|2019 Budget Process|
Because of the 'political crisis' of 2017-2018, the VIII Constitutional Government was not formed until June 2018, and the General State Budget for 2018 was not promulgated until 27 September 2018. As a result, the process of designing and enacting the 2019 State Budget is delayed, as allowed by the Budget and Financial Management Law when a new Government comes into office.
As in the last several years, the Ministry of Finance held a jornadas orçamentais (Budget Days) workshop on 12-18 September 2018 to discuss program and budgeting for 2019. La'o Hamutuk and others outside the government were invited for the last two days. Download the presentations (in Tetum) here.
At the Council of Ministers meeting on 21 September, the acting Minister of Finance presented three budget scenarios, and the Government chose the highest one, with a budget ceiling of $1.44 billion (including borrowing) for 2019, comprised of:
$200 million for salaries and benefits (same as in the proposed 2018 budget)
$305m for goods and services (28% less than in 2018)
$622m for public transfers (137% more than in 2018)
$ 4m for minor capital (same as 2018)
$219m for development capital (without borrowing) (34% less than 2018)
$ 87m in borrowed money for development capital (41% more)
As in past years, these numbers are likely to change as the Government develops its budget proposal and incorporates the cost of the Sunrise buyout. In the first step, the Ministry of Finance oriented the ministries on 25 September. Each ministry is to submit its budget proposal and Action Plan to the Ministry of Finance by 12 October, so that the complete Budget Proposal can be presented to Parliament on 8 November.
The Council of Ministers continued to discuss the budget at subsequent meetings. On 3 October, they appointed a Policy Review Committee, comprised of the Prime Minister and six other ministers, to assess the feasibility of plans for 2019. The Committee held a preliminary meeting on 19 October and will meet again on 22-27 October with each state institution.
On 22 October, Vice-Minister of Finance Sara Lobo Brites announced that the budget will be more than previously described, but she would not give a number. In addition to more money for education, health and other government priorities, the budget is likely to include $350 million to buy ConocoPhillips' share of the Greater Sunrise project, as described by TimorGAP President Francisco Monteiro. He said that he Ministry of Petroleum and Minerals is asking for $374 million in the 2019 State Budget. The $24 million above the Sunrise purchase is much more than its annual allocations in 2013-2018, which were $9.1, $11.9, $13.9, $12.5, $17.4 and $12.8 million respectively.
On 29 October, the Budget Policy Review Committee finished its preliminary proposal, as reported by the Ministry of Finance, for a total 2019 budget of $1.35 billion, including $350 million to purchase ConocoPhillips 30% share of the Sunrise contract. However, Independente reported that the Budget Director-General of State Finances said that the Council of Ministers might add $300 million more, as the $1.35 million included only $600 million for Line Ministries.
On 30 October, La'o Hamutuk and FONGTIL hosted a public meeting on the 2019 State Budget, which was reported by Tatoli and included presentations by La'o Hamutuk and the Secretary of State for Social Communications.
Also on 30 October, the Prime Minister issued a Budget Circular encouraging all government agencies to help prepare the budget, and the next day the acting Minister of Finance presented the proposed budget to the Council of Ministers.
The 2019 budget grew rapidly. On 4 November, GMN cited Minister Agio Pereira that the budget could be as much as $2 billion. At its 6 November meeting, the Council of Ministers discussed a proposed 2019 budget of $1.827 billion (including loans), as also reported by the Ministry of Finance. The Council approved the budget on 7 November, and it will be presented to Parliament on 8 November.