Azernews.Az

BAKU – A bill on changes to Azerbaijan's 2011 budget aiming to increase revenues and the government’s spending on social security and other key areas has been put on discussion in the country’s parliament, the finance ministry said Thursday.

This year’s state budget is to be adjusted due to President Ilham Aliyev’s orders to provide additional funds for the measures seeking to improve the social security of citizens. The measure primarily aims to further reforms in the country’s pension system, increase the wages of employees in budget-funded institutions, allowances and scholarships, as well as to finance a number of social and infrastructure investment projects, the ministry said in a statement.

It said the planned activities and projects will cost 3.1 billion manats (almost $3.9 billion). The state of the world oil market remains favorable and, as a result, Azerbaijani oil is selling for a price exceeding the one set in the country’s 2011 budget by 80 percent, the ministry said.

In the first quarter of 2011, additional revenues of the Azerbaijani state oil fund Sofaz amounted to 976.4 million manats ($1.228 billion), considerably above the projected 193.5 million manats.

The government says that given the favorable conditions in oil markets, Sofaz is expected to receive further additional revenues. Under the amended draft of the state budget submitted to the Milli Majlis for consideration, the price of oil was indicated at $80 a barrel instead of the previously approved $60.

The bill envisions increasing projected budget revenues by over 3.493bn manats ($4.393bn), or 29 percent, to 15.554bn manats (19.564bn). The revenues will be increased on account of raising tax and customs transfers by around $970 million and by $3.4bn on account of Sofaz transfers.

According to the draft law, budgetary expenses this year exceed 15.9bn manats ($20bn), 25 pct over the projection. After the increase, current expenses will account for 48.4 pct of total spending, while capital expenditure for 49.4 pct, and expenses on clearing state debt will make up the remaining 2.2 pct.

Additional revenues are expected to help reduce this year’s state budget deficit to $486 million.