(MENAFN- Muscat Daily) Oman unveiled a record budget, proposing public expenditure of RO13.5bn for 2014. This is up five per cent from last year.
While continuing to focus on social-sector requirements, major investment projects and economic diversification, the government slowed the pace of spending growth this year. The growth in planned public spending was 29 per cent in the 2013 budget.
Total revenues are estimated to be RO11.7bn, leaving the government with a budget deficit of RO1.8bn. State revenues, which are up 4.5 per cent from last year, have been calculated based on an average oil price of US$85 per barrel.
Current expenses of about RO8.7bn will account for 65 per cent of total public spending, while salaries and wages, amounting to RO5bn, represent nearly 37 per cent of the total.
Announcing the budget at the Ministry of Finance on Thursday, H E Darwish al Balushi, Minister Responsible for Financial Affairs, said that investment expenditure of nearly RO3.2bn, or 24 per cent of overall public spending, will cover spending on development projects and capital expenses for production of oil and gas; while subsidy expenses have been estimated at RO1.4bn.
He said that the budget includes allocations of about RO9.2bn to meet social requirements in education, health, housing, training, subsidy and other social services, compared to RO8.7bn in last year's budget, an increase of RO465mn or 5.3 per cent.
The major allocations include: RO2.6bn for education sector; RO1.3bn for health sector; RO2.8bn for housing; subsidies and exemptions of RO1.8bn, which include subsidies for interest on housing and development loans, electricity, water, fuel and some basic food commodities; RO95mn for training programmes; and, RO133mn for social security to cover pensions and social welfare.
On investment projects, H E Balushi said, ''The projects which the government will execute - either directly or through government-owned companies - in 2014 bear opportunities to stimulate private-sector activity in the sultanate, as well as to generate a lot of new jobs.''
Among the major projects to be executed in 2014 are the refinery and petrochemical factory at Duqm, the Sohar Refinery
expansion, construction of a factory for assembling and manufacturing buses in the sultanate in cooperation with Qatari Transportation Co, completion of the convention centre project with hotels and a new commercial complex, execution of a number of tourism projects such as hotels executed by Omran and also projects related to the fishing sector.
The minister added that the government will continue spending on many ongoing projects. These include: Phase one of the railway project at an estimated cost of RO1bn; and road projects at a cost of RO807mn that include dualisation of the Bidbid-Sur road, Barka-Nakhal road, Diba-Lima-Khasab as well as phase one of the dualisation of the Adam-Thumrait road.
H E Balushi said that oil prices are likely to sustain at current levels in 2014, and ''therefore, we expect to end up covering the deficit, if not with a surplus in 2014. However, in case of unexpected developments [regarding oil prices] during the year, the government will revisit the
expenditure taking into consideration the priorities of the government and impact on the economy.''
The minister noted that execution of the Royal Directive on standardising grades and salaries for employees of the civil sector will cost the government an estimated RO800mn-RO900mn, but has not been included in the budget estimates.<
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