· EGP 257.7 billion increases in allocations for education and health sectors - the highest unprecedented budget ever.
· 42% increase in investments financed by the General Treasury, to amount up to EGP 100 billion.
· EGP 3.5 billion allocated for supplying natural gas to households.
· EGP 194 billion allocated for subsidy programs, EGP 69 billion for pension funds.
· EGP 1 billion allocated for providing baby formulas, and EGP 5.7 billion for citizen treatment at the State's expense.
Finance minister, Dr. Mohammed Maait, has recently announced the implementation of the new budget for the 2018/19 fiscal year with a total of EGP 1.42 trillion in expenditures, an increase of EGP 200 billion from last year.
Dr. Maait says in a statement that the such increase in this year's budget is due to increases in allocations for programs enclosing social dimensions such as state employees' salaries that are risen by EGP 30 billion to reach EGP 270 billion. He adds that the budget includes a monthly increase of EGP 265 in wages for the public sector to meet price hikes caused by cuts in fuel subsidies and by other austerity measures.
Government investments financed by the General Treasury have increased by 42% from the previous fiscal year, reaching about EGP 100 billion against EGP 70 billion in the 2017/18 budget, according to the statement.
All arrangements have been made by the Ministry of Finance to embark on the new budget, confirms Dr. Maait. Required allocations have been transferred from the entities included in the budget for the first month of the new fiscal year. Strict instructions are also issued underlining the importance of abiding by expenditure rationalization, not exceeding the set allocations for public entities, and tightening control over public expenditure.
The implementation of the new general budget coincides with the new presidential term of President Al-Sisi; and thus sets to reflect his directives to the government, especially with respect to means of increasing economic growth rates. Over the new fiscal year 2018/19, economic growth rates are forecast to be around 5.8%, by 6.5 to 7 percent increase on the mid-term, which would accordingly support the government and the Central Bank of Egypt's plans to curb down inflation rates to less than 10%.
In compliance with President Al-Sisi directives, that the new budget includes an unprecedented increase in allocations for education and health sectors, reaching EGP 257.7 billion compared to EGP 222 billion last fiscal year.
Dr. Maait says that EGP 98.7 billion are allocated to the health sector, EGP 108 billion to pre-university education, and EGP 51 billion to higher education.
To succeed in carrying out revenue-increasing plans, the ministry will work on enhancing the State resources. This shall be achieved by increasing contributions of non-sovereign sectors in tax proceeds, tightening control over the said sectors, incorporating non formal sectors in economy, combating tax evasion, expanding automation techniques and in particular those related to receiving tax returns and processing their electronic monitoring, adds Dr. Maait.
Dr. Maait also confirms that the new general budget will continue considering top priorities for public expenditure in order to achieve more financial excess funds by mid-term and to increase general expenditure on economic and social development projects to improve services for citizens.
With respect to new items in the this year's budget, Dr. Maait says that allocations worth EGP 5.7 billion are designated for treatment at the State's expense against EGP 4.6 billion last fiscal year. In addition, EGP 1.5 billion are allocated for paying contributions of the under-privileged in the health insurance system, EGP 69 billion for pension funds with a 6.5% increase compared to prior year, EGP 13.4 billion against EGP 9.8 billion for pharmaceuticals procurement. Funds are also allocated for student health insurance, breadwinner women, pre-school age children and social insurance pension.
In the new budget, allocations for different product subsidy programs totaled nearly EGP 194.315 billion: EGP 86.175 billion for subsidy of supply products, EGP 89.075 for petroleum products against EGP 110 billion in prior year, EGP 16 billion for electricity, EGP 1 billion for pharmaceuticals and baby formulas and EGP 1 billion for water companies. Moreover, 192% increases occurred in allocations for projects of supplying natural gas to households, to reach EGP 3.5 billion against 1.2 billion in fiscal year 2017/18.
Dr. Maait also notes that the budget includes as well subsides and grants to development sectors by EGP 1.065 billion in order to support development projects in Upper Egypt, interests of soft loans, rapid transit vehicle fund, in addition to allocating EGP 4 billion for boosting exports.