BE2C2 Report; Dec 23, 2016 — Saudi Arabia has released the budget expenditures for 2017; more than a third of its expenses will be in two key emerging sectors: the education with more than 200 billion riyals, and the health and social development sector with 120 billion riyals.
The figures allocated for the education and health and social development sectors represent more than one-third (36%) of the total estimated budget amounting to 890 billion riyals.
This year’s budget is 6% higher than last year’s. Unlike previous budgets, the 2017 budget is based on a four-year budgetary cycle for the period 2017-2020, the first of its kind to ensure a fiscal balance program in reducing unnecessary expenditure and maximizing non-oil revenue.
Saudi Arabia doubled its non-oil revenues to SR200 billion over the past 4 years. It expects an increase to SAR212bn in 2017.
The 890 billion riyals’ budget was divided on 9 major sectors: 200 billion riyals for education, 190 billion for the military and 120 billion for health sector and social development sector.
The budget has allocated 107 billion riyals for the public programs, 96.6 billion for security and administrative sectors and 52 billion for the basic equipment and transportation sector.
47.9 billion riyals were allocated for the municipal services sector, 47.2 billion for economic resources and 26.7 billion public administration sector.
Yesterday, Reuters reported that the government announced its budget deficit fell sharply in 2016 to SAR297bn.
It said the reduced deficit, from the SAR326bn predicted by the government, would allow Riyadh to claim significant progress and could prompt momentum for further reforms.
The 2017 budget is expected to see spending of SAR890bn, 6 per cent higher than projected spending from 2016.
The budget is also expected to include a financial aid program to compensate low- and middle-income Saudis hit by austerity policies.