Thursday, June 12, 2008

No Matter How Rushed, The Law is the Law

No Matter How Rushed, The Law is the Law
China Times Editorial (Taipei, Taiwan, ROC)
A Translation
June 12, 2008

The new government has been in office less than a week. Yet it is already asking for a supplementary budget in order to increase domestic demand and construct public infrastructure. Logically speaking local governments ought to welcome such a budget. To everyone's surprise the Legislative Yuan Budgetary Research Center announced it considers such subsidies illegal. Although Blue and Green camp legislators see matters differently, their conclusions are identical. Both have sharply denounced this 100 billion NT budget package. Both Blue and Green camp local government leaders are equally dissatisfied. The new cabinet has just come to power. Yet its first act has come to such an ignominious end. This ought to be considered a warning sign.

Why has a cabinet made up of veteran financial and economics experts fumbled so badly? Because it is congenitally defective. How? Over the past eight years people have endured too much pain. This inspired the Ma team to wage an election campaign proclaiming "We're ready!" and "Everything will be better, as soon as Ma takes over!" The result was Ma Ying-jeou received over 7 million votes, 2 million more than his opponent. Once the KMT returned to power, public expectations that "Everything will be better, as soon as Ma takes over!" became a cross the new administration had to bear.

In response to such expectations, the KMT think tank held intensive meetings just before the new administration assumed office on May 20. It explored ways to ensure that everything would actually get better when Ma took over. This is how the short-term contingency budget came into being. The intentions were good. The economic prospects were too depressing. Expanding domestic demand can revitalize economic growth, therefore it is a feasible approach. Over the past eight years the DPP government has also used supplementary budgets to underwrite additional construction or increase public employment, in order to revive the economy,.

But the supplementary budgets or special budgets proposed by the DPP government over the past eight years encountered the same problems as the new cabinet. Therefore the Legislative Yuan Budgetary Research Center will issue a report pointing out, with few exceptions, violations of the Budget Law. What's embarrassing is that for the past eight years the Legislative Yuan Budgetary Research Center has been a weapon of the KMT. But because the supplementary budget involved local government interests, KMT legislators merely went through the motions. They didn't block extravagant expenditures. They allowed the legal dispute over the supplementary budget and the special budget to remain unresolved, for eight years. Now that the KMT has returned to power, the issue is blowing up in its own face.

According to the Budget Law, supplementary budgets and special budgets are subject to preconditions. Supplementary budgets are responses to expanded authority, expanded operations, or major accidents. Shortfalls in revenue or major accidents will be brought to the President's attention by the Executive Yuan committee. Surely the recent change in ruling party cannot be considered a "major accident?" The DPP government submitted similar budgets to the Legislative Yuan in the past. These budgets were investigated by the Control Yuan. One year they discovered a 7.4 billion shortfall in revenue. The Executive Yuan failed to make up the shortfall in accordance with the law by using the previous year's surplus. The Control Yuan was forced to "correct" the Ministry of Finance's oversights. The special budget, meanwhile, being more akin to a transitional budget, must meet requirements for transitional budgets.

From this perspective, the Executive Yuan's decision to invoke the short-term emergency supplementary budget and special budget amendment is questionable. For example, the Executive Yuan originally assumed that weekend cross-strait charter flights and the arrival of mainland tourists in July would be an obvious and effective short term panacea providing a boost to the economy. That is why the Bureau of Environmental Protection proposed a 38,500,000 NT "environmental upgrade in response to mainland passengers arrival on Taiwan" supplementary budget. The amount may have been small, but the Legislative Yuan Budgetary Research Center nevertheless cited it as a Budget Law violation. The Bureau of Environmental Protection's needs were met. But they were promptly deleted from the supplementary budget and instead incorporated into regular budget expenditures.

This is the easy part. Many local governments' budget items have encountered similar problems. They have been rejected by the Executive Yuan and the relevant ministries. They have been asked to reconsider their requests. County and municipal governments first submitted their requests in late April, after the KMT think tank announced its proposal and local party heads had engaged in a preliminary exchange of views. They submitted a second request after the new cabinet took office on May 20. They submitted a third request after a controversy erupted in the Legislative Yuan. All told, county and muncipal leaders submitted three or four versions. After they submitted their budgets, they dared not assume that they would be approved. As a result, both budgets have been submitted to the Legislative Yuan for consideration or for first instance review. Yet the details were finalized only on June 20. What is this besides a joke at the Legislative Yuan's expense?

The new administration has taken office. Its earnest attempt to ensure that "Everything will get better as soon as Ma takes over" deserves affirmation. But some things simply cannot be rushed. The government's two major concerns, the annual budget and pending legislation are just such things. The new cabinet is not fully in place. The incoming administration does not fully understand how the outgoing administration's budget has been allocated. It does not understand local government needs. Nor does the new cabinet have time to get caught up on such matters. It must hurry up and propose supplementary budget cuts and special budget amendments. These are examples of haste making waste.

The new cabinet may be in a big hurry. The Legislative Yuan Budgetary Research Center has cited a number of legal violations. But no matter how unhappy the Legislative Yuan may be with the Executive Yuan's budget, the people are suffering. As long as the budget is not outrageous, it should be passed. Most importantly, the 2009 central government budget is about to come out. No matter how difficult it may be, the new cabinet must find time to work closely with the various ministries, legislators, and even local governments. It cannot make such decisions on its own, behind closed doors.

中國時報  2008.06.12










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