Social development remains a priority in UAE budget
dubai — The UAE will spend a large chunk of its 2021 budget on social development, followed by government affairs and federal project expenditures.
Analysts and experts said the budget allocations are mostly in line with the last year. They also pointed out that 2021 is the last year of the UAE government’s five-year plan (2017-21).
The UAE Cabinet, headed by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, on Sunday approved a Dh58.1 billion budget for 2021 with development of vital national projects remaining a priority for the government.
“The federal budget for 2021 was in accordance with the best international standards and applied the latest electronic systems, to improve expenditure efficiency and direct spending towards strategically important sectors. That, in addition to enhancing government entities’ ability to implement and achieve their goals and programmes with the required efficiency,” said Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and Minister of Finance.
Sheikh Hamdan said the main objectives of preparing the federal budget in the form of periodic plans are to improve the level of social services provided; focus on upgrading smart government services and increasing the level of customer satisfaction; and highlight the efforts of the federal government to provide welfare, prosperity, happiness and security for all community members.
Khatija Haque, head of research and chief economist at Emirates NBD Research, said the federal budget has run a surplus in first half of 2020.
“It is also a relatively small proportion of overall UAE spending, which we expect to reach Dh450 billion this year, and rise to Dh466 billion in 2021,” she said.
Lalu Samuel, chairman and managing director of Kingston