By B Izzak
KUWAIT: The National Assembly financial and economic affairs committee yesterday strongly rejected a government-sponsored draft law to withdraw KD 5 billion annually from the future generations fund, the country’s sovereign wealth fund, a lawmaker said. MP Saadoun Hammad, a member of the panel, said the committee informed the finance minister and his team that the panel has rejected the bill and will not discuss it.
Kuwait has two funds, the future generations fund and the general reserve fund. The first is for future generations only, while the other provides for government expenditures. The general reserve fund has run out of money because of a sharp drop in oil prices and as public spending continues to rise, especially on non-investment items like salaries and subsidies.
As the Assembly has refused to allow the government to borrow from international and domestic markets, it was forced to propose withdrawals from the future generations fund. Withdrawal from the fund is banned by law and a legislative amendment is needed to allow any withdrawal.
Kuwait posted an accumulative budget deficit of KD 26 billion between the 2014/2015 fiscal year, when oil prices began to slide, and 2018/2019 fiscal year. The finance ministry has projected deficits worth KD 55.4 billion over five years from 2019/2020 until 2023/2024. Notably, the budget for the upcoming fiscal year is calculated based on an average oil price of $45 per barrel, while the budget for the current fiscal year is based on oil prices of $30 per barrel.
MP Muhalhal Al-Mudhaf yesterday submitted a proposal calling to reduce the salaries of ministers and senior government bureaucrats, saying reforms should start from the top. The lawmaker also called for suspending all forms of additional benefits and perks given to them.
MP Bader Al-Dahoum, rapporteur of the budgets committee, said yesterday the committee decided to cancel a contract with a private lawyer who was hired to help defend the Assembly’s channel. Dahoum said the committee found that the lawyer, who was getting KD 30,000 annually, was not involved in any case since he was hired in 2014 and that his job was only to criticize opposition MPs. As a result, the committee decided to cancel the contract.
Meanwhile, MP Hamad Rouh El-Din yesterday sent a series of questions to the health minister over the coronavirus pandemic. He asked the minister about legal measures taken against holders of fake PCR tests. He also asked the minister about a reported plan to close the airport, which has already led to an increase in airfares. The lawmaker also asked the minister about studies on which the ministry based its decision to close restaurants, cafes, salons and health clubs.