UAE Vice President, Prime Minister and Ruler of Dubai His Highness Sheikh Mohammed bin Rashid Al Maktoum has approved the Dubai Government budget for the year 2013.
Public revenues are estimated at Dh32.62 billion and Public Expenditures Dh34.12 billion, leading to a projected budget gap of 18% from 2012, according to the Department of Finance (DoF) in Dubai.
The 2013 budget reflects Sheikh Mohammed's directives to generate the necessary revenues to stimulate economic growth and financial sustainability in Dubai, raise the efficiency of government agencies to provide the best services, health and social care for the citizens and residents.
Director General of the Department of Finance (DoF) Abdul Rahman Saleh Al Saleh, stated that the approved budget reflects the directives of Dubai Crown Prince and Chairman of the Executive Council Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum on the implementation of approved financial plans to support all the strategic sectors of the Government of Dubai.
Al Saleh points to the possibility of balancing the 2013 budget but emphasizes the government’s preference to expand its expenditures in a bid to support the emirate's economy by increasing public spending for the fiscal year 2013 by 6% over the 2012 budget, without sacrificing the strategic objectives of the government of reducing the deficit and achieving the balance in the general budget.
The revenue figures above highlight the success of the Emirate of Dubai in increasing its public revenues for the fiscal year 2013 by 7.2% compared to those of the previous year.
Government fees, representing 62% of total government revenues, have increased by 9.8% compared to 2012.
The rise in fees revenue is due to real economic growth and reflects the expected growth rates in the Emirate. It also reflects the development and diversity of government services which allows the implemented policy of not raising any government fees in the emirate, as adopted post the global economic crisis.
Tax revenues representing 23% of total government income which represent customs and foreign bank taxes show an increase of 15% in 2013 over 2012. This increase indicates the development in the performance of customs.
Moreover, the development and increase of foreign bank taxes is a further indicator of the evolving positive economic situation in the Emirate.
Net oil revenues witnessed an increase of 11.8% in the fiscal year 2013 owing to higher oil prices.
Allocations to budget from government investment returns were reduced to allow for increased reinvestment in the Emirate’s economic growth.
In government expenditures, salaries and wages are set at 39%, affirming the government's support of human resources and the creation of 1,600 job opportunities for Emiratis.
General and administrative expenses represent 24%, reflecting the government's commitment to further developing its institutions and its support to the provision of better government services to citizens and residents.
Subsidies and grants represent 11% of total government expenditure and show a 67% increase over 2012. These include housing subsidies, sports, non-profit organizations, charitable organizations, media and sports activities.
16% of government spending is allocated for the completion of infrastructure and developmental projects in the emirate as the government remains committed to its announced infrastructure projects which participate in economic growth and stimulate domestic and foreign investments.
Although this reflects a 4.8% decrease from 2012, it is due to the completion of several large projects. Going forward, the emirate intends to launch new projects to support Expo 2020.
The 2013 fiscal budget clearly demonstrates Dubai Government’s commitment to its obligations and earmarks 6% of the total spending to debt.
The distribution of expenditures by key sectors emphasizes this government's commitment to the individual, taking its queue from Sheikh Mohammed’s direction: “people are the real wealth of the nation”.
This is reflected in 26% of government spending being allocated to social development in the areas of healthcare, education, housing and community development. Furthermore, the Dubai government supports social services through the establishment of Public Benefits Fund to support families, and the establishment of a fund, as directed by His Highness Sheikh Mohammed bin Rashid Al Maktoum, to support small and medium-sized projects for the youth, with a view to promoting entrepreneurship among them.
In preparing the 2013 fiscal budget, it was essential not to lose sight of the security, justice and safety sector. 23% are allocated for this vital sector which supports the wellbeing of all citizens to live in security and safety contributing to higher rates of economic growth and a heightened sense of citizenship.
Despite the completion of many of the larger projects, Dubai fiscal budget allocates 35% for infrastructure, transportation and the economic sectors, as Dubai continues to grow and its government continues to support new projects.
Arif Abdul Rahman Al Ahli, Executive Director, Budgeting and Planning at the DoF, confirmed that while preparing the fiscal year 2013 budget, the Government of Dubai has adhered to the fiscal policy rules by using recurring revenues to finance recurring expenses and achieving an operational surplus estimated at Dh204 million contributing to the financial sustainability of the emirate.
Moreover, the government has indicated that it is committed to not using oil revenues to fund infrastructure projects.
In the 2013 fiscal budget, Dubai government is able to reduce the budget deficit to record levels keeping the deficit ratio at less than 0.5% of the GDP.
The Department of Finance also pointed out that it continues to work side by side with other government entities to prepare a plan for the implementation of the budget and provide the required funds according to the priorities of the government.
Follow Emirates 24|7 on Google News.