Oct 18, Colombo: The Sri Lankan government has allocated the highest amount, nearly 230 billion rupees, of expenditure to the newly organized Ministry of Defence and Urban Development in the 2012 Appropriation Bill that was presented to the parliament today by the Prime Minister D.M. Jayaratne for its first reading.
The expenditure for defence has been increased nearly 7 percent from Rs. 215 billion last year as the Ministry is now combined with the Urban development Authority to handle the development of main cities in the country.
According to the government, the total expenditure for 2012 is estimated at Rs. 2.22 trillion (US$ 20 billion) necessitating an increase in Recurrent Expenditure from Rs.1. 029 trillion in 2011 to Rs.1.109 trillion in 2012, and the Capital Expenditure from Rs.938 billion to Rs.1.111 trillion.
The total revenue for 2012 is estimated at Rs 1.115 trillion.
The US$ 20 billion Appropriation Bill for 2012 has allocated 104 billion rupees for the Ministry of Economic Development, 124 billion rupees for the Ministry of Finance and Planning, over 144 billion rupees for the Ports and Highways Ministry and 102 billion rupees for the Ministry of Highways.
The allocations for health and education sectors have been increased in the Bill. Over 73 billion rupees has been allocated for the Ministry of Health Ministry of education is to receive 33 billion rupees.
President Mahinda Rajapaksa in his capacity as the Finance Minister will present the Budget 2012 in Parliament (Second Reading) on November 21. The Bill will be debated for seven days from 22nd 30th November and the vote on the budget will be taken then on the last day of the debate.
The Committee stage debate will be held for 17 days including Saturdays except on December 10, from 1st to 21st December and the vote on the third reading is scheduled to be held on December 21.
The government is aiming to reduce the budget deficit at 6.2 percent of GDP while maintaining an 8 percent economic growth and an annual inflation between 6 and 7 percent in the 2012 budget.
Although Sri Lanka has shown strong improvement in fiscal performance, the International Monetary Foundation (IMF) last year advised Sri Lanka to take forceful action to reduce the budget deficit and public debt.