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Budget allocation furor escalates

The wrangling over the central government's annual budget allocation continued as Kaohsiung Mayor Chen Chu (陳菊) yesterday said it would be a tall order for her to stump for fellow Democratic Progressive Party (DPP) candidates in next year's elections if the central government goes ahead with its plan to have Taipei County share the tax revenues originally set aside for Taipei and Kaohsiung cities.

The Executive Yuan came up with the plan after the opposition-controlled Legislative Yuan passed an amendment to the Law on Local Government Systems (地方制度法) on May 5, which stipulates counties with populations of more than 2 million would qualify to become special municipalities.

As a result, Taipei County, which has a population of more than 3.7 million, is now eligible for special municipality status, giving it access to greater budget resources and entitling it to a share of the budget allotted to the Taipei and Kaohsiung city governments.

The Ministry of Finance estimated that this would cause a NT$18.3 billion (US$555 million) annual shortfall for the Taipei City Government and a NT$11.1 billion cut to Kaohsiung City's budget.

Chen and Taipei Mayor Hau Lung-bin (郝龍斌) petitioned Premier Chang Chun-hsiung (張俊雄) several times last week over the matter.

Chen said on Friday that as mayor, she would be ashamed to face the city council if she was unable to safeguard the city government's budget allocation.

Chen continued her opposition to the Cabinet's decision to allow Taipei County to share the budget yesterday when she said she might not head DPP presidential candidate Frank Hsieh's (謝長廷) Kaohsiung campaign.

"If the government fails to take care of the budget, I think the decision may undermine Kaohsiung residents' trust in the DPP," she said. "If the problem cannot be resolved, I don't see how I can campaign [for Hsieh]."

The budget decrease could contribute to a widening regional development gap, Chen said, saying public construction projects in Kaohsiung may have to be halted as a result of any reductions in the budget.

She urged the Cabinet to formulate a new set of policies and push through related legal amendments before it finalized the budget allocation.

overhaul

Later in the day, Chen Chu met with President Chen Shui-bian (陳水扁), who was visiting the Daoist Pao-An Temple in downtown Kaohsiung with Vice President Annette Lu (呂秀蓮), at a lunch organized by a civic group.

Chen Chu told the president that the current budget allocation system should be completely overhauled, instead of simply giving Taipei County a share of the tax revenues originally designated for Taipei and Kaohsiung cities.

"If Kaohsiung City's budget is abruptly cut by NT$11 billion, the city government will have a hard time continuing its development projects and welfare services for the disadvantaged," Chen Chu was quoted as having told the president.

DPP Legislator Lee Kun-tse (李昆澤), who accompanied the president on a community outreach tour yesterday, said that even though the Cabinet has proposed appropriating an additional NT$7 billion for the city, Lee said the amount was not enough to help the city government make ends meet.

support

If the central government fails to deal with the budget allocation issue properly, Lee said he was afraid the DPP could lose the support of Kaohsiung City residents and even those in other cities and counties in southern Taiwan, which has traditionally been the DPP's stronghold.

At a separate setting, Hau and Taipei County Commissioner Chou Hsi-wei (周錫瑋), both members of the Chinese Nationalist Party (KMT), joined the criticism of the central government over issue.

amendment

Hau said that the city government, in an effort to solve the issue, would present a draft of an amendment to the Law Governing the Allocation of Government Revenues and Expenditures (財劃法) next month.

Chou said the Taipei County Government would not accept the current tax redistribution measure either.

"Taipei County was treated like a fool," he said.

"The central government upgraded our status, but cut NT$30 billion [US$900 million] from our annual budget before giving us more money. What kind of redistribution is that?" he said.

In response, Cabinet Spokesman Shieh Jhy-wey (謝志偉) told a press conference yesterday afternoon that the Cabinet "will carefully handle this issue and be fair to the three [local] governments."

Additional reporting by Mo Yan-chih and Jimmy Chuang.
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