Brunei proposes BND5.86 billion budget for financial year 2021-2022

BANDAR SERI BEGAWAN (Borneo Bulletin/ANN) The proposed budget for financial year 2021-2022 is estimated to be BND5.86 billion, similar to the previous financial year (2019-2020).

The government revenue for financial year 2021-2022 is projected to be BND2.61 billion and the nation will record a budget deficit of BND3.25 billion.

This was highlighted by Minister in the Prime Minister’s Office and Minister of Finance and Economy II Dr Mohd Amin Liew Abdullah when deliberating the proposed budget for financial year 2021-2022 at the third day of the 17th Legislative Council (LegCo) session on Wednesday (March 16).

The government revenue for financial year 2021-2022 is projected to be BND2.61 billion whereby revenue from oil and gas sector is projected to be BND1.52 billion and for non-oil and gas sector is BND1.09 billion.

The minister said the country’s revenue is still largely dependent on the oil and gas sector.

The Covid-19 pandemic has affected world oil demand causing oversupply, and in turn affected world oil prices as happened in 2020 where at one point oil prices fell below USD20 per barrel.

Dr Mohd Amin Liew said, at the same time, the country’s hydrocarbon production has also declined. These factors have affected the collection of government revenue to cover government expenditure.

In elaborating on the breakdown of the proposed budget allocation amounting to BND5.86 billion for 2021-2022, the minister said for staff salaries, BND2.02 billion is allocated (equivalent to 34.4 per cent of the total allocation) to finance salaries, allowances and payment of contributions for 65,281 government employees.

Meanwhile, BND2.18 billion (equivalent to 37.3 per cent of the total allocation provided) is allocated for recurrence expenditure. Development Expenditure is allocated BND600 million (10.2 per cent), while the rest is to finance expenses under the heading of Acknowledged Expenses.

As for the government’s fiscal position for the financial year 2019-2020, the minister said the government’s revenue collection decreased by 19.6 per cent to BND4.85 billion, compared to the financial year 2018-2019.

The government’s actual expenditure decreased by 2.1 per cent to BND5.87 billion compared to the financial year 2018-2019. As such, the government has recorded a deficit of BND1.03 billion for the financial year 2019-2020.

For the financial year 2020-2021, as for the government’s fiscal position up to February 28,2021, government revenue collection was BND1.46 billion, a decrease of 57.7 per cent compared to BND3.45 billion for the same period in financial year 2019-2020.

This was due to the fall in world oil prices and the decline in crude oil and liquefied natural gas (LNG) production, which in turn affected the decline in revenue by 69.9 per cent from the oil and gas sector.

In addition, revenue from the non-oil and gas sector has also decreased by 6.6 per cent compared to the financial year 2019-2020.

Meanwhile, the government’s expenditure up to Feb 28,2021 amounted to BND4.44 billion, which is 75.7 per cent of the allocation approved for the financial year 2020-2021.

As such, the government’s fiscal position for the financial year 2020-2021 up to Feb 28,2021 has recorded a deficit of BND2.98 billion. - Borneo Bulletin/Asia News Network