President U Win Myint chairs second meeting of Finance Commission

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President U Win Myint chairs second meeting of Finance Commission

President U Win Myint, in his capacity as the Chairman of the Finance Commission, made an address at the second meeting of the commission for this year at the Presidential Palace in Nay Pyi Taw yesterday.
The meeting focussed on discussions and approval of Union Budget and Union Budget Bill of 2010-2021 fiscal year, in the presence of Vice-Chairmen of the Commission Vice Presidents U Myint Swe and U Henry Van Thio, the commission’s Secretary Union Minister U Soe Win, its members Auditor-General of the Union U Maw Than, Chairman of the Nay Pyi Taw Council, and Chief Ministers of State/Region governments.

President U Win Myint said that the global economy is declining due to the COVID-19 pandemic; the income of public and private sectors was expected to decline in the 2020-2021FY like the second 6 months of 2019-2020.

He said that all the Union-level and state/region level departments and organizations need to use available budgets effectively and efficiently.

The budget allocations for the fiscal year include expenditures of COVID-19 relief funds, the costs for education, health and social sectors, foreign grants and loans, electricity, bridges and roads, drinking water and irrigation water, and the budgets for the Union Election Commission to organize the 2020 General Election.

He said there was a need to avoid overlap of the capital expenditure between the Union budget and the state/region fund by coordination among the Union ministries and state/region governments.
The President emphasized the delay of budget processes as in construction, tender invitation, scrutinizing, contracting and step-by-step payments on project completions although the Hluttaw has been pointing out the delay frequently.

He also instructed on the use of foreign grants and loans efficiently; and effective use of the foreign loan approved by the Hluttaw in 2019-2020 FY for COVID-19 relief plan.

Despite the possible decline of tax revenues, revenues and other incomes in 2020-2021FY, the Union Government would allocate appropriate budgets to prevent serious economic impacts from the COVID-19.
The total Union’s total revenue in the four- year terms this administration has increased from K16,979 billion to K27,852 billion; the Union’s total expenditure from K20,267 billion to K34,652 billion, especially in production, trade, service, infrastructure, human resources, education, health and social protection.

He requested the commission to discuss the Union Budget and Union Budget Bill of 2020-2021 fiscal year to be able to submit these documents to the Pyidaungsu Hluttaw.

Vice President U Myint Swe called for timely completion of projects included in the COVID-19 Economic Relief Plan (CERP) and other beneficial works for the country in the related fiscal year.

He also explained budget scrutiny of the commission not to exceed the mid-term frame, to check new projects with the government’s prioritized policy, to ensuring completion of construction projects, not to overlap the projects between the Union government and the local governments, and to ensure timely implementation of projects funded by loans.

He said the allocation of K150 billion emergency fund—K100 billion at the Union government and K50 billion at the Union ministries and region/state governments—increasing K50 billion compared to the previous fiscal year; more expenditures for social protections and funds for persons with disabilities have been allowed, in addition to the estimated budget of K2,381 billion from the Union Revenue for regions and states.

A deficit to GDP ratio is estimated at 5.41 per cent as the total expenditure was K34,652 billion and the total deficit was K6,800 billion, while the foreign grants and loans equivalent to at K1,122 billion and K4,034 billion, and the estimated budget for regions and states was K2,381 billion, making the total Union budget to be K27,852 billion.

Vice President U Henry Van Thio also said the increase of revenue share by K16 billion compared to the previous year, and that K369 billion would be allocated and development fund of Pyidaungsu Hluttaw will remain at K32 billion as in previous years.

The proposed budget of region/state governments includes K1,438 billion income and K3,819 billion expenditures, making a deficit of K2,381 billion.

The Revenue Expenditure of region/state governments will be K1,062 billion and the Capital Expenditure K2,757 after systematic scrutiny by the finance commission. The total expenditure was K 3,819 billion.

U Henry Van Thio explained that the commission prioritized local development projects rather than expenditures for construction of offices, guest houses and staff apartments, as well as purchasing vehicles.
He also advised for completion of projects in time and minimum return of surplus budgets, and requested the commission to approve the proposed budgets after review and discussion.

Union Minister U Soe Win, the Secretary of Finance Commission, presented Union Budget and Union Budget Bill of 2020-2021 fiscal year.

Members of the commission discussed the proposed budget and the bill.

In his concluding remarks, the President informed that the Union Budget and its bill would be submitted to the Pyidaungsu Hluttaw as the documents have been approved by the commission.

The President said that in using the budget, the first priority should be given to expenditures that would give direct benefit to the people; the second priority should be given to expenditures for offices and departments; that administrative costs at Union ministries should be reduced as much as possible; and that more funds should be used as needed for the economic development of the country and the advancement of the livelihood and living standards of the people.

He added that all the central organizations, Union Ministries, and region/state governments should use a good public finance management system in the management of Union revenues and expenditures with good intentions for the State and all citizens.