38
WEDNESDAY, MARCH 3, 1993
QUESTION:
BUT
I WOULD LIKE TO REFER YOU TO THE MEDIUM RANGE FORECAST BOTH THIS YEAR AND LAST YEAR REGARDING THE
WORKS EXPENDITURE OF THE CAPITAL
I FIND (INAUDIBLE).
THAT THIS YEAR WE ARE UNDERSPENDING IN THE CAPITAL WORKS PROJECT BY NEARLY 8 BILLION DOLLARS, IS THAT RIGHT?
THIS WHEN THE (INAUDIBLE) IN THE MEDIUM RANGE FORECAST, THE FORECAST
SMALLER YEAR, OR RELATING TO THE EXPENDITURE OF CAPITAL WORKS IS EVEN THAN
CAPITAL WORKS THAT MADE LAST YEAR. SO DOES IT MEAN THAT MORE PROJECTS WILL
THESE BEING
DELAYED?
FS:
BE DELAYED AND WHAT KIND OF PROJECTS ARE
THE
BECAUSE
NO. WHAT I THINK IF WE CAN AVOID LOOKING AT ALL THE FIGURES THERE ARE DIFFERENT WAYS OF DEFINING THEM, BUT IF YOU LOOK IN ONE OF GOOD CHART THE APPENDICES TO THE BUDGET SPEECH, YOU'LL FIND QUITE A WHICH COMPARES CAPITAL WORKS SPENDING AGAINST THE GUIDELINE AND IF YOU LOOK AT THAT YOU'LL FIND THAT WE FORECASTING THAT CAPITAL WORKS SPENDING
GUIDELINE. IN 93/94 WILL BE MORE OR LESS IN LINE WITH
IF YOU I'M AVOIDING YOUR QUESTION SLIGHTLY BECAUSE THE TROUBLE IS, START TALKING ABOUT ANY OTHER COMPARISONS THEN YOU GET INTO THE BOG OF WHETHER TO COMPARE NEXT YEAR'S ESTIMATE WITH LAST YEAR'S ESTIMATE OR BUT THE LAST YEAR'S REVISED ESTIMATE WHICH IS THE ACTUAL EXPENDITURE.
ENDING FACT IS THAT WE DID UNDERSPEND THIS YEAR, THE YEAR THAT'S JUST
BUT AND THAT WE ARE TRYING TO RECOVER SOME OF THAT IN THE COMING YEAR IT WON'T BE EASY.
QUESTION:
I UNDERSTAND THAT YOU HAVE SEEN A LOT RATIONALE, THAT'S WHY WE PUT UP OUR DEFICIT BUDGET THIS YEAR. SO CAN YOU EXPLAIN TO THE PUBLIC WHY IT IS THE RIGHT TIME THAT YOU PUT FORWARD A DEFICIT BUDGET? AND AS USUAL WE ALWAYS GET UNEXPECTED INCOME, SO WILL IT BE AT THE END WE WILL COME UP WITH A SURPLUS AGAIN?
FS:
WELL, THE HONEST ANSWER TO THE LAST BIT IS, WE COULD, BECAUSE IT IS A VERY SMALL DEFICIT, I MEAN IT IS WELL WITHIN ANY NORMAL BOUNDS OF FALLLIBILITY. THE FIGURES HAPPEN TO COME TO A DEFICIT, OF COURSE IF REVENUE COMES OUT BETTER A LOT DEPENDS ON THE REVENUE, SOMETHING ALSO DEPENDS ON THE PUBLIC WORKS, SO I CAN'T RULE IT OUT
BUT OUR HONEST FORECAST AT THE MOMENT IS A VERY SMALL DEFICIT.
THIS
THE FIRST PART OF YOUR QUESTION WAS: WHY DEFICIT YEAR? ACTUALLY, WE HAVE BEEN FORECASTING DEFICITS FOR SOME TIME. I MEAN IF I COULD JUST GET THIS SIMPLE POINT ACROSS BECAUSE 1 GET CONFLICTING ARGUMENTS ON THIS. THE ONLY WAY YOU CAN USE THE RESERVES UP IS TO RUN A DEFICIT, THAT IS A SORT OF MATHEMATICAL FACT.
SQ THOSE PEOPLE WHO THINK THE RESERVES ARE TOO HIGH, WHICH WOULD INCLUDE ME
YOU AT THE MOMENT, I MEAN WE DON'T NEED 120 BILLION, THE ONLY WAY CAN DRAW ON THE RESERVES, UNDER OUR SYSTEM, IS BY RUNNING A DEFICIT. THAT'S ALL THE DEFICIT IS, IT'S A WAY OF DRAWING ON THE RESERVES. YOU DON'T NEED TO GET WORRIED ABOUT A DEFICIT, UNLESS IT IS BEING CAUSED BY RECURRENT EXPENDITURE GOING OVER THE LIMITS, AND I HAVE MADE VERY SURE THAT THAT IS NOT THE CASE. YOU WILL FIND, IF YOU LOOK AT THE FIGURES, RECURRENT EXPENDITURE IS FORECAST TO GROW BY 5.2% FOR 93- 94. IT IS THE CAPITAL IT IS THE NON-RECURRENT WHICH IS OVER THAT, AND PART OF THAT IS AN ATTEMPT TO MAKE UP FOR THE TIME LOST THIS AND LAST YEAR.
YEAR
/QUESTION: