Misleading Sri Lanka budget estimates lead to broken promises
ECONOMYNEXT – Budgets prepared by successive Sri Lankan governments based on inaccurate revenue estimates lead to unexpected spending cuts and broken promises, investigations by Verité Research, a think-tank, has found.
The new tax law introduced by the government, which simplified and ensures stability in the tax regime, is important since regular changes in tax regulations over the past two or three decades created uncertainty, Verité’s executive director Nishan de Mel said.
“The problem is estimates are not done properly,” he told a news conference to announce the launch of their new platform, BudgetPromises.org, which tracks the government’s implementation of promises made in the last budget.
De Mel said parliament’s public finance committee, which monitors ongoing government projects, had been probing whether finance ministry budget estimates presented to parliament were accurate or given just to please elected members.
“If budget estimates are not done properly, the government gets a wrong idea of revenue and shapes spending accordingly,” de Mel said.
“But if revenue does not come, then the government is forced to cut spending and break budget promises.”
The analysis of budget proposals of over Rs1 billion by Verité Research shows a marked lack of transparency by the government with the status of the progress of most projects concealed either deliberately or for lack of initiative.
(COLOMBO, October 27, 2017)