No Drastic Increase for Ministry of Construction Budget

Published on Mar 31, 2017 AT MyanmarTimes Newspaper

Written by Tin (Ruby) Yadanar Tun

In the current fiscal year ending March 31, the Ministry of Construction has planned more business activities than in previous years, ranging from nationwide residential projects and urban development schemes to low-cost apartment ventures.

Despite these new projects, the estimated budget expenditure for the upcoming fiscal year remains similar to that of the preceding year.

For the upcoming 2017-18 fiscal year, the Ministry of Construction’s estimated budget includes K503.068 billion in expenditure and K274.214 billion in revenue, according to the Ministry’s Accounts Department. This leaves the ministry with a deficit of over K200 billion (specifically K229 billion) for the 2017-18 period.

Compared to the previous fiscal year, the Ministry of Construction will see an increase of K63 million in expenditure and K58.819 billion in revenue for 2017-18. Last year, revenue was expected to be K337.033 billion, with an allocated expenditure of K503.005 billion.

The Ministry aims to begin building one million urban units as part of an urban expansion project to develop 330 cities across the country. Union Minister for Construction U Win Khaing stated that the ministry hopes to complete this project by the end of 2030, with units serving both governmental purposes and private ownership.

In the current fiscal year, the Ministry has spent only a small portion of its allocated budget on infrastructure development in Yangon, such as basic buildings, roads, bridges, and housing schemes. Most of the allocated budget was applied to other states and divisions outside the major commercial hub. Consequently, the Ministry had to utilize circulating capital to fund housing projects, according to U Win Naing, Director of the Department of Urban and Housing Development (DUHD).

In June 2016, the Ministry of Construction began inviting tenders from private sector developers to build affordable housing. According to the Minister, the Yangon Region has dedicated 232 acres specifically for these affordable housing projects.

To carry out Yangon’s housing and urban development schemes, the Ministry was provided with K100 billion in circulating capital. The Director added that the related projects have since been completed.

“The main point is that in 2014, the government provided us with K100 billion in circulating capital for housing projects,” said U Win Naing. “The budget expenditure allocated in the financial draft laws for Yangon housing was intended only for basic structures; the main project itself was funded by the circulating capital.”

According to related budget and financial legislation, the overall national revenue for the 2017-2018 fiscal year will be K16,768 billion, against an expenditure of K20,896 billion. These figures were shared by Vice President U Myint Swe, Vice Chair of the Financial Commission, during a commission meeting held in Nay Pyi Taw in the second week of January.

The budget proposals for the Ministry of Construction were devised as part of the Union budget. The Ministry of Planning and Finance, along with the Financial Commission, will implement these budgetary measures step-by-step.

Furthermore, officials from regional and federal ministries will discuss the budget in detail. Official disclosure of revenue and expenditure for each ministry will be made by the Ministry of Finance before the start of the next fiscal year in April, according to Deputy Minister for Finance U Maung Maung Win at the second Pyidaungsu Hluttaw’s fourth regular session last week.