KUWAIT CITY, 1 July 2003 — Kuwait’s Parliament yesterday approved a budget forecasting a 2.27-billion-dinar ($7.56 billion) deficit in fiscal 2003-2004, up 19 percent on the last fiscal year’s estimated shortfall.
Expenditures for the fiscal year that runs from April 1, 2003 to March 31, 2004 were estimated at 5.824 billion dinars ($19.41 billion), up on $18 billion projected for fiscal 2002-2003. Revenues meanwhile were forecast at 3.555 billion dinars ($11.85 billion), up slightly on last year’s estimated $11.74 billion.
By law, 10 percent of revenues, in this case 355.49 million dinars ($1.2 billion), is deducted for the Kuwait Fund for Future Generations, a $60-billion investment managed by Kuwait Investment Authority.
Oil revenues in the budget were calculated on the basis of a conservative price of $15 a barrel. Oil revenues were projected at 2.970 billion dinars ($9.9 billion).
Lawmakers passed the budget with 36 in favor, three against and seven abstentions. Wages for government staff employed in ministries and other state agencies were estimated at $5.5 billion of total expenditures, up on $5.2 billion in fiscal 2002- 2003. MP Ahmed Baqer warned during yesterday’s closing parliamentary session that by 2020, salaries for government employees will reach $23 billion, while liberal MP Abdullah Al-Naibari said spending on salaries was already too high.
Kuwait provides a cradle-to-grave welfare system for its citizens with free or heavily- subsidized services and no income tax. More than 93 percent of the Kuwaiti work force of some 220,000 people is employed by the government.
Allocations for construction and development projects and other forms of capital expenditure were estimated at $2.4 billion, an increase on last year’s $2.2 billion.