Financial secretary forecasts the budget cuts

Financial secretary Ali Mansoor gave a glimpse of the 2012 budget that will be presented by the new minister of Finance, Xavier-Luc Duval by the end of November, in the circular bearing the reference CF/PBB/PREP/ 2010. This was addressed to the supervising and accounting officers of all ministries.

The policy of “cut costs at all costs” will prevail again. The financial secretary emphasised on the importance of reducing expenditures based on economic developments in recent times.

Mansoor mainly emphasised on the micro economic situation to justify this position. “In its most recent assessment, the IMF has indicated that under a scenario of no shocks from the Euro-Zone or US debt default, the global economy will grow by 4.3 per cent in 2011 and 4.5 per cent in 2012,” he said. In such a situation, the chief financial officer predicts a growth of four per cent, which is lower than what was initially estimated.

Mansoor added, “The expected shortfall in revenue, combined with the forthcoming PRB salary review 2013, will exert significant pressure on public finances.” The heads of ministries and departments are required to submit their Programme-Based Budget (PBB) for the next three fiscal years (2012, 2013 and 2014) by August 29.