As the central government's budget for fiscal year 2001 -- the first presented by a DPP-ruled central government -- is readied for review by the legislature next week, critics have been disappointed to find it practicing little of what the DPP has preached.
"While President Chen Shui-bian (陳水扁) promised to build a `small but beautiful' government, his administration has produced a `big and unbecoming' government budget," said Norman Yin (殷乃平), a professor of money and banking at the National Chengchi University.
According to the budget bill, the projected expenditure for 2001 would be NT$1.6082 trillion, up 6.3 percent compared with that of the current fiscal year and marking the largest growth in six years. With the total projected revenue standing at NT$1.4585 trillion, there would be a deficit of NT$149.8 billion.
Social welfare would top spending, constituting 18.8 percent of the total expenditure. Spending on economic development, dropping by 2.5 percentage points from the current fiscal year, would account for 13.1 percent of the total expenditure.
According to the Directorate General of Budget, Accounting and Statistic, the new administration managed to save up a total of NT$180 billion from discontinued projects and across-the-board cutting of miscellaneous spending such as travel expenses, over-time pay and maintenance fees. The money would be used to fund 21 new projects including post-earthquake reconstruction work, educational reform, anti-corruption campaign and the welfare programs promised by President Chen.
Yin said the way the new administration handled the budget was inconsistent with the principle of "zero-based budgeting" that it had claimed to follow.
"The budget planning wasn't based on any evaluation of policy priorities. What we see is a big increase of social welfare spending and an across-the-board cut of other spending," Yin said.
Structurally speaking, the consumer spending will be 4.97 times more than capital spending for 2001, compared with 4.67 for the current fiscal year.
"Apparently, the over-inflation of spending on consumer-oriented items will be unfavorable to economic growth," warned Chiu Yi (邱毅), a research fellow at Chung-Hua Institute for Economic Research (中華經濟研究院).
Critics predicted that the trend would only worsen government debt four years from now, which is already a serious problem today.
Official statistics show that the central government's outstanding debt, on paper, had accumulated to NT$2.3975 trillion as of this fiscal year. Lawmakers from the People First Party have estimated that national debts have actually reached nearly NT$10 trillion when other "hidden debts" are figured in.
Unless the government works to achieve a balanced budget instead of creating more deficits, more debts will inevitably be incurred to cover the annual deficits.
Diane Lee (李慶安), spokeswoman for the PFP caucus in the legislature, called the budget of the new administration one that was lacking in any "aspiration for reform."
"When the KMT was the ruling party, it tried to raise the ceiling for public debt to avoid its financial obligations. Today, Chen still doesn't take this severe fiscal problem seriously," Lee said.
In addition to the PFP, legislators from the New Party and the KMT have all vowed to closely scrutinize the budget to ensure the money is well spent.
Opposition lawmakers have a good reason to protest as almost all the drawbacks cited by DPP politicians in the past budgets are said to be available in this one presented by their own administration.
The most commonly criticized is creative use of bookkeeping techniques to produce a string of phony numbers to mask fraud and abuse in the government budget.
The legislators have accused the administration of overestimating its revenues from income, commodity, securities and business taxes. While the New Party says the overestimated figure was NT$72.7 billion, the PFP claims the gap will reach NT$230 billion.
"The budget can be slashed by at least 10 percent and government operation will not be affected," argued Lai Shyh-bao (
Even in the appropriation of social welfare spending, a number of items falling under this category have been discovered by the legislators as "going to the wrong place." One of them is the budget for the establishment of a foundation to compensate victims who were wrongly convicted during the martial law era.
"When DPP legislators were critical ... during the last review of the government budget, it is surprising that the DPP government has adopted the same method adopted by the past KMT government," said PFP Legislator Chin Hui-chu (
MILESTONE: The foreign minister called the signing ‘a major step forward in US-Taiwan relations,’ while the Presidential Office said it was a symbol of the nations’ shared values US President Donald Trump on Tuesday signed into law the Taiwan Assurance Implementation Act, which requires the US Department of State to regularly review and update guidelines governing official US interactions with Taiwan. The new law is an amendment to the Taiwan Assurance Act of 2020 focused on reviewing guidelines on US interactions with Taiwan. Previously, the state department was required to conduct a one-time review of its guidance governing relations with Taiwan, but under the new bill, the agency must conduct a review “not less than every five years.” It must then submit an updated report based on its findings “not later
The Presidential Office today thanked the US for enacting the Taiwan Assurance Implementation Act, which requires the US Department of State to regularly review and update guidelines governing official US interactions with Taiwan. The new law, signed by US President Donald Trump yesterday, is an amendment to the Taiwan Assurance Act of 2020 focused on reviewing guidelines on US interactions with Taiwan. Previously, the department was required to conduct a one-time review of its guidance governing relations with Taiwan, but under the new bill, the agency must conduct such a review "not less than every five years." It must then submit an updated
CROSS-STRAIT COLLABORATION: The new KMT chairwoman expressed interest in meeting the Chinese president from the start, but she’ll have to pay to get in Beijing allegedly agreed to let Chinese Nationalist Party (KMT) Chairwoman Cheng Li-wun (鄭麗文) meet with Chinese President Xi Jinping (習近平) around the Lunar New Year holiday next year on three conditions, including that the KMT block Taiwan’s arms purchases, a source said yesterday. Cheng has expressed interest in meeting Xi since she won the KMT’s chairmanship election in October. A source, speaking on condition of anonymity, said a consensus on a meeting was allegedly reached after two KMT vice chairmen visited China’s Taiwan Affairs Office Director Song Tao (宋濤) in China last month. Beijing allegedly gave the KMT three conditions it had to
STAYING ALERT: China this week deployed its largest maritime show of force to date in the region, prompting concern in Taipei and Tokyo, which Beijing has brushed off Deterring conflict over Taiwan is a priority, the White House said in its National Security Strategy published yesterday, which also called on Japan and South Korea to increase their defense spending to help protect the first island chain. Taiwan is strategically positioned between Northeast and Southeast Asia, and provides direct access to the second island chain, with one-third of global shipping passing through the South China Sea, the report said. Given the implications for the US economy, along with Taiwan’s dominance in semiconductors, “deterring a conflict over Taiwan, ideally by preserving military overmatch, is a priority,” it said. However, the strategy also reiterated
RSS