Lower House deliberations on draft state budget law expected to start next week

AMMAN – Deputies are expected to start deliberations over the draft 2015 state budget law next week, the head of the Lower House Financial Committee, Yousef Qorneh, said Wednesday.

Qorneh told The Jordan Times that the committee has concluded its report on the budget bill and will present it to the Lower House Permanent Bureau to include the law on next week’s agenda. 

The MP said the panel has completed its discussions, which lasted around two months, with all government agencies and ministries over their expenditures. 

Responding to a question on whether controversial assumptions related to oil prices and power tariffs would be amended during the debate, Qorneh said the House will most likely reject the government’s assumption related to preparing the draft state budget law on an average global oil price of $100 per barrel. 

The committee believes the assumption is no longer valid as international oil prices have dropped to around $50 a barrel, he noted, adding that the budget should be based on the price of $80 per barrel.

Observers and MPs expect tensions to surface between lawmakers and the government during deliberations on the draft law due to differences over electricity tariffs. 

Power tariffs went up by 15 per cent as of the beginning of this year — an automatic government measure until 2017 — in order to address losses of the state-owned National Electric Power Company, which has been relying heavily on fuel oil to generate power for almost four years as a result of the halt in natural gas supplies from Egypt. 

But as crude oil prices have dropped, MPs called for freezing the rate increase, a proposal the government turned down but agreed with a joint Lower House panel to slash by half. 

When voting on the agreement between the joint panel and the government last month, MPs insisted on zero increase.  

The government has estimated a budget deficit of JD688 million after foreign grants compared with JD911 million forecast on the 2014 balance sheet. The ratio of the deficit to the gross domestic product would be around 2.5 per cent this year.

The government put the size of this year’s budget at JD8.09 billion, with the value of current expenditures estimated at JD6.922 billion, an increase of 2.9 per cent, or JD193 million, from 2014. The rise was attributed to the routine annual increase in the salaries of civil servants, and army and security personnel.

Capital spending in 2015 is estimated at JD1.175 billion, an increase of JD59 million from 2014, of which JD510 million will be covered by the Gulf Cooperation Council grant to Jordan.