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2009 MINI-BUDGET PERFORMANCE

2009 MINI-BUDGET PERFORMANCE. Elias Baingana Director General of National Budget. Presentation Outline. Background Resources Expenditures Deficits and Financing Conclusion. Background.

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2009 MINI-BUDGET PERFORMANCE

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  1. 2009 MINI-BUDGET PERFORMANCE Elias Baingana Director General of National Budget

  2. Presentation Outline • Background • Resources • Expenditures • Deficits and Financing • Conclusion

  3. Background • The budget approved estimated total revenue and grants at RWF 368.4 bn and total expenditure and net lending at RWF 352.7 bn projecting a surplus (including grants) of RWF 15.6 bn. • The approved Budget was revised early in the year to accommodate some priority expenditures including the military operations in the DRC. • As a result, total revenue and grants were marginally projected downwards to RWF 354 bn. Total expenditure and net lending was slightly revised upwards to RWF 358.8 bn. • The overall balance (including grants) which was originally projected to register a small surplus was now estimated to close with a small deficit of RWF 5.8 bn.

  4. Background • Despite adverse external economic conditions, budgetary performance did not deviate greatly from the revised estimates. • Total Revenues and Grants were RWF 25.3 bnless than the revised estimates. • Total Expenditure and Net Lending was RWF 7.9 bnlower than the revised estimates. • The overall deficit (excluding grants) was RWF 6.4 bnlower than the projected amount of RWF164.7 billion. • Primarily due to a shortfall in budget support grants, the overall deficit (including grants) was RWF 17.4 bnhigher than the projected estimate.

  5. Resources • Domestic Resources: • Tax revenues performed marginally better than expected with excess collections of RWF 5.5 bn (103.1% execution rate). • Non tax revenues were RWF 7 bn lower than projected (58.8% execution rate). The shortfall was mainly due to delays in the accrual of the fertilizer and Identity cards sales receipts. • External Resources: • Budget support disbursements registered a shortfall of RWF 23.8 bn as compared to the revised figures. • Project loans and Grants budgets were revised due to new information becoming available. Out of the projected RwF 68.9 bn, RwF 34.6 billion was received through cash disbursements and direct payments are estimated to account for the remaining RwF 34.3 bn.

  6. Expenditures • Total Expenditure and Net Lending remained within the projected limits (by RWF 6.9 bn) • The total recurrent expenditures were under-spent by about RwF 13.6 bn. • Capital expenditures were almost exactly equal to projections – an under-spend of just RWF 0.9 bn. • Actual Net Lending of RWF 10 bn was above the projected level of RWF 3.4 bn by RWF 6.6 bn.

  7. Deficits and Financing • The revised budget projected an overall deficit (including grants) of RwF 5.8 bninstead of a surplus of RwF 15.6 bn as originally projected. • The overall deficit (including grants) at RWF 23.2 bnwas RWF 17.4 bnhigherthan the projected figure. • Due to the above developments, the cash needs of the Government rose to RWF 27.6 bn; • This was financed by RWF 34.1 bn drawdown of project loans plus an additional draw down of RWF 2.1 bn of Government deposits;

  8. 2009 Budget Execution by Economic Inputs • Total expenditures were lower for all categories except Net Lending; • The biggest under spending was on transfers and subsidies mainly due to BNR transfers; • The over-spending on Net Lending was mainly due to replenishment of the Strategic Stocks of petroleum products; • Despite the shortfall in total spending, the target of priority expenditures was met.

  9. 2009 Budget Execution by Function • Total primary outlays during the first half of 2009 amounted to RWF 294.7 bn. • Education took largest share; RwF 54.4 bn or 18.5%. • Key expenditures were the following: • Wages and salaries for teachers. • Capitation grant for primary schools and “TroncCommun”. • School Feeding and scholastic materials. • Schools construction and repairs. • Transfers for cost-sharing as well as external scholarships. • Vocational and technical training.

  10. 2009 Budget Execution by Function • Other Gov’t Services took RwF 46.6 bn or 15.8%. • Key expenditures were the following: • Transfers for running costs for Good Governance and Economic Management institutions. • Issuance of new national identity cards and driving permits. • Debt repayment and interest costs. • Subscription and membership costs. • Funding the activities of the Electoral Commission.

