When discussing the issue of the growth of the Armenian foreign debt the officials and economists of the government say that it does not matter how much the debt is, the important thing is how these resources are being used.
It would be logical and better if the government organized public discussions and provide more information on how the financial resources are going to be used. However it turns out that the government is the one that will manage the expenditure of these financial resources and people will be informed about the projects implemented and how this money was spent only after having it finished.
The government has failed to collect taxes with the planned capacities, thus they have to take foreign borrowings from Russia, IMF and WB. On the other hand, according to the budget law the government can re-distribute 3% of the expenses to other sectors as deemed necessary for escaping from cutting budget expenditure. The government has decided not to use this right of reallocation of the 3% of the budget. “During this year the government has taken foreign borrowings, thus it means that the government should provide financial support for the implementation of the programs. These borrowings that were adopted in the parliament this year were not envisaged in the budget because the budget was adopted in December 2009. The government had to recruit financial resources through re-allocation in order to provide financial support. This 3% was not enough for the government, thus the government brought up a law to make an exemption and allow this mark of 3% exceed the allowed level only for this year,” said the minister of finances Samvel Safaryan at the parliament. The problem is that the legislative body will never know how this money would be spent. “As a result of this law amendment the government is getting an opportunity to do whatever they want without any control over their activities, especially in case when we know a lot of examples of bad decisions on part of the government,” said Heritage faction head Stepan Safaryan. The minister opposed to this observation. “The government is faced with a law preventing it from re-allocation without the parliament. Now we are applying to you and asking you let us do co-financing. Does it mean that the government wants to be out of control? I would not agree with such observation,” said P. Safaryan. The head of the NA standing committee on environmental protection Khachik Harutyunyan says the problem is that the parliament adopts financial plans for specific projects and expenses, but the government takes borrowings with a general explanation and information, which does not allow the parliament understand which specific sectors and goals the money will be spent on. MP Anahit Bakhshyan says that she does not understand it either what the borrowings will be spent on either. In answer to a question when the MPs could know about the specific projects on which the money would be spent the minister said they would learn about it in the beginning of 2010 when the implementation draft of the budget is presented at the parliament. It is not a secret that the government spends the involved financial resources very effectively; even the discoveries of the controller commission shows how effective they are. Currently the situation is different and different ministries are providing different information on the same financial plans. Recently the ministry of finances announced that 910 billion dram would be spent in 2009 (less by 35 billion), but the government had announced that some expenses would be removed to the 3rd and 4th quarters. As no sequestration of the budget has been done, we can’t know which expenses specifically were removed from the first quarter to the fall, or which ones will be cancelled. We may assume that the government itself has not understood which expenses to delay or which ones to cancel. For example, Mrs. Bakhshyan was informed that some part of the planned expenses to reconstruct schools would not be done and tried to find out whether the expenses had been delayed or cancelled. The answer of the minister of finances as of June 1 mentions that the expenses had not been cancelled but delayed according to a timeline. Furthermore, the answer of the minister of city construction as of June 17 mentioned that these expenses had totally been cancelled due to the decision of the government dated March 26. In a word, the right hand does not know what the left hand is doing.