Balancing the Budget of great expectations

The people remain hopeful that the 2022 Budget that is being presented today (12), which is also the first budget coming as a recovery budget following the outbreak of the Covid-19 pandemic, would reduce the economic burden on their shoulders. However, this Budget comes in a context where the Government’s ability to do that has decreased, while the people’s expectation for the same has increased, unlike in the pre-pandemic era.

That is precisely why Sri Lanka needs to consider this Budget a special one, and acknowledge the fact that the Budget should not be limited to fund allocations. In fact, this Budget is an opportunity for the Government to learn from actions and inactions on the part of previous governments as well as of its own.

Unlike the people, what the Government expects from this Budget remains rather unclear, in a context where the Finance Minister Basil Rajapaksa said that he was not sure as to what the Government can give the people through the Budget and that the people may have to give something instead.

However, people’s expectations, which constitute the lion’s share of the country’s expectations, cannot be played down that way.

Reliefs, like every other year, are the people’s main expectation. However, unlike in the previous years, these reliefs should not be limited to merely supporting the people to deal with the increased cost of living. In fact, time has come for Sri Lanka to rethink this aspect of the budget, and the Government has to make sure that these reliefs contribute to national recovery efforts in some way, because every rupee that gets allocated through this Budget has an impact on the national economy.

Essentially, in the next few months, the Government has to take an extra step, and evaluate how the fund allocations that do not bring any direct income contribute to the national economy. If done right, it can be a lesson in the drafting of the next budget, which will also be a recovery budget.

In the next few months, the Government will also have to pay prompt and extra attention to its main expenditures such as paying the salaries of public sector employees. Even though paying their salaries and giving them due increments and facilities is an important and undeniable expense, the Government has a responsibility to pay attention to the wasteful expenses that come at the expense of genuine salary increments and the provision of facilities.

In addition, while controlling the existing expenses, there is a pressing need to close the door on new expenses. To do that, the Government must stop following the traditional political practice of giving jobs and salary hikes to anyone who asks for those with the hope of garnering votes in the next election, and instead, look into their genuine demands with a clear idea about how much it can spend, and how much of that money comes from the people’s tax money.

Most importantly, in 2022, the Government has to balance allocated funds and expenses. On the one hand, members of the Government must stop spending lavishly merely because funds have been allocated for their expenses, and on the other hand, all crucial projects for which funds have been allocated should continue for the country to benefit from them. We do not know whether the Government has learnt anything from previous budgets; however, if the Government balances its expenses, income and allocated funds, the 2023 Budget will be better than this Budget.

Presenting or passing the Budget is merely a first step in getting ready to face the next year’s economic challenges, and it is how we manage the above mentioned aspects, which come after this Budget, that determines the nature of the 2023 Budget.

The Government has a great deal of rethinking to do, and that has to start right after the passing of the 2022 Budget.