The Executive Yuan plans to grow Taiwan’s defense budget by 4.09 percent for the next fiscal year, a ratio equal to the rate of GDP growth over the past three years, sources familiar with the matter said yesterday.
This would increase the Ministry of National Defense budget for the next fiscal year to NT$382.6 billion (US$12.78 billion), up from NT$367.6 billion this fiscal year, should the plan be accepted in its present form, they said.
President Tsai Ing-wen (蔡英文) is expected to approve the plan in the next few days, which would enable the Executive Yuan to present the budget to the legislature soon, they added.
“The growth rate of the next year’s defense budget is being planned on the principle that it should be no lower than the GDP growth over the past three years,” Directorate-General of Budget, Accounting and Statistics Minister Chu Tzer-ming (朱澤民) said when asked about the plan.
As national defense is a presidential prerogative, any plan relating to its budget originating from the Executive Yuan must obtain Tsai’s approval before it is considered by the Legislative Yuan, he said.
The general budget for the next fiscal year is scheduled to be presented to lawmakers next month, he said.
The sources said that the planned defense spending hike is a response to an escalating threat from China, which has continuously deployed aircraft and ships in military exercises around Taiwan.
In addition to boosting spending, the ministry is to receive additional funding in the form of the Sea-Air Combat Power Improvement Plan, a special budget for buying advanced weapons systems, including F-16V jets and domestically produced missiles, they said.
As the special budget is not included in the ministry’s regular spending, actual defense spending would exceed 4.09 percent, should Tsai approve the present plan, the sources said.
Meanwhile, the Ministry of Health and Welfare continued to receive the largest share of the budget, as current plans indicate that NT$2.54 trillion would be utilized to fund its programs in the next fiscal year, the sources said.
Social welfare programs were the biggest spending item in the draft general budget, with NT$690 billion being allocated, they added.
Much of that figure was accounted for by mandatory spending, such as subsidies for elderly people and disadvantaged groups that are required by law, the sources said, adding that maintaining entitlement programs remains one of the highest priorities.
As a result of the raises in welfare and defense spending, the government’s other ministries would likely lose large portions of their budgets, they said.
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