FY 2014 Budget Is In Good Form

Tia Belau Editorial, July 29, 2013 —- 

I have been writing about Palau’s annual national budget for many years in various news articles, editorials, or blog posts. In fact, I started reviewing and writing about the budget toward the second-half of the second term of the Remengesau administration.

This undertaking allows me an opportunity to pore over the budget and its accompanying attachments in details including, transmittals, draft legislation, fund availability analysis, budget sheet summaries, and financial reports from the ministry of finance and other supplemental information that comes out over the course of the budget deliberation process.


I make it a point to read through all the pages and entire documents to try to make sense out of the budget. But this in reality is the conventional way of analyzing the budget. It is not so much on crunching the numbers but more about comparing the proposed allocations of each budget year’s activities with the previous fiscal year’s allocations, while trying to understand the significance of any variations that may exist.


As constitutionally required, the president prepares and submits the annual national budget to the Olbiil Era Kelulau for approval. The president normally puts the budget request together in a structure of draft legislation and submits it to Olbiil Era Kelulau with a transmittal letter to the presiding officers of both houses of the Olbiil Era Kelulau.

Transmittal is a way for the president to briefly highlight his budget priorities while providing a indication of what the whole appropriation hopes to accomplish by way of fiscal policies. This is done in an annual cyclical process, and in which brings up my point – the particular way fiscal year 2014 is presented.


Fiscal Year 2014 budget request was submitted to OEK on July 8, 2013. The transmittal was only one-and-half pages long. However, the budget bill had with it attached document in the form of fund availability analysis with its associated projections, which is required by law. In previous budget process, this would be the only documents provided for the OEK, not in the least for other interested parties to use for own review.

But following the July 8 submittal by the president, another set of FY 2014 annual national budget documents were transmitted by Minister of Finance Elbuchel Sadang to the respective chairman of the Ways and Means Committee of both houses. These consist o f summary information that provides the Economic Outlook for Palau in 2014; provides you the Remengesau’s Administration’s Strategic Direction which detail elements of Economic Policies, Fiscal Policies, and Policy Initiatives in line with the Remengesau’s Management Action Plan.

The Minister of Finance also submitted FY 2014 budget summary and budget highlights, which draw you attention to the specific increases or new spending activities proposed for next fiscal year. Other documents provide summary of the Unrestricted Local Revenues, which is also referred to as General Fund. Instead of reading from tables, there is a narrative which lets for easy understanding of the data.

Budget appropriations for primary budget activities such as the General Operations (Executive Branch), Board, Commissions, and Authorities; Judicial Branch, Olbiil Era Kelulau; State Block Grants; Independent Agencies, Other Programs and Activities; Educational Assistance; other appropriated items; Local Special Revenue [trust] Funds; Budget Related Services; Debt Service; and Capitol Projects are also provided in a narrative form.

Despite the time consuming task of going into the proposed budget bill for the basic information, the new budget presentation with its accompanying documents is a boon for the news media as well as provides easy access for information at the level for the lay audience.

Regardless of policy differences we may have, this is a good budget in terms of its openness, the presentation of information, and connecting fiscal policies to policy initiatives.

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