Tuesday, 5 July, 2022

Budget to focus on people’s welfare

The upcoming national budget for the 2022-23 fiscal year will put special focus on job creation as a tool for Covid-19 recovery while combining popular measures targeting the next elections.

The Budget Monitoring and Resource Management Committee has primarily estimated the budget size at Tk 6,778.64 billion which is 15.4 percent of GDP. The revenue target is being set higher at Tk 4,316.57 billion.

Finance Minister AHM Mustafa Kamal is expected to place the budget at the national parliament on June 09.

Bridling inflation, creating tax and business-friendly environment to enhance investment and employment, and widening of social safety net to safeguard the poor are the salient features of the new budget, according to finance ministry officials.

For better resource management at this crisis moment, funds might be shifted from less import projects to important ones while pumping in more money into megaprojects nearing the finishing line.

Stimulus package implementation will continue as a major tool for economic recovery, but there may not be any special programme for health sector as the covid situation is under control. However, the health sector as a whole may fetch more money.

Coupled with the global Covid-19 crisis, the Russia-Ukraine war has caused skyrocketing commodity price in the country.

The government may try to quell the suffering to some extent through budgetary measures like keeping commodity price within the reach of people and not charging additional taxes.

“It is almost sure that the size of the next budget in being increased. Employment generation, enhancing investment and social security are going to be main focus of the budget,” a finance ministry high official said requesting anonymity.

Whatever the budget figure would be, the government wants to give good news to the people through the budget, informed finance officials who touted the new budget as “people’s welfare budget.”

To put a cushion on the rising living cost, the budget would announce some steps that would help keep the rising living cost within the control of the people, they explained. The target of inflation for FY23 is being set at 5.5 percent.

The government is also arranging allocations in areas that directly appease the voters keeping in mind the next general elections, they also hinted.

With the improvement in corona situation, the government is going to set GDP target higher at 7.5 percent which was 7.2 percent for the outgoing fiscal year.

The budget deficit target is being set lower at Tk 2,429.41 billion or GDP’s 5.5 percent supported by higher revenue earning projection. The deficit crossed 6 percent in the current fiscal year.

The National Board of Revenue (NBR) has to collect Tk 3.70 trillion tax revenue, Tk 400 billion higher than current fiscal’s target of Tk 3.30 trillion. Non-NBR tax will be Tk 180 billion and non-tax revenue Tk 490 billion.

The size of the next fiscal’s Annual Development Programme (ADP) is likely to be proposed at Tk 2.5 trillion, which was Tk 2,253.24 billion in the current fiscal year. 

Apart from the stimulus package, agricultural mechanization for increasing food production, incentives for irrigation and seed, agriculture rehabilitation, the continuation of fertilizer subsidy, widening social safety net, free and low-cost food distribution among low-income people and massive job creation are being prioritized in the upcoming budget.

In addition, the government is going to introduce a universal pension scheme for private-sector job holders, preparation for which is nearly complete and a formal announcement may come in this regard, official sources said.