Tuesday,21 November, 2017
Current issue | Issue 1302, (30 June - 13 July 2016)
Tuesday,21 November, 2017
Issue 1302, (30 June - 13 July 2016)

Ahram Weekly

Not enough for hospitals and schools?

Proposed spending on healthcare and education in the country’s new budget are so low that the budget risks being found unconstitutional, writes Hayat Hussein

Not enough for hospitals and schools?
Not enough for hospitals and schools?
Al-Ahram Weekly

The sums allocated to healthcare, education and scientific research in the country’s new budget are minimal. This in contrast to the government’s plan to increase spending on infrastructure projects. Debt repayments, salaries and subsidies will claim 31 per cent, 24 per cent and 22 per cent, respectively, of the expenditure side of the new budget.

 The insufficient funds have triggered a debate in parliament on the 2016-2017 budget, with some claiming that the amounts allocated to social welfare fields are below constitutional requirements.

The constitution obliges the government, starting from the 2016-2017 financial year, to assign four per cent of GDP to education, two per cent to higher education, three per cent to healthcare and one per cent to scientific research.

Minister of Planning Ashraf Al-Araby said the expected GDP for the new financial year is LE3.2 trillion. Based on this amount, the allocations for healthcare, education and research should be increased by at least LE61 billion, according to research conducted by the Egyptian Initiative for Personal Rights (EIPR), an NGO.

The majority of MPs agree with the government when it says that its “hands are tied” on expanding expenditure for these sectors because of weaker than expected revenues of LE628 billion, however.

Mohamed Maeet, a deputy to the finance minister, said the government cannot do any better than it has in making the allocations. Yasser Omar Sheba, a member of the parliament’s budget committee, told Al-Ahram Weekly that because 80 per cent of the expenditure is mandatory, the government cannot increase healthcare and education spending.

Despite this, the government has agreed to increase expenditure by LE38 billion: LE28 billion for social housing and LE10 billion for education and scientific research.

Article 124 of the constitution gives the House of Representatives the right to reallocate some spending. If this results in increasing overall expenditure the government must cooperate with the parliament to find revenue sources.

The budget was still being discussed in parliament as the Weekly went to press. Parliament is supposed to approve the budget on Wednesday 29 June.

Among the measures the cabinet has offered to circumvent the problem is to calculate the allocations according to the GDP of the current year, equivalent to LE2.8 billion, rather than of next year, or LE3.2 billion. This would have the effect of reducing the allocations.

Another suggested compromise is including health-related spending under the Ministry of Health budget in order to increase the value of the allocation. This would mean moving provisions for water treatment from the Housing Ministry to the Health Ministry, classifying them as “preventive medicine”.

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