reactions to budget
The budget for 2006 has not generated the usual excitement that
accompanies such matters – either before or after the event.
This is one budget that no one seems to be interested in, except
for the politicians who predictably resorted to jaded slogans to
either support or oppose it.
This marked lack of interest and the guarded reactions that have
emanated from the business community is obviously because of the
uncertainty surrounding the whole affair – given the quite
high probability that it stands no chance of being passed by parliament
as the UNP and other key opposition parties are against it.
budget appears to be a continuation of the ruling coalition’s
economic policies based on a medium-term budgetary framework and
some of the numbers trotted out by various government spokesmen
appear quite impressive, such as the growth rates and increases
in revenue. But at the same time there have been speakers who have
been sharply critical of the budget, likening it to a fairy tale
that stands no chance of becoming reality.
the budget has generally drawn favourable comments from the business
community they have also pointed out flaws and gaps in the proposals
and particularly stressed that implementation is critical. Implementation
is an area where successive governmets have failed. Even the most
well-meant proposals would be of no use if they are not implemented
or implemented properly.
it should be borne in mind that what has been reported so far, especially
the comments from the business chambers, are official reactions
to the budget, which usually are guarded.
is of equal, if not greater, importance are the reactions being
expressed privately. And these are very critical. The biggest concern
appears to be whether this budget stands any chance of being implemented
– either because the ruling party candidate at this week’s
presidential poll gets defeated, in which case the opposition would
want to have their own budget, or because the government lacks the
voting strength in parliament to have the proposals passed after
are doubts whether the ruling coalition would be able to muster
enough votes in parliament to have the budget passed. There is also
much uncertainty about the proposals as some of them have been rather
vague and no dates have been announced for when the proposals take
Fears that this would be an election budget have proved to be overblown.
Nevertheless there have been some very valid criticisms of the budget
instance, the incentives given to encourage companies to relocate
their business in the outstations have been welcomed by the Ceylon
Chamber of Commerce. But they have quite rightly pointed out that
such relocation depends more on the provision of the required support
infrastructure rather than financial incentives.
points out that despite measures to stimulate certain sectors of
the economy, the budget lacks the “vitality” required
to energise the economy.
The chamber still objects to the timing of the budget, its rationale
being that the soon-to-be-elected president should be afforded the
manoeuvrability to implement the vision for which he had received
of the biggest flaws in the budget – as the opposition has
rightly pointed out - is that the budget does not spell out how
the ruling coalition candidate at the presidential poll will implement
all his promises if he wins.
budget was an opportunity for the government to show how the election
promises being made by its presidential candidate can be implemented.
Not doing so is an indication that many of the promises are just
that – promises. But of course, the same can be said of the
opposition UNP’s own candidate as our lead story points out.