Back to the complete issue
Thursday, 23 June 2016

Budget proposal would create constitutional crisis, Moussa says

Current budgetary allocations could create a constitutional crisis, former presidential candidate Amr Moussa told Al Ahram. The constitution explicitly binds the government starting FY2016-17 to the minimum spending thresholds of 3% of GDP on healthcare, 4% on education, 2% on higher education, and 1% on scientific research. Moussa explained that Article 124 of the constitution gave the House of Representatives the right to reallocate some spending and, if that resulted in increasing overall expenditures, then the government is expected to cooperate with parliament to find revenue sources. He reiterated the importance of the spending clauses in the constitution, saying that they would address the weaknesses in the healthcare and education sectors.

…Sources from the House Committee on Healthcare told Al Borsa that spending earmarked for healthcare will rise to EGP 76 bn, which al Borsa says is 3% of GDP if calculated to be EGP 2.8 tn (it is actually closer to 2.7%). The committee had hoped to increase healthcare spending to EGP 81 bn, but weakness on the revenue side proved challenging. It has also refused to re-allocate funds for health-related spending to the Ministry of Health: Provisions for water treatment will remain part of the Housing Ministry’s budget, for example, despite being classified as preventive medicine. The House of Representatives could reach a compromise, the chairman of the House Committee on Education, by agreeing to base calculations on the GDP of FY2015-16, an issue left vague by the constitutional clauses. The compromise has already been approved by the House Planning and Budget Committee, as we reported earlier this week.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.