As of first 8 months of 2015, the state budget has fallen short of 600 billion tugrugs. At the end of the year, the number will fluctuate between 900 billion and 1 trillion tugrugs, estimated Ministry of Finance. In relation to the issue, the state budget amendment must be necessarily done prior to approval of 2016 state budget.
Minister of Finance B.Bolor informed at the beginning of “Decision Time” regular meeting held on every Wednesday at PM’s room: “Ministry of Finance advises to submit the budget amendment as one of initial discussions at fall session of parliament”.
“Current state budget was approved in 2014 and amended in January, 2015. During the budget approval and amendment, we made great efforts of working on the budget expenditures. Unfortunately, overall economic situation had become worse than expected at the beginning of the year. Downturn in commodities’ prices had had major impact on the issue. The state budget had extensively grown during 2009-2012, boosted by high commodity prices. Despite certain amendments previously made to reduce the volume, it is inevitable to reduce the state budget again”, said Minister of Finance.
According to the law of Government, we must submit state budget on 1st of October. Despite facing difficult economic situation and budget issues, we must figure out ways to increase budget revenues with efficient management.
“Although revenues coming from copper, gold and coal trading are descending, petroleum price currently drops. During certain short period of time, we have two options to make whether to cut petroleum price or to add budget revenues. During the submission of the budget amendment, we must bring issues of raising excise and other duties on petroleum import in order to create revenues in the budget. The government is obliged to deliver “children’s money”, pension and wages instead of reducing petroleum price. It is major direction we should work towards,” said PM Ch.Saikhanbileg.
Also, other revenue sources including privatization of state-owned entities should be studied in combination with management of flexible tax regulations. During today’s economic difficult situation, it is crucial for state authorities and private sector to cooperate on these matters, added PM.
It is time to cut current expenses into bearable level. I suggest freezing additional spending of foreign and domestic trips, training, meetings, purchasing and other expenses as well as cutting wages of high state officials by 30% in last three months of the year. These matters must be examined immediately and submitted at regular meeting of the government. It is necessary to solve these issues without managing expenses related to social welfare, warned PM.
Even though we planned to increase wages in 2015, we are now forced to move the issue to next year’s budget. Trade Union and Employers’ Association are certain to resist and negatively react to the decision. In relation to this matter, Minister of Labor G.Bayarsaikhan should establish trilateral negotiation with Trade Union and Employers’ Association and reach mutual agreement.
Moreover, it is important to take into account in 2016 state budget whether target groups earn social welfare benefits.
Also, not only state officials but also private sector entities should consider of giving up additional wages at the end of the year, and be initiative over reducing expenditures and cutting additional spending, said PM Ch.Saikhanbileg.
Minister of Finance added: “Ministry of Finance will make full efforts in order to manage tax regulations efficiently and increase revenues. Without adding burdens on shoulders of taxpayers, we will work on 2015 budget amendment and 2016 state budget according to PM’s instructions.”
Press and Public Relations Bureau of Government of Mongolia.
As of first 8 months of 2015, the state budget has fallen short of 600 billion tugrugs. At the end of the year, the number will fluctuate between 900 billion and 1 trillion tugrugs, estimated Ministry of Finance. In relation to the issue, the state budget amendment must be necessarily done prior to approval of 2016 state budget.
Minister of Finance B.Bolor informed at the beginning of “Decision Time” regular meeting held on every Wednesday at PM’s room: “Ministry of Finance advises to submit the budget amendment as one of initial discussions at fall session of parliament”.
“Current state budget was approved in 2014 and amended in January, 2015. During the budget approval and amendment, we made great efforts of working on the budget expenditures. Unfortunately, overall economic situation had become worse than expected at the beginning of the year. Downturn in commodities’ prices had had major impact on the issue. The state budget had extensively grown during 2009-2012, boosted by high commodity prices. Despite certain amendments previously made to reduce the volume, it is inevitable to reduce the state budget again”, said Minister of Finance.
According to the law of Government, we must submit state budget on 1st of October. Despite facing difficult economic situation and budget issues, we must figure out ways to increase budget revenues with efficient management.
“Although revenues coming from copper, gold and coal trading are descending, petroleum price currently drops. During certain short period of time, we have two options to make whether to cut petroleum price or to add budget revenues. During the submission of the budget amendment, we must bring issues of raising excise and other duties on petroleum import in order to create revenues in the budget. The government is obliged to deliver “children’s money”, pension and wages instead of reducing petroleum price. It is major direction we should work towards,” said PM Ch.Saikhanbileg.
Also, other revenue sources including privatization of state-owned entities should be studied in combination with management of flexible tax regulations. During today’s economic difficult situation, it is crucial for state authorities and private sector to cooperate on these matters, added PM.
It is time to cut current expenses into bearable level. I suggest freezing additional spending of foreign and domestic trips, training, meetings, purchasing and other expenses as well as cutting wages of high state officials by 30% in last three months of the year. These matters must be examined immediately and submitted at regular meeting of the government. It is necessary to solve these issues without managing expenses related to social welfare, warned PM.
Even though we planned to increase wages in 2015, we are now forced to move the issue to next year’s budget. Trade Union and Employers’ Association are certain to resist and negatively react to the decision. In relation to this matter, Minister of Labor G.Bayarsaikhan should establish trilateral negotiation with Trade Union and Employers’ Association and reach mutual agreement.
Moreover, it is important to take into account in 2016 state budget whether target groups earn social welfare benefits.
Also, not only state officials but also private sector entities should consider of giving up additional wages at the end of the year, and be initiative over reducing expenditures and cutting additional spending, said PM Ch.Saikhanbileg.
Minister of Finance added: “Ministry of Finance will make full efforts in order to manage tax regulations efficiently and increase revenues. Without adding burdens on shoulders of taxpayers, we will work on 2015 budget amendment and 2016 state budget according to PM’s instructions.”
Press and Public Relations Bureau of Government of Mongolia.