House gives discretion to govt to raise 2010 spending

The House of Representatives’ budget committee has approved the 2010 state budget bill, including a crucial article allowing the government to raise expenditure if needed.

The committee’s approval means that the bill is only waiting for official endorsement from a plenary session of the House.

In a hearing with the government and the central bank until 2 a.m. Friday morning, the House set the total expenditure for the 2010 budget  at Rp 1,047.67 trillion (about US$101 billion), with Rp 725.24 trillion allocated to the central government and Rp 322.32 trillion to the regions.

Under article 23 of the bill, the government can add expenditure of up to 2 percent of the total expenditure, or about Rp 24 trillion, for priority spending that has no prior budget allocation.

The government must propose the adjustment within the first three months of 2010, according to the article. The House budget body should wrap up any proposed adjustment within a week of the government making a proposal.

“The article is (designed) to accommodate the new government to [help it to] implement programs that have no allocation, for instance the 100-day program,” Finance Minister Sri Mulyani said after the hearing.

Anggito Abimanyu, Finance Ministry’s head of fiscal policy, said this did not necessarily mean the 2010 budget deficit would increase.

“We may optimize other budget allocations (for any new spending),” he said.