Sri Lanka Brief
NewsDefence budget tops the list; How Sri Lanka wants to spend its money next year.

Defence budget tops the list; How Sri Lanka wants to spend its money next year.

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Despite the end of the separatist war, defence expenditure continues to draw the highest allocation of funds in successive budgets.

The Appropriation Bill, approved by the Cabinet of Ministers and due to be presented in Parliament next week by Finance Minister Mangala Samaraweera, records a commitment of Rs 260,711,375,000 as recurrent expenditure for the Ministry of Defence. The capital expenditure, however, is at Rs 30 billion.

The higher commitments are the result of Sri Lanka’s security apparatus expanding with the addition of new institutions over the years and the resultant updating of equipment. Yet, the sum is lower than the Rs 284 billion allocated in the previous years. In the Appropriation Bill for 2017 presented by then Finance Minister Ravi Karunanayake, an allocation of Rs 1,819 billion (Rs. 1.8 trillion) was the estimated expenditure requirements. Of this amount Rs 1,208 billion was the total recurrent expenditure while the total capital expenditure was Rs 610 billion.

The Appropriation Bill is a piece of legislation in Parliament seeking authorisation for the Government to spend money. It sets aside money for specific spending.

Of the amount allocated for the Minister of Defence (a portfolio held by the President), a sum of Rs 4,973,062,200 (Rs. 4.9 billion) as recurrent expenditure for “Operational Activities” and a further Rs 4,789,167,000 for “Development Activities” as capital expenditure. Here is a breakdown of allocations for the armed forces:

Operational Activities – Sri Lanka Army – Recurrent Expenditure Rs 149,536,395,000. Capital Expenditure Rs 6,987,328,000.
Operational Activities – Sri Lanka Navy – Recurrent Expenditure Rs 50,368,948,000. Capital Expenditure Rs 7,108,621,000.
Operational Activities – Sri Lanka Air Force – Recurrent Expenditure Rs 36,512,600,000. Capital Expenditure Rs 6,687,837,000.
Operational Activities – Department of Civil Security – Recurrent Expenditure Rs 17,268,120,000. Capital Expenditure Rs 315 million.
Operational Activities – Department of Sri Lanka Coast Guard – Recurrent Expenditure Rs 38,250,000. Capital Expenditure Rs 53,200,000.

The second highest allocation is to the Ministry of Finance and Mass Media. The Recurrent Expenditure is Rs 196,517,853,000 and Capital Expenditure Rs 37,054,235,000. Other higher allocations include:

The Ministry of Health,Nutrition and Indigenous Medicine – Recurrent Expenditure Rs 134,399,998,000. Capital Expenditure Rs 44 billion.

The Ministry of Transport and Civil Aviation – Recurrent Expenditure Rs 118,176,198,000. Capital Expenditure Rs 14,867,350,000.

The Ministry of Foreign Affairs – Recurrent Expenditure Rs 9,956,950,000. Capital Expenditure Rs 14,867,350,000.

The Ministry of Higher Education – Recurrent Expenditure Rs 32,757,000,000. Capital Expenditure Rs 150 billion.

The Appropriation Bill for the Financial Year 2018 makes provisions for expenditure estimated as Rs 1,997,264 million. It consists of Rs 1,308,939 million for recurrent expenditure and Rs 668,324 million for capital expenditure.

In addition, Minister Samaraweera has said, provisions have been made under special laws to service public debt and payment of Widows and Orphan Pension etc, amounting to Rs 2,005,103 million. The provision requirement for Advance Account Activities is Rs 6,000 million. “Hence, the total expenditure provision for 2018 without budget proposals to be introduced at the Second Reading of the budget is estimated at Rs 3,982,367 million. The revenue at the prevailing rate structure and foreign grants has been estimated to be around Rs 2,175,000 million. Therefore, the total borrowing requirement from both foreign and domestic sources will be Rs 1,813,367 million,” Minister Samaraweera has added.

(Excerpts  courtesy of The Sunday Times)

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