Draft 2013 budget by September 30 Balancing issues cause late delivery of 2012 budget

POSTED: 02/23/12 2:42 PM

St. Maarten – Finance Minister Hiro Shigemoto has put down his late delivery of the 2012 budget to parliament to balancing issues when it comes to the operating account and because the requests submitted by the ministries far surpassed the available means. He concludes though that he has given conservative, but realistic projections.
The 2012 budget is balanced and excludes grants like the financing that comes from Usona. The government is projecting to collect 24 million guilders more in income tax through increased compliance. They further project that nearly half (41 percent) of the budget will be spent on personnel, 27 percent on goods and service and 23 percent for contributions.
The single largest revenue source is wage and income tax (32 percent) followed by turnover tax (28 percent) and license fees for the bank, concession fees, casino and other business license fees.
In terms of expenses the government has proposed a budget that includes higher expenses for parliament and the high councils of state to allow them to pay staff, travel, pay external advisors, and participate in courses and communication. There are also increased expenses in the finance ministry because of increased personnel and interest and depreciation expenses. The ministry will also see a decrease in its allocation because of the end of Usona funding.
The ministry of tourism, economic affairs, transportation and telecommunication will also see an increase and decrease. On the one hand the ministry will see an increase in personnel costs, while 5.7 million in Usona funding will be discontinued.
There is a general concern about personnel costs in the finance ministry and the minister wants to take action on this.
“Personnel costs need to be controlled as soon as possible in order to keep the budget in balance in future,” the minister said.
The capital expenses for 2012 include finishing the new government administration building and infrastructure projects like the ring road. The total budgeted amount (65.6 million guilders). The amount will be financed from cash, bonds and depreciation of material fixed assets.
The minister has also announced that any changes made to the budget during the handling means it would have to be re-submitted to the Cft for advice.
“If these changes are budgeting neutral the process could possibly be shorter than if changes are made without considering how to cover the changes increase(s) in costs in the draft budget. This in turn would mean a longer period without an approved budget 2012,” Shigemoto said.
The finance ministry has already started the 2013 budget cycle. Each ministry will receive a framework document soon indicating each ministry’s budget room for 2013.
“The finance ministry will calculate the expected income level for 2013, the “pie” to be divided amongst the ministries.  Each minister has the responsibility to budget within the allocated portion of the total budget to each ministry,” Shigemoto said.
The expectation is to present the 2013 budget by September 30.

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