K4.437 billion compared to K4.04 billion last year.
Direct government funding for the development budget is set at K2.437 billion.
The rest of the funding will come from tax credits at K130 million, loans at K479.4 million and grants at K1.39 billion – less than the 2011 grants of K1.52 billion.
The grants estimates will decrease due to the appreciation of the kina, reduction in Japanese aid due to the tsunami, completion of the Asian Development Bank project in 2011 and reduction in aid levels from the European Union and World Bank as project “frontloaded” in 2011.
There has, however, been projected increase in Australian aid to PNG. Total AusAID funding is: Education – K299.9 million, transport – K189.73 million, health and HIV – K232.3 million, law, order and justice K74.8 million plus a non-partnership component of K295.3 million.
Thus the AusAID support for PNG’s development budget is K1.09 billion.
The government is basing its budget assumptions on a GDP growth rate of 7.8%, non-mining GDP growth of 7.4%, year average inflation of 7.6% (December to December 8.1%), interest rates on treasury bills at 7.5%, inscribed stock at 9%, oil price at US$85 per barrel, copper price at US$8,819 per tonne and gold at US$1,884 per ounce
The expenditure budget is an increase by K1.232 million – or 13% from the 2011 budget.
Polye described it as a balanced budget as the expenditure equated with revenue and grants.
It was the first time for the appropriation bill to hit the K10 billion mark.
He described the budget as “large and responsible” without any deficit or surplus.
“A responsible budget is essential as it is set against a backdrop of high domestic growth and inflation, and a level of uncertainty in the global economy,” he said.
He said it would provide a stable and prudent macro-economic and fiscal framework.
The key new funding priorities for the 2012 budget are the government’s commitment to tuition-free education, the 2012 general election and the 2015 Pacific Games to be hosted by PNG.
Its total development budget for 2012 is K4.437 billion compared to K4.04 billion last year.
Direct government funding for the development budget is set at K2.437 billion.
The rest of the funding will come from tax credits at K130 million, loans at K479.4 million and grants at K1.39 billion – less than the 2011 grants of K1.52 billion.
The grants estimates will decrease due to the appreciation of the kina, reduction in Japanese aid due to the tsunami, completion of the Asian Development Bank project in 2011 and reduction in aid levels from the European Union and World Bank as project “frontloaded” in 2011.
There has, however, been projected increase in Australian aid to PNG. Total AusAID funding is: Education – K299.9 million, transport – K189.73 million, health and HIV – K232.3 million, law, order and justice K74.8 million plus a non-partnership component of K295.3 million.
Thus the AusAID support for PNG’s development budget is K1.09 billion.
The government is basing its budget assumptions on a GDP growth rate of 7.8%, non-mining GDP growth of 7.4%, year average inflation of 7.6% (December to December 8.1%), interest rates on treasury bills at 7.5%, inscribed stock at 9%, oil price at US$85 per barrel, copper price at US$8,819 per tonne and gold at US$1,884 per ounce
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