The comments of the members of the Islamic Consultative Assembly regarding the budget bill of 1400 have been made in the media in a way that shows the rejection of a part of the general budget. This could affect the government’s performance in recent months and in some domestic markets. In this note, we will address this hypothesis. Please be with Artan Press.
The general budget proposed by the government to the parliament from the first day was accompanied by many controversies, so that the hopes of the general approval of this bill have been accompanied by many ups and downs. But the fact that the rejection of the budget as a whole is an issue that is considered the main scenario of the parliament’s performance towards the budget is an issue that is less likely. The rejection of the general budget should not be considered final from now on, and the approval of the general budget along with the fundamental changes in the budget details are also in favor.
*** Lack of transparency in revenue generation and government wealth creation in the 1400 budget bill
The prospect of generating revenue and creating state wealth in next year’s budget bill is not clear to members of parliament and sometimes does not correspond to the reality of society. Therefore, this issue became an excuse for the ministers and the president to ask questions in the parliament about the logic of calculating the budget bill.
At the same time, some experts predicted more than 590,000 billion tomans of dubious budget sources, the major part of which is probably related to oil revenues, which will not be realized. Sales growth from this financial channel is not very likely.
*** Failure to realize the revenues reported in the 1400 budget bill
Usually the budget of each country is designed with the aim of considering the appropriate level of welfare of the people of the society. This means that social welfare is a very important factor in fiscal policy in other countries. An issue that raised questions for MPs was the lack of reported revenues in the budget bill. Because there is no infrastructure for exports and sometimes no way to earn money in the current situation.
We should not look to the future with the view that US international sanctions will make Iran’s revenue stream more accessible. There is currently no clear Biden approach to foreign policy, especially with regard to relations with Iran, and Trump has created a path that poses challenges for the next US administration. Therefore, the issue of revenue generation cannot be included in the budgeting scenario with an optimistic view.
*** The failure structure of government spending
After the issue of revenue generation and considering income factors, another issue that is not well clarified for MPs is the issue of the structure of government spending failure. Many public sector expenditures are not well and clearly discussed in this bill, which can be It puts social welfare at risk next year. Failure to generate revenue, along with unprecedented growth in unavoidable costs, means raising money from sources that, like this year, are experiencing high and unprecedented inflation.
Unfortunately, next year, most likely due to the more difficult way for foreign exchange to enter the country and rising production costs, we may see a recession in the markets along with inflation, which should be planned for difficult conditions from today and consider the most difficult conditions کرفت. However, wage increases are projected at only 25 percent, and these figures warn of the danger of a decline in people’s purchasing power in 1400 and a poorer population.
*** Predict 100% inflation growth in basic commodities
As mentioned earlier, the budget bill should give a convincing and reasoned answer to the issue of social welfare, because welfare is a strategic indicator for the economy of any country and all the efforts of economists and policymakers in welfare and raising its level in society can be summarized. .
The forecast of 25% growth in wages is considered in the context that this year in the foreign exchange, gold and commodity markets, we have experienced 100% inflation growth in some basic commodities, and this shows that with this volume of the program We will see more difficult conditions at the level of welfare.
Given that if the parliament and the government do not agree on next year’s budget bill, the Guardian Council will be the final decision-maker and key policymaker in this area. The differences between the parliament and the government should not be so great that the decision for the Guardian Council is made with high risks. Therefore, the parliament should express its views on the important issues raised in this bill.
*** What will happen if the parliament and the government continue to have a serious dispute over the 1400 budget?
If the budget bill changes a lot, the Guardian Council will definitely object to this issue, so the parliament should include the way of agreement and compromise with the government in its program so that the budgeting process does not enter the tortuous path of paperwork. If the differences between the parliament and the government are so great that they cannot be ignored, the budget should be amended in the Joint Consolidation Commission and then sent to the Guardian Council.
Parliament has reacted sharply to the government’s budget report in recent days, and agreeing on the bill is currently a challenging issue. A lawmaker has said that this is the weakest budget bill a government has presented in Iran, and that it has tarnished its image. Some lawmakers have said that a 23 percent increase in dependence on oil is a 200 percent drop. Operational balance, lack of resistance economy characteristics and a deficit of at least 300 thousand billion tomans are the main reasons Parliament is worried about the budget deficit of 1400.
*** Next government budget deficit
Parliament has expressed concern about the next government’s budget deficit if the bill is passed. Many analysts believe that reducing government budgets can directly lead to very irreparable consequences, only a part of which is the non-payment of claims of private companies and contractors and other companies that directly and indirectly Government cooperate.
If the budget is in deficit. In order to compensate for the budget deficit, the central bank has to print without the support of money, and this, in addition to indebting the government, provides the ground for very severe inflation in society. Parliamentarians’ predictions in expert meetings are that the budget will face a hidden deficit, budget information shows that we are facing serious problems in providing resources, and this is very likely.
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