Riyadh – Mubasher: Jadwa Investment said that the Fiscal Balance Programme (FBP) is likely to save SAR 100 billion in 2017 alone.
The reduction in public sector worker allowances and wage freeze, adding to energy price reform will contribute to 55% and 29% of 2017 gross savings, respectively.
Moreover, new measures to enhance the efficiency of spending and raise non-oil revenues will also participate in the savings by 12% and 4%, respectively, according to the report.
"We believe that the government has already incorporated these savings into the 2017 budget, and therefore are confident of the government delivering on reforms. These initiatives will help in keeping total government spending in an expansionary mode from 2018 to 2020," Jadwa stated.
Planned fiscal measures are estimated to empower the government from saving around SAR 362 billion, leading to a fiscal surplus of SAR 162 billion by 2020, the report added.
Along with the 2017 budget statement, the government announced details of the FBP, one of the Vision 2030 programmes, which targets enhancing spending efficiency, reforming energy prices, and promoting non-oil revenues.
Jadwa expected forecast taxes and fees to rise from SAR 91 billion in 2016 to SAR 168 billion by 2020.
"Meanwhile, we forecast non-tax revenue, which is mainly dominated by transfers of returns from public investment vehicles, to rise from SAR 108 billion in 2016 to SAR 153 billion by 2020," the investment firm noted.
