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Thu, 24 April 2014 14:50:03
Main opposition in Sri Lanka blows hot and cold over upcoming budget
05 Nov, 2006 12:46:18
November 05, 2006 (LBO) – Sri Lanka’s opposition United National Party which has pledged to support the ruling party in the budget vote says, it will criticize harmful features of the budget, because economic policy is not included in a recent co-operation deal signed between the two parties.
“We were not consulted on the upcoming budget, our views were not sought and our input is not included in the budget,” former Deputy Finance Minister and Parliamentarian Bandula Gunewardene said.

“What we said was that we had no intention of bringing down the government by defeating the budget vote, not that we approve of the budget.”

Gunewardene was responding questions from journalists on how a responsible opposition could give blanket approval to a budget they have not even seen, at a media briefing this week.

The budget is due to be presented to Parliament on November 16.

The United National Party which is facing a leadership crisis, struck a deal with the Sri Lanka Freedom Party of President Rajapakse in October to work together, especially to take forward the peace process.

Political analysts say the UNP leadership had taken the extraordinary decision to support a budget they had not even seen in a desperate bid to avert a crisis within the party and stop members from crossing over to the government.

Gunewardene charged that senior bureaucrats in charge of economic policy was deceiving the President who is also the finance minister, and hiding their incompetence.

“Inflation has now gone up to 17.2 percent, and oil prices are falling,” he said. “They can no longer say inflation is caused by rising oil prices. It is because they are printing money to finance the budget deficit.”

He said the in their time, tht UNP had completely stopped printing money and brought down inflation to 3 percent despite rising oil prices.

Gunewardene says the numbers show the real picture and if the President believed what was said by officials in air conditioned offices (seether karmerer), there would be more misery ahead for the people.

“I challenge anyone to disprove that we brought inflation down when we managed the economy,” Gunewardene said. “The numbers speak for themselves. Can anyone deny that inflation is now 17.2 percent and the rupee is 108? Can anyone say that our total foreign reserves had not fallen?

He said the rupee was being devalued (barldu welar) because the government was printing money to finance the budget, and it had been held at these levels through heavy central bank intervention.

Gunewardene claimed that the central bank had spent 352 million dollars from January to September to defend the rupee, with 121 million dollars being spent from September 01 to 19.

"I predicted this would happen when the budget was presented last year," Gunewardene said.

"There won't be a tsunami to help us this year." .

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READER COMMENT(S)
1. Sena Nov 06
This budget should be a hoot. A typical war budget ? so high defense spending by a country that's in a lot of debt - the money has to come from taxes, borrowings and printing.

The IMF I bet is scratching its head as it gets its hand early on the budget proposals.

Since MR is choosing the war-path, everyone should hope that its decided sooner than later, if not, all Prabhs has to do is hide in his lair, with his hit and run attacks, and keep the struggle going, to deny the GOSL of a decisive victory.

Some of the ways that the economy will be able to get back on track is through tighter monetary policy and Central Bank independence from a bossy Sec. Treasury; investment to bring in $ to boost reserves and take pressure off the x-rate (but we need QUALITY investment, not just some mutt who's gonna come put up some substandard construction thats going to crumble in 5 years); overhaul the entire education system, and make the tax system more fair so people are rewarded for taking business initiaitve without being penalized for making money.

Also there has to be a government who's going to stand up to the unions, and implement tough reforms, namely a public sector reform to cut the size of the public sector and privatize, at least in some form or fashion, entities that are not essential to have government control, reform the CEB, and other loss-making government entities.

Because at the end fo the day, its the taxpayers who are footing the bill for the government's spinelessness and the unions' selfishness.

So there is no point jumping and dancing around a budget - its best take the budget documents and make a bonfire with 'em and jump and dance around that in our sarongs and red scarves, singing praises to the Chinthanaya thats weaknening our currency, eroding our hard earned assets and purchasing power, makes us get stopped at 3-4 checkpoints a day, sit in traffic for twice as long on a daily basis burning twice as much fuel, takes more of our money from absurd taxes - the benefits of which we never see.!

Pro-poor is not INFLATIONARY ECONOMICS Mr. chinthanaya. Pro-poor should encourage the private sector to mobilize assets and capital to rural areas to generate greater output at more efficient cost so that the poor can reap the rewards of productivity, value addition and hard work.

And you don't do that by squeezing the private sector for every last penny they make as profit thru absurdly ridiculous tax policy.

And i'm not done, i'm just stopping for lunch.