  11. 2009 Budget Execution by Function • Legislative and Executive Organs took RwF 34.7 bn or 11.8%. • Key expenditures were the following: • Inter-Governmental transfers to districts. • Transfers to the Community Development Fund (CDF). • Management support to the legislative institutions. • Transfers for salaries and running costs of diplomatic missions.

  12. 2009 Budget Execution by Function • Defence expenditures took about RwF 34.5 bn or 11.7%. • PKO and demobilization costs are significant components. • Key expenditures were the following: • Running costs for the military institutions. • Peace keeping operations in Sudan. • Reintegration and demobilization costs. • Internationally agreed DRC operation.

  13. 2009 Budget Execution by Function • Transport and Communication took RwF 23.9 bn or 8.1%. • Key expenditures were the following: • Construction of Kicukiro-Kirundo road. • Rehabilitation of Ruhengeri-Gisenyi road. • Construction and rehabilitation of road networks. • Provision of ICT infrastructure. • Feasibility study of the new Bugesera Airport

  14. 2009 Budget Execution by Function • Public Order and Safety took RwF 16.8 bn or 5.7%. • Key expenditures were the following: • Running costs for the National Police and Prison Services. • Purchase of equipments for the National Prison Service. • Rehabilitation of prisons.

  15. 2009 Budget Execution by Function • Health sector took RwF 20.3 bn or 6.9%. • Key expenditures were the following: • Transfers to district health centres and hospitals for: • Health workers’ salaries. • Purchase of drugs and vaccines. • Purchase of medical equipment. • Subsidy for “Mutuelle” insurance scheme for the indigents. • Support to the contractual approach to community health (PBF). • Pooling risk for health insurance scheme.

  16. 2009 Budget Execution by Function • Fuel and Energy took RwF 18.0 bn or 6.1%. • Key expenditures were the following: • Construction of Rukarara and Nyabarongo hydro-power stations. • Rural electrification program. • Lake Kivu gas project. • Purchase of HFO and payment for fuel import subsidies. • Rehabilitation of Mkungwa, Gihira and Gisenyi power stations. • Construction of Kigali–Kiyumba Electrical line.

  17. 2009 Budget Execution by Function • Agriculture took RwF 18.3 bn or 6.2%. • Key expenditures were the following: • Importation of fertilizers. • Purchase of improved seeds. • Extension services. • Research projects. • One cow per family project. • Irrigation project.

  18. 2008 Budget Execution by Function • Water and Sanitation took RwF 4.1 bn or 1.4%. • Key expenditures were the following: • Rural clean water supply and sanitation projects. • Clean water supply to Kigali from underground sources. • Studies for clean water supply in districts.

  19. 2009 Budget Execution by Function • Social Protection took RwF 8.8 bn or 3.0%. • Key expenditures were the following: • Transfers to the Genocide Survivors Assistance Fund (FARG). • Support to Orphans and other vulnerable groups. • Resettlement of returning refugees.

  20. 2009 Budget Execution by Function • Industry and Commerce took RwF 6.4 bn or 2.2%. • Key expenditures were the following: • Transfers for running costs of autonomous agencies (RDB). • Free trade zone construction. • Support to rural micro-finance and small and medium scale enterprises.

  21. 2009 Budget Execution by Function • Land Housing and Community Amenities took RwF 2.3 bn or 0.8%. • Key expenditures were the following: • Running costs for the Land Registration Agency. • Compensation for demolished dwellings. • Preparation of settlement sites (Viabilization et Bornage)

  22. 2009 Budget Execution by Function • Environment Protection took RwF 1.6 bn or 0.5%. • Key expenditures were the following: • Running costs for REMA. • Rehabilitation and protection of river banks and lake shores. • Biodiversity and Landscape protection in districts of Northern Province.

  23. Conclusion • It had been projected that the international financial crisis would impact negatively on the mini-budget execution. • This was to be felt by pressures on expenditures whilst reducing revenue collections. • This did not happen, and the fiscal targets were broadly met as planned. THANK YOU

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