TAIPEI: Lawmakers in Taiwan approved on Friday (Aug 14) the government's annual budget for 2026 after a record delay, and shortly before the parliament is expected to receive next year's spending proposal for review.
President Lai Ching-te's government and his Democratic Progressive Party (DPP) have been at loggerheads with opposition parties, which hold the most seats in parliament, over general spending, particularly on the island's defence.
The government said last August that overall expenditure for 2026 was budgeted at just over NT$3 trillion (around US$94 billion) -- up NT$110 billion or around 3.8 per cent from 2025.
Opposition lawmakers agreed on Friday to cut this year's budget by NT$48 billion, or around 1.6 per cent -- nearly eight months after the government's spending plan was supposed to be approved.
This is the longest it has ever taken parliament to pass an annual general budget, and comes days before the government plans to announce its 2027 expenditure plan next Thursday.
The parliament is likely to receive the 2027 budget for review by the end of August.
Caucus leader for the main opposition party Kuomintang (KMT), Fu Kun-chi, said the number of proposed amendments to this year's budget was reduced from more than 1,700 to a final 40-50, demonstrating the parliament's "utmost goodwill".
"I have devoted myself wholeheartedly to this effort, hoping that the nation can move forward and the people can lead better lives," Fu said in a statement.
In a social media post later Friday, Lai noted the "numerous unreasonable cuts and freezes" to the budget.
"In addition to a total cut of NT$48 billion, funding for policy promotion has been significantly reduced, and there have been freezes on funding for the normal operations of government agencies, and the salary of the head of the executive branch," Lai said, referring to the premier.
Annual budget approval delays in Taiwan do not result in a government shutdown because the previous year's expenditure plan is automatically applied for the current year, allowing existing programmes to continue to operate.
Opposition lawmakers blamed Lai's government for the delay in approving the 2026 budget, saying it had not earmarked funding for military pay rises and higher pensions for police officers and firefighters.
Much of the bickering between the government and the opposition has been over defence spending.
Lai's government is under intense US pressure to cough up more to protect itself against the growing threat from China, which claims the island is part of its territory and has threatened to use force to annex it.
Lai had vowed to increase defence spending to more than three per cent of GDP this year and five per cent by 2030.
The president's ambitious plan to allocate $40 billion in special funds for US weapons purchases and domestic drone procurement over several years was thwarted by the KMT and the Taiwan People's Party, which instead passed a $25 billion budget in May.
The parliament is now considering rival proposals for billions of dollars in drone investment. - AFP
