Sri Lanka’s unpopular government hell bent on providing more benefits, better jobs, higher salaries for the people in the edge of going to polls has failed to prune high state spending to satisfy masses.
Around 50% of government revenue is spent on salaries and pensions, and a further 36% on interest.
With 86% of revenue eaten up with these two items, the country is effectively borrowing to consume, and debt keeps growing.
A structural change is needed in Sri Lankan government spending, nearly half of which now goes for salaries and interest payments, with more expenditure required on education, health, and infrastructure, a senior official said.
The total government expenditure was Rs. 962 billion during the first four months of 2019.
This was an increase of 10.1 per cent compared to the same period of 2018, finace ministry report revealed adding that the recurrent expenditure was Rs. 756 billion and the capital expenditure was Rs. 211 million.
Recurrent expenditure increased by 9.4 per cent, reflecting the increase in salaries and wages of the government employees and interest payments while the capital expenditure increased by 12.8 per cent in the review period.
The bills brought forward from the previous year had an impact on this increase. Salaries and pension
The expenditure on salaries and wages of public servants including Provincial Councils increased by 3.9 per cent in the first four months of 2019, compared Rs. 218 billion in the same period of 2018.
The pension payment was Rs. 74 billion for the first four months of 2019, an increase of 17.8 per cent compared to the same period of 2018.
(LI)