Ississ : JD7.87bln state budget for 2021

[30-11-2020 05:40 PM]

Ammon News -

 Jordan’s 2021 draft budget is projected at JD7.875 billion, and will be primarily financed from an estimated JD7.298 billion in public revenue, Minister of Finance Muhammad Ississ announced Monday.

The minister revealed at a press conference that the government expects a deficit of about JD2.05 billion after foreign aid, and JD2.632 billion, excluding foreign assistance. He said foreign grants for next year are projected at JD577 million.

Ississ told reporters that the 2021 draft budget projects total public expenditures at around JD9.39 billion, signaling an increase of 6 per cent compared with the current budget.

He further indicated that public payrolls (civic and military) and pensions comprise nearly 65 per cent of the state’s 2021 spending.

Further detailing public spending in 2021, the minister pointed out that operating expenses will account for 10 per cent of the budget while public debt service will have a 17-per cent provision.

With regard to current expenditures in the draft, Ississ said they are projected at JD8.749 billion, up by 3.9 per cent from this year’s figure, noting that JD1.779 billion will be used to finance civil servants’ payrolls while JD1.452 billion will be used to finance public debt service.

Other streams of current spending include JD201 million for the National Aid Fund, JD40 million in tax rebates and JD74 million that will be used to pay off past liabilities, according to the minister.

Ississ announced that capital spending is forecast at JD1.181 billion, up by 24.5 per cent against the figure in the 2020 budget.

Breaking down expected total revenue of independent government institutions, the minister said the figure is at JD916 million, including JD826 million in self-collected revenue, JD28 million in government support and JD63 million in foreign grants.

In turn, Ississ added, the total spending of independent government institutions is forecast at JD1.503 billion, indicating a deficit of JD587 million.

The minister did not rule out the possibility of issuing an annex amending the 2021 budget, saying his ministry has drawn up scenarios to revisit some provisions of the bill should the current epidemiological situation persist.

While drafting the budget, the minister said, the government sought to come out with the lowest rates of contraction expected during the next year, indicating that the government will not increase current tax rates or introduce new ones.

He added that he expected the economy to contract by 3 per cent while gross domestic product will expand by 2.5 per cent.

Ississ said the 2021 draft budget is in line with the His Majesty the King’s directives to strengthen social protection and healthcare spending, boost the citizen’s purchasing power and encourage investment.

He revealed that the draft includes a provision with a maximum ceiling of JD165 million to finance spending directed at addressing the coronavirus, adding that additional amounts will be made available to cover any additional healthcare needs.

Turning to economic development, the minister noted a 24.5 per cent increase in capital spending and other allocations needed to speed up public-private projects.

He added that the budget has taken into account the reclassification of some capital projects, placing them under capital spending.

Ississ also spoke about provisions earmarked to support public universities and needy students.

Furthermore, the draft set aside allocations to expand the social protection network and the umbrella of the National Aid Fund whose budget was raised by 38 per cent.

He noted that the draft budget also includes provisions for workers in the sectors hit by the coronavirus crisis.

The minister concluded that the government will conduct a quarterly review of expenditures and revenues and will focus on introducing "fair" measures to address tax evasion.

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