Futuristic budget

A national budget is a fiscal policy document that charts the future course of a country's economy. In that sense Budget 2010 presented by Acting Finance Minister Dr Sarath Amunugama in Parliament on Tuesday fulfills this criteria admirably. There were high expectations among many segments of society that this first budget presented following the defeat of terrorism would lavish handouts in the form of wage increases, subsidies, tax concessions etc.

But we have to grasp the long term picture. The groundwork has to be set first for reaping the full benefits of the dawn of peace. This is what Budget 2010 has striven to do. Besides a country's economy cannot boom overnight just because a war had ended- and a 30-year long war at that, for a free disbursements of handouts. Still our economy performed admirably amidst severe odds though it has not yet come to that stage where wage increases can be granted willy nilly. One has to consider that even amidst the height of the war public sector wages were raised on several occasions. The minimum basic wage was raised to Rs 12,000 with the intervention of President Mahinda Rajapaksa. The UNP and the JVP who are planning agitation campaigns against the absence of wage rises in the Budget should be realistic. The economy has to be built into a sound footing before the country could afford across the board wage hikes.

There are ample features in the Budget 2010 to suggest that the right fiscal policies have been put in place to realize the long term objectives for the country in the development sphere. This was no easy task. One must not forget that the world was caught up in the worst economic recession since the depression of the 1930s, which swept many a powerful nation off their moorings. That Sri Lanka was able to absorb the shock is a demonstration of the prudent economic management and fiscal discipline followed under the guidance of President Mahinda Rajapaksa. His production drive ensured that Sri Lanka was saved from the world food crisis even as the country was battling terrorism.

Budget 2010 also provides a good overview of the Government's performance on the economic front while at the same time articulating the future economic goals of the country. It is certainly a forward looking budget in all respects that has set the tone for the the economy to take off.

Though more or less an interim statement of its performance on the fiscal front there was nevertheless several features in Budget 2010 that spoke of consolidation. The priority to maintain a deficit substantially below last year's level without disturbing development activities is significant. It was also a realistic budget in that no haste was made in resorting to popular measures in the first flush of war victory. Hence there was no wage increase, subsidies or other handouts to pander to popular sentiment. These are slated to be introduced in the November Budget for 2011 when the full picture of the future course of the economy will be clearer.

However, one could say that Budget 2010 has laid the groundwork for the country's long term development goals with the emphasis on increasing productivity. Dr. Amunugama also spelled out a wide range of people friendly proposals aimed at accelerating public welfare and productivity. Productivity can only be achieved with a sound base of human resources. The people should be equipped and conditioned to be partners in the development process. For this, they should be provided with the necessary means and wherewithal. Hence the stress laid on developing this very vital asset of the mass resource base. In this regard the measures taken to uplift education and health assistance to vulnerable groups and incentives for small scale enterprises etc. assume significance. That Sri Lanka has targeted a six percent growth this year is indeed commendable considering that it is only just emerging from the ashes of war. In this regard the emphasis laid by President Rajapaksa against neglecting productivity even amidst the colossal war expenditure is beginning to pay dividends.

Budget 2010 naturally laid importance in addressing aspects related to the fallout of the war. The decision to provide for disabled soldiers has to be viewed in this context. There is much that needs to be done for our War Heroes who made the country's future economic dream possible. The Government has also given priority for improving the living conditions of the IDPs.

Farmers too have received a bonanza in the form of a Rs 35,000 million fertilizer and credit subsidies demonstrating the Government's priority in the area of agriculture production.

It is hoped that the wheels of adminstration will roll smoothly and efficiently to realize the goals set out in Budget 2010.