The local government is proposing to continue with its annual cash handout next year, according to the explanatory note of next year’s budget bill which has been submitted to the Legislative Assembly (AL) for debate, review and vote.
The debate and vote of the outline of the 2022 budget bill is scheduled to be held during a plenary session on Thursday.
According to the 2022 budget bill, which was released on the legislature’s website at the weekend, the government will continue to run a budget deficit.
After the passage of its outline by lawmakers, the bill will be reviewed by one of the legislature’s standing committees before it is resubmitted to another plenary session for its second and final debate and vote.
According to the bill, the government is proposing to allocate 30.3 billion patacas from the Macau Special Administrative Region’s (MSAR) extraordinary reserves so that it can to fill the deficit – i.e., to keep a formally balanced budget.
The 2022 budget bill’s explanatory note does not mention how much each local resident will receive for next year’s “wealth-sharing” handout.
The cash handout has been paid out by the government annually since 2008, when each permanent resident received 5,000 patacas while each non-permanent resident received 3,000 patacas. Since then, the amount had been gradually increased, before it reached 10,000 patacas for permanent residents and 6,000 patacas for non-permanent residents in 2019.
The amount of the handout for last year and this year remained unchanged at 10,000 patacas for permanent residents and 6,000 patacas for non-permanent residents.
Macau’s economy, which is heavily reliant on the gaming and tourism sectors, has been hard hit by the COVID-19 pandemic which started early last year, because of which the local government has been running a budget deficit since last year. It means that the government, according to the 2022 budget bill, would run a budget deficit for three consecutive years next year.
After the proposed 30.3-billion-pataca cash injection from the MSAR’s extraordinary reserves, the 2022 budget bill expects the government’s revenue to reach 100.1 billion patacas, while the government’s expenditure is budgeted at 99.4 billion patacas.
According to the bill explanatory’s note, the government expects the gaming industry to generate 130 billion patacas in gross gaming revenue (GGR) next year.
The explanatory note says that the gaming sector would still need a period of time to recover from the adverse impact caused by the COVID-19 pandemic on Macau’s economy.
The government is predicting that the situation of Macau’s economy next year would remain “critical”, the explanatory note says.
The government is also forecasting its direct gaming tax to amount to 45.5 billion patacas next year, according to the note.
In the explanatory note, the government says that without the proposed cash injection from the extraordinary reserves, its budgeted revenue next year would not be able to cover its budgeted expenditure, due to an expected decrease in its direct gaming tax, while the government would continue with the implementation of its various subsidies and benefits, as well as public infrastructure projects.
According to the 2022 budget bill’s explanatory note, the government expects to spend 8.39 billion patacas on its various welfare measures benefiting residents, such as cash handouts, health vouchers, subsidies to residential households’ electricity bills, and continuing education subsidies.
The government expects to spend 12.04 billion patacas on various other subsidies, allowances and benefits such as education fee allowances and various other allowances for the education sector, old-age pensions, disability pensions, and allowances for disadvantaged families.
Consequently, the explanatory note underlines, all the various subsidies, allowances and benefits are expected to cost the government 20.44 billion patacas next year.
Visitors and residents walk around the Ruins of St. Paul’s UNESCO World Heritage landmark early this month. Photo: MGTO
