The net out payment on Advance Account Activities is expected to be Rs. 2.0 billion. These expenditure figures do not include certain items of expenditure for which Parliamentary approval has already been granted under various laws, such as those on Repayment of Public Debt, Payment of Interest on Public Debt, Pensions Payments etc., amounting to Rs. 313.8 billion.

Therefore, the total expenditure that has to be incurred during the year 2004 will be Rs. 668.6 billion. The total receipts of the Government, including the revenue and foreign grants, is estimated to be Rs. 356.1 billion. Therefore, the total gross borrowing requirement from both domestic and foreign sources will be Rs. 312.5 billion for 2003.

According to the revenue forecast, the impact of the economic growth experienced in the recent past on the tax revenue will not be seen in the immediate future. At present only a modest increase of revenue is expected in 2004 as compared with the 2003 revenue estimate.

Hence, the Government has to fix the expenditure limit at a relatively lower level than most Spending Agencies would expect. Such a measure has become extremely necessary as the Government is bound to bring down the budget deficit to 5% of GDP and the Public Debt stock to 85% of the GDP in 2006, pursuant to the enactment of the Fiscal Management (Responsibility) Act No. 3 of 2003, the Finance Minister said.

Maintaining a lower Budget deficit and thereby a lower interest rate and inflation would enable more resources to be made available for investment - a sine qua non for private sector led growth.

The benefits of lower inflation will be enjoyed mostly by the lower income groups as they would be adversely affected by the increase in the cost of living.

Parliamentary approval is sought by this Bill to incur a total expenditure of Rs. 352.7 billion consisting of Rs. 209.1 billion on recurrent expenditure and Rs. 143.6 billion. on Capital Expenditure. The net out payment on Advance Account Activities is expected to be Rs. 2.0 billion. These expenditure figures do not include certain items of expenditure for which Parliamentary approval has already been granted under various laws such as those on Repayment of Public Debt, Payment of Interest on Public Debt, Pensions Payments etc., amounting to Rs. 313.8 billion. Therefore the total expenditure that has to be incurred during the year 2004 will be Rs. 668.6 billion. The total receipts of the Government including the revenue and foreign grants is estimated to be Rs. 356.1 billion. Therefore, the total gross borrowing requirement from both domestic and foreign sources will be Rs.312.5 billion. for the year 2004.

In order to meet any shortfall of provision allocated to Spending Agencies, specially for the implementation of donor funded projects, it has been the practice to keep a provision in the Miscellaneous Vote of the Department of National Budget of the General Treasury.

When an allocation is granted from this Miscellaneous Provision, it does not correctly reflect the expenditure "of the recipient agency as Parliament has approved this provision under the Department of National Budget. In the circumstances, I wish to include a provision in the Appropriation Bill for 2004 to treat such special allocations given by the Treasury as sums approved in terms of supplementary estimates at the instance of the respective minister, so that such expenditure can be recorded under the recipient Ministry.

The draft of the Appropriation Bill incorporating the proposal referred to above has been approved by the Legal Draftsman. The Attorney-General has stated that the provisions of the Draft Bill are not inconsistent with the Constitution and the Bill is not subject to any prohibition or restriction imposed by the Thirteenth Amendment to the Constitution, the newspaper added.