No proposals to burden people: Cabraal

The Budget 2022 that was presented last Friday by Finance Minister Basil Rajapaksa did not propose any policies that would bring about adhoc changes that are difficult for the general public to comprehend, Central Bank Governor Ajith Nivard Cabraal said.

Pointing out that the only major change is the imposition of a surcharge, which he said, “many people will understand and appreciate”, Cabraal stressed that no policies have been proposed to change the basic fundamentals of the economy.

“The changes are minimal. Changes have been made by evading fresh burdens, which are of a very different nature. But some changes (such as the surcharge) have to be implemented going forward,” the CBSL Governor said addressing a Budget 2022 Analysis facilitated by the Centre of Banking Studies (CBS) over the weekend.
He pointed out that policy consistency has been given due emphasis by the Finance Minister in his maiden budget, but it must be understood that no policies can continue without changes and tweaking. 

“That type of freedom must be given to the government in this regard. I would generally agree with the proposition that the government has been able to by and large keep its policy consistency and ensure that there are no undue surprises to the stakeholders as well,” added Cabraal.

Key priorities for the government in budget making and economic management must be in achieving growth and stability, which the Governor said has also been taken into account in the 6 months’ road map.

Certain steps will need to be taken regarding other priorities at given times, and the current priority is to manage the foreign exchange, the debt, and the fiscal deficit.

“The government and we the Central Bank have identified the three elements as priorities and that is the first part in dealing with challenges of that nature.  That is to recognise that there is a difficult situation here and take steps to address it,” said Cabraal asserting that authorities are conscious of the situation.

“We are not hiding our heads in the sand like an ostrich. We are dealing with the issues up front.”

Meanwhile, Treasury Secretary S. R. Attygalle pointed out that the rising cost of living has been well acknowledged in the budget and due emphasis has been given to reducing the burden of the general public.

“The prices are going up mainly due to external factors. The budget has mentioned targeted support where the most vulnerable groups and households are supported. We will see local production strengthen and the vulnerable groups are supported in the budget,” said Attygalle. (SAA)