The Chinese Nationalist Party (KMT) caucus is poised to freeze a NT$44.2 billion (US$1.37 billion) six-year budget for drone industry development, modifying an earlier proposal to scrap the funding entirely, as the legislature aims to pass this year’s long-stalled general budget today.
If the budget does not pass today, all caucuses have agreed that an extra session would be held on Monday next week to continue to review the bill.
The KMT caucus said the Executive Yuan’s drone program, which was only approved on Oct. 19 last year, posed a risk that a large sum would be allocated, and use of the funds determined later.
Photo: CNA
The caucus had previously demanded that the Executive Yuan pause the program and had proposed removing all budget items for the program under this year’s general budget, only agreeing to put funding back on the table for the next fiscal year after the legislature completes its review.
It has now been a record 350 days since the Executive Yuan approved this year’s budget on Aug. 21 last year, and sent it to the legislature for review eight days later.
While the KMT has been working to reduce the number of proposals to slash or freeze funding to expedite the budget’s passage, the Taiwan People’s Party (TPP) reportedly wants to introduce more cuts.
The TPP has proposed to slash 2 percent of the entire budget, or NT$56.86 billion, including 60 percent of special budgets across all ministries.
The special budgets for 20 units are to be elimated, including the Control Yuan, the Judicial Yuan, the Executive Yuan and the National Development Council (NDC), it said.
Officials said that the budget being in limbo has not only affected the NT$75.2 billion for national defense, but has also affected funding for social welfare, major railway projects and high-tech supply chains.
National defense officials said that while jet and ship maintenance were still provided for per Article 54 of the Budget Act (預算法), new projects would not be able to proceed.
Officials said that the general budget being in limbo is preventing the government’s access to the first and second reserve funds, as well as the disaster reserve fund.
Access to the funds, which total NT$17 billion, could be vital, especially as Taiwan enters its typhoon season, when rapid response is critical, they said.
Subsidies for domestic travel and renovations of sports stadiums and facilities are also off limits due to the general budget being in limbo, they said.
People in the tech industry warned that the Executive Yuan’s 10 new major artificial intelligence construction projects are unable to launch ancillary measures as funding has been frozen, and that the delays could cause Taiwan to miss out on a critical phase for the development of the silicon photonics industry and co-packaged optics.
In addition, about 267 drone developers are having to pay out-of-pocket to transition to a non-China supply chain because funding for subsidies has been stalled, tech industry insiders said.
Entrepreneurs have also said that, with NDC funds being frozen, venture-capital companies are retracting investments, causing a wave of dissolving tech start-ups.
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