By R Jagannathan
If P Chidambaram finally does meet his targeted fiscal deficit target of 5.3 percent of GDP in 2012-13, he can thank a faulty system of government accounting for it. The reforms introduced by the government have nothing to do with it.
If they were, his Chief Economic Advisor Raghuram Rajan would not be asking for ?more painful steps? to contain the deficit. The Economic Times quotes Rajan as saying that the cap on LPG cylinders and the small diesel price hike isn?t enough pain. ?We are moving in the right direction. Yes, (but) more needs to be done to bring it (subsidy) below 2 percent (of GDP)? We have done something. Obviously we need to do more,?
Reuters
If no major ?painful? decisions are forthcoming, one reason for it will be the outdated cash-based system of accounting which will allow him to get away with it.
At the heart of India?s bad accounting system is the treatment of revenues and expenditures on a ?cash? basis?which means if money is not in the bank account or not spent for the purposes it was earmarked, the accounts do not reflect the real picture.
For example, if money payable as subsidies in 2011-12 is actually paid out on 1 April 2012 instead of 31 March 2012, the 2011-12 budget deficit will look smaller. As for the next year?s budget, one can always put a small deficit figure and let the year decide where the actual numbers will go.
This is what Pranab Mukherjee did in the March budget, where he rolled over the balance subsidy payments due to oil companies for 2011-12 to this year, but failed to provide enough money even in this year?s budget. He provided around Rs 43,500 crore for oil subsidies this year, but almost all of it went to pay last year?s subsidies. This year?s kitty for oil subsidies started with zero.
This year, though, Chidambaram has other things working for him. While the subsidy bill is not going to disappear ? it can be rolled over to next year at best?most government departments are failing to spend the money allotted to their schemes and projects.
Net result: there will be a huge saving on expenses, even though projects will remain incomplete, and costs may escalate due to this delay in spending.
The upside is that his budget deficit will look smaller.
Business Standard reports that a quarter of over 100 spending departments had not spent even a third of the money allocated to them for 2012-13 till October. And since ministries are allowed to spend only 33 percent of a year?s total outlay in the last three months, these ministries will not end up spending their full allocations this year.
The newspaper says these ministries include atomic energy, pharmaceuticals, posts, consumer affairs, corporate affairs, power, steel and water resources. ?In the case of most of these departments/ministries, it is unlikely that their plan expenditure in November and December would be more than what they have spent during April-October.?
When ministries don?t spend what they are entitled to, the result is delayed projects, whose costs can then rise, and lower corporate incomes, since what the government spends goes to generating incomes for businesses that sell to government. In short, reducing the fiscal deficit by not spending allocations means helping the economy slow down further.
Says Vishal Bansal of Ernst & Young in BusinessLine: ?Policymakers have realised that reliance on cash-based accounting makes it harder to resolve complex financial challenges. In particular, cash basis does not provide a complete picture of the government?s liabilities, assets, cost of holding assets and their consumption. Also, it gives room for financial opportunism, and results may be changed by collecting advance taxes and/or delaying payment of expenses. The problem is compounded by a lack of disclosures in the financial report.?
The government is not only delaying expenses, but also taking its time making refunds to taxpayers. According to Chidambaram, this year refunds have totalled Rs 57,000 crore till mid-December against last year?s Rs 70,000 crore. One reason is the government?s decision to give priority to taxpayers who are owed loose change rather than big sums. He said: ?Somebody who has to get Rs 5 lakh can wait. Somebody who has to get Rs 5,000 should get first,? the minister said.
It is an equitable principle, but if not all the big refunds are paid quickly, the government benefits in two ways by accounting for it on a cash basis: the refund value does not account for the time value of the money, and the money owed may get shifted to the future, or even next year.
Isn?t it time the government stopped playing such accounting games to get the deficit in order?
Source: http://www.firstpost.com/economy/faulty-accounting-may-help-fm-meet-budget-goals-567649.html
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CAIRO (AP) ? Egypt's Islamist-backed constitution received a "yes" majority in a final round of voting on a referendum that saw a low voter turnout, but the deep divisions it has opened up threaten to fuel continued turmoil.
Passage is a victory for Islamist President Mohammed Morsi, but a costly one. The bruising battle over the past month stripped away hope that the long-awaited constitution would bring a national consensus on the path Egypt will take after shedding its autocratic ruler Hosni Mubarak nearly two years ago.
Instead, Morsi disillusioned many non-Islamists who had once backed him and has become more reliant on his core support in the Muslim Brotherhood and other Islamists. Hard-liners in his camp are determined to implement provisions for stricter rule by Islamic law in the charter, which is likely to further fuel divisions.
Saturday's voting in 17 of Egypt's 27 provinces was the second and final round of the referendum. Preliminary results released early Sunday by Morsi's Muslim Brotherhood showed that 71.4 percent of those who voted Saturday said "yes" after 95.5 percent of the ballots were counted. Only about eight million of the 25 million Egyptians eligible to vote ? a turnout of about 30 percent ? cast their ballots. The Brotherhood has accurately predicted election results in the past by tallying results provided by its representatives at polling centers.
