Mongolian government to increase spending by MNT 92.6 billion

Finance Minister S. Bayartsogt says the Government will revise its current budget. Usually this is only done when there is a budget deficit. But this time the Government is revising the budget to address an unexpected surplus. In July, revenues were MNT 248.8 billion more than projected. That was largely due to big increases in industrial production and mining production.

Over the last seven months, Mr. Bayartsogt says, revenues have been MNT 456.2 billion higher than expected. Therefore the Government will increase spending by up to MNT 92.6 billion, and increase investment up to MNT 288 billion. Our correspondent spoke with the Finance Minister.

- The Government is to increase spending by up to MNT 92.6 billion. What will this money be spent on?

- Of course, the most important needs will be addressed first. For instance, we have planned MNT 30 billion for the employment fund and MNT 10 billion for the government reserve fund. We will also increase funding for health programs. Also, MNT 4.3 billion is planned for transportation programs for students, older people, and the disabled, and MNT 6 billion for the health insurance fund. We have also planned MNT 1 billion to help Mongolian athletes prepare for the 2012 Olympic Games.

- World copper prices are falling. Will that affect the budget?

- A law was passed that limits the negative impact of market fluctuations on the budget. We are not always required to buy or sell commodities at the market price. That way, even when there are big fluctuations, the impact on the budget is minimal.

- The Prime Minister promised to increase salaries and pensions. When will that happen? And there is also money planned for the Prime Minister’s policy fund. What is that for?

- The Prime Minister’s policy fund was established in 2007. This is for addressing budget surpluses. We are focusing on salary and pension issues right now. A large amount of money in the Prime Minister’s policy fund will be spent for increasing salaries and pensions. The Government will officially announce that when the budget is delivered to MPs on October 1.

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