The Chinese Nationalist Party (KMT) caucus yesterday said it would propose amendments to the Act Governing the Allocation of Government Revenues and Expenditures (財政收支劃分法) to separate fiscal allocations for the three outlying counties from the 19 municipalities on Taiwan proper.
KMT Legislator Chen Hsueh-sheng (陳雪生) has started working on the amendments to Article 16-1, which should reach a party consensus soon, it said.
President William Lai (賴清德) and Premier Cho Jung-tai (卓榮泰) yesterday criticized recent changes to the act, passed by opposition parties last year, for leading to non-distributable funds, central government debt and unequal distribution across urban and rural areas.
Photo: Liao Chen-huei, Taipei Times
The opposition’s amendments to the act last year were a “grave mistake,” Lai said.
The formula was improper, leading to more than NT$30 billion (US$988.7 million) in non-distributable funds and uneven horizontal allocation, leading to less funding for southern counties and cities, he said.
The amendments further pushed the central government to borrow more than NT$300 billion to balance out next year’s budget, weakening its ability to provide relief to local governments in the event of natural disasters, he added.
When the amendments were originally proposed last year, the opposition expected the Cabinet to present its own version, KMT caucus deputy secretary-general Lin Pei-hsiang (林沛祥) told a news conference yesterday.
However, the Executive Yuan did not offer an alternative proposal and reiterated that the original system of allocating 75 percent of national tax revenues to the central government and the remaining 25 percent to local governments was the best one, Lin said.
KMT Legislator Lai Shyh-bao (賴士葆) called the flaws in the formula highlighted by the Cabinet “small flaws” and “calculation errors,” referring to the calculation of funds for the three outlying counties of Penghu, Kinmen and Lienchiang.
Amendments should be made accordingly, he said, adding that there are no problems with the law other than that.
The problems posed by the amendments were raised by the Cabinet when it requested the legislature to reconsider the bill, Cho said.
Cho is scheduled to invite local governments to two discussion sessions on the act tomorrow.
The latest revision of the act would lead to urban-rural inequity and is being rushed through, creating major difficulties in compiling next year’s national budget, Cho was quoted by Cabinet spokeswoman Michelle Lee (李慧芝) as saying.
Economic Democracy Union convener Lai Chung-chiang (賴中強) blamed the controversy on a “power grab” by the KMT, as legislators seized the authority to distribute state funds away from Ministry of Finance.
“In the KMT’s motion at the time regarding the authority to decide and set the formula for fiscal allocation, it wrote that ‘the Cabinet cannot be trusted’ and ‘also shall prohibit the Ministry of Finance from deciding on proportion of funds for distribution,’” Lai added.
Meanwhile, Democratic Progressive Party Taipei City Councilor Chien Shu-pei (簡舒培) lashed out at the KMT’s 14 local government heads for piling scorn on the central government over the chaos of the fiscal allocation.
“During the final process prior to voting, the amendment text kept on changing, legislators received many different versions within just an hour, and it was a very chaotic scene in the legislative chamber,” she said. “Many members of opposition parties did not even know which version they were voting on and asked others afterward which version had been passed.”
Additional reporting by Lin Che-yuan, Huang Mei-chu and Jason Pan
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