In the first round of voting, about 56 percent said "yes" to the charter. The turnout then was about 32 percent.
The results of the two rounds mean the referendum was approved by about 63 percent.
Morsi's liberal and secular opposition now faces the task of trying to organize the significant portion of the population angered by what it sees as attempts by Morsi and the Brotherhood to gain a lock on political power. The main opposition group, the National Salvation Front, said it would now start rallying for elections for the lawmaking, lower house of parliament, expected early next year.
"We feel more empowered because of the referendum. We proved that at least we are half of society (that) doesn't approve of all this. We will build on it," the Front's spokesman, Khaled Daoud, said. Still, he said, there was "no appetite" at the moment for further street protests.
The new constitution would come into effect once official results are announced, expected in several days. When they are, Morsi is expected to call for the election of parliament's lawmaking, lower chamber no more than two months later.
In a sign of disarray in Morsi's administration, his vice president and ? possibly ? the central bank governor resigned during Saturday's voting. Vice President Mahmoud Mekki's resignation had been expected since his post is eliminated under the new constitution. But its hasty submission even before the charter has been sealed and his own resignation statement suggested it was linked to Morsi's policies.
"I have realized a while ago that the nature of politics don't suit my professional background as a judge," his resignation letter, read on state TV, said. Mekki said he had first submitted his resignation last month but events forced him to stay on.
The status of Central Bank Governor Farouq el-Oqdah was murkier. State TV first reported his resignation, then soon after reported the Cabinet denied he has stepped down in a possible sign of confusion. El-Oqdah, in his post since 2003, has reportedly been seeking to step down but the administration was trying to convince him to stay on.
The confusion over el-Oqdah's status comes at a time when the government is eager to show some stability in the economy as the Egyptian pound has been sliding and a much-needed $4.8 billion loan from the IMF has been postponed.
Over the past month, seven of Morsi's 17 top advisers and the one Christian among his top four aides resigned. Like Mekki, they said they had never been consulted in advance on any of the president's moves, including his Nov. 22 decrees, since rescinded, that granted himself near absolute powers.
Those decrees sparked large street protests by hundreds of thousands around the country, bringing counter-rallies by Islamists. The turmoil was further fueled with a Constituent Assembly almost entirely made up of Islamists finalized the constitution draft in the dead of night amid a boycott by liberals and Christians. Rallies turned violent. Brotherhood offices were attacked, and Islamists attacked an opposition sit-in outside the presidential palace in Cairo leading to clashes that left 10 dead.
The turmoil opened up a vein of bitterness that the polarizing constitution will do little to close. Morsi opponents accused him of seeking to create a new Mubarak-style autocracy. The Brotherhood accused his rivals of being former Mubarak officials trying to topple an elected president and return to power. Islamists branded opponents "infidels" and vowed they will never accept anything but "God's law" in Egypt.
Both rounds of voting saw claims by the opposition and rights groups of voting violations. On Saturday, they said violations ranged from polling stations opening late to Islamists seeking to influence voters to say "yes." The official MENA news agency said at least two judges have been removed for coercing voters to cast "yes" ballots.
The opposition's talk of now taking the contest to the parliamentary elections represented a shift in the conflict ? an implicit gamble that the opposition can try to compete under rules that the Islamists have set. The Brotherhood's electoral machine has been one of its strongest tools since Mubarak's fall, while liberal and secular parties have been divided and failed to create a grassroots network.
In the first post-Mubarak parliamentary elections last winter, the Brotherhood and ultraconservative Salafis won more than 70 percent of seats in the lower chamber, which was later dissolved by a court order. The opposition is now betting it can do better with the anger over Morsi's performance so far.
The schism in a country that has for decades seen its institutions function behind a facade of stability was on display in Saturday's lines of voters.
In the village of Ikhsas in the Giza countryside south of Cairo, an elderly man who voted "no" screamed in the polling station that the charter is "a Brotherhood constitution."
"We want a constitution in the interest of Egypt. We want a constitution that serves everyone, not just the Brotherhood. They can't keep fooling the people," Ali Hassan, a 68-year-old wearing traditional robes, said.
But others were drawn by the hope that a constitution would finally bring some stability after nearly two years of tumultuous transitional politics. There appeared to be a broad economic split, with many of the middle and upper classes rejecting the charter and the poor voting "yes" ? though the division was not always clear-cut.
In Ikhsas, Hassan Kamel, a 49-year-old day worker, said "We the poor will pay the price" of a no vote.
He dismissed the opposition leadership as elite and out of touch. "Show me an office for any of those parties that say no here in Ikhsas or south of Cairo. They are not connecting with people."
In the industrial working class district of Shubra El-Kheima just north of Cairo, women argued while waiting in line over the draft charter.
Samira Saad, a 55 year old housewife, said she wanted her five boys to find jobs.
"We want to get on with things and we want things to be better," she said.
Nahed Nessim, a Christian, questioned the integrity of the process. "There is a lot of corruption. My vote won't count." She was taken to task by Muslim women wearing the niqab, which blankets the entire body and leaves only the eyes visible and is worn by ultraconservative women.
"We have a president who fears God and memorizes His words. Why are we not giving him a chance until he stands on his feet?" said one of the women, Faiza Mehana, 48.
The promise of stability even drew one Christian woman in Fayoum, southwest of Cairo, to vote "yes" ? a break with most Christians nationwide who oppose the draft. Hanaa Zaki said she wanted an end to Egypt's deepening economic woes.
"I have a son who didn't get paid for the past six months. We have been in this crisis for so long and we are fed up," said Zaki, waiting in line along with bearded Muslim men and Muslim women wearing headscarves in Fayoum, a province that is home to both a large Christian community and a strong Islamist movement.
The scene In Giza's upscale Mohandiseen neighborhood was starkly different.
A group of 12 women speaking to each other in a mix of French, Arabic and English said they were all voting "no."
"It's not about Christian versus Muslim, it is Muslim Brotherhood versus everyone else," said one of them, Shahira Sadeq, a Christian physician.
Kamla el-Tantawi, 65, said she was voting "against what I'm seeing" ? and she gestured at a woman nearby wearing the niqab.
"I lose sleep thinking about my grandchildren and their future. They never saw the beautiful Egypt we did," she said, harkening back to a time decades ago when few women even wore headscarves covering their hair, much less the black niqab.
Many voters were under no illusions the turmoil would end.
"I don't trust the Brotherhood anymore and I don't trust the opposition either. We are forgotten, the most miserable and the first to suffer," said Azouz Ayesh, sitting with his neighbors as their cattle grazed in a nearby field in the Fayoum countryside.
He said a "yes" would bring stability and a "no" would mean no stability. But, he added, "I will vote against this constitution."
___
Associated Press writers Maggie Michael in Fayoum, Egypt, and Aya Batrawy, in Cairo, contributed to this report.
.
Source: http://news.yahoo.com/egypts-draft-charter-gets-yes-majority-vote-020049640.html
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For the sixth year, the Lions Club is hosting the annual "Support our Service People Walk."
The group will met at 5:30 p.m. on Christmas Eve, Dec. 24, at the Anne Frank Memorial, 777 S. 8th St. in Boise. A procession will end at the steps of the Idaho State Capitol. The program includes carols and an acknowledgement of Bowe Bergdahl, an Army soldier from Idaho who has been held captive by the Taliban since 2009.
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Hyundai Sonata engines are now imported for sale at GotEngines.com. This preowned motors dealers is selling the complete line of Hyundai variants and has imported these to its warehouse for direct sale online or offline with no additional import fees.
Hartford, Connecticut (PRWEB) December 20, 2012
GotEngines.com announces its acquisition and importing of Hyundai Sonata engines for direct sale online and offline. More information can be found at this link: http://www.gotengines.com/blog/hyundai-engines-sales/hyundai-sonata-engines-sale.This brand as well as Kia are now offered at reduced prices that are free of importation fees to customers. Theses motors are in preowned condition and receive thorough testing and evaluations before these are shipped to customers.
Foreign engines can be difficult to find online or through offline dealers due to the high costs involved to acquire these for sale. Some dealers do not have direct agreements with suppliers and pay additional fees to have a preowned motor in stock.
Distribution agreements are in place that allow faster and easier shipment to customers that use the GotEngines.com website.
The average domestic engine this is sold on the secondary market has between 90,000 and 135,000 miles on the block according to research. While these numbers do not provide indication of engine quality, the mileage ratios are different compared with those that are imported from foreign sources. Imports generally have 35,000 to 75,000 miles on the block although some dealers could have more or less.
The new imports that have been acquired for sale are ones that are on the lower end of the mileage spectrum to allow more car owners and motor installers in the U.S. and Canada to benefit. A new online quote system is helping to generate pricing entirely online for this inventory as well as the domestic inventory that is now in stock. This new measure is helping to eliminate the need to receive quotes by phone.
The in stock inventory can be searched online through the http://www.gotengines.com/blog homepage and complete warranty and shipping incentives are provided to help buyers make purchasing decisions.
About Got Engines
The Got Engines company was launched online in 2009 and now offers one of the largest preowned inventories of automotive, SUV and pickup truck engines that can be found online. By lowering pricing and improving warranty terms, this company has been able to extend its business operations into every U.S. state. Those that search for motors to purchase online use the online resources offered from the Got Engines website to find affordable motors. The lineup of Ford, Chevy, Dodge, Toyota, Hyundai and other import engines can be browsed online and ordered through the Internet or by toll free phone number.
Carl Lovitz
Got Engines
1-866-320-1065
Email Information
Source: http://news.yahoo.com/hyundai-sonata-engines-now-imported-sale-gotengines-com-050232398.html
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