The government will take out a total of NT$429 billion (US$13.4 billion) in loans for the next fiscal year to meet a shortfall in budget revenue, which will bring the nation’s total loans to an all-time high of NT$4.7 trillion, according to a Cabinet official yesterday.
“Although accumulated debt is approaching the cap, we will never exceed that,” Minister of Finance Lee Sush-der (李述德) said when asked if the government planned to revise the Public Debt Act (公共債務法), which sets the combined debt ceiling for the central government at 40 percent of average nominal GNP for the previous three years.
The NT$4.7 trillion loan accounts for 37.79 percent of GNP.
Lee made the remarks at a press conference following a Cabinet meeting during which a draft budget statement for next fiscal year was approved.
The Cabinet projected revenue for next year at NT$1.63 trillion and expenditure at NT$1.78 trillion, increasing from NT$1.55 trillion and NT$1.71 trillion respectively this year.
Of the NT$429 billion in loans, NT$159 billion is to meet the deficit between projected revenue and outlay, NT$60 billion is to pay for debt servicing and the remaining NT$204 billion is a special loan to fund public construction and flood-management projects.
Without the special loan, which is not subject to the debt-raising ceiling, loans to be taken out next year account for 12 percent of the outlay, lower than the cap of 15 percent.
Directorate-General of Budget, Accounting and Statistics Minister Shih Su-mei (石素梅) said the government has earmarked NT$3.2 billion for various activities to be held next year to celebrate the Republic of China’s centenary.
Of the government’s total outlay, spending on education, science and culture leads the pack with NT$357.3 billion, or 20 percent, followed by social welfare spending of NT$346.9 billion, or 19.4 percent, defense at NT$287.2 billion, or 16 percent, and economic development spending at NT$225.9 billion or 12.6 percent.
Defense spending accounted for 2.6 percent of GDP, less than 3 percent as promised previously by President Ma Ying-jeou (馬英九).
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