Minister of Education Cheng Jei-cheng (鄭瑞城) grabbed attention when he recently worried that the Ministry of Education might not be able to spend all of its budget. This shows how preposterous our budget policies are. Common sense tells us that to be able to plan a budget, expenditures should be determined before allotting the budget. Only then can it be decided what the appropriate amount is for each item and which projects are more important. Township governments are familiar with this process because they need to follow it when requesting funds from the national, city or county government to build infrastructure such as parks and stadiums.
However, the truth is that the central government works in the opposite way — it first receives money and then decides how to spend it. Small wonder that Cheng worries about not being able to spend all his funding. The NT$500 billion (US$14.67 billion), four-year special budget to increase infrastructure spending is a classic example of this backward planning. This program is exactly the same as the previous plan for increasing domestic consumption.
Such counterintuitive planning does not work. Nationwide, roads are always being repaired, but never fixed. In addition, political infighting has long meant that northern Taiwan is emphasized over the south. The main point is that these plans fail to deliver the promised growth.
The government has seized the economic crisis to justify using the national treasury like an ATM and issuing debt for the NT$500 billion infrastructure budget, since it must take extreme measures to save the economy during the worst global recession in a century.
The problem is that while the Cabinet asked the Council for Economic Planning and Development to report on Friday how the NT$500 billion would be spent, the council and the Directorate-General of Budget, Accounting and Statistics said last Tuesday that they had yet to receive the budget plans from the ministries. When questioned, the ministries said the budgets were still being worked out and their bosses had not even seen the plans.
A reasonable guess is that Cheng is worrying that his ministry will not be able to spend its budget because it has no idea what to do with the money.
Amazingly, by midday on Tuesday, just a few hours before the council was to hold its budget meeting, two days before the Cabinet’s deadline and two weeks before the legislature’s budget review, nobody knew how this much-anticipated budget would be spent.
Experience shows that the end result will be a rush job of rash policies. How can anyone expect this money to be spent where it is most needed or that it will boost the economy?
It is not the first time the government has planned something like the special budget to expand domestic demand or the NT$500 billion infrastructure budget. Who knows how many projects actually developed from past government plans to save the economy? These grandiose plans were also announced before ministries had worked out the details. While news of the policies made headlines, weeks later the details revealed that they were just repackaged versions of old policies.
Both the public and industry are suffering while a paralyzed government plays with slogans, unable to come up with any substantive policies. All we get is news about purported policies, which ensures that reporters still have jobs, but does little for anyone else.
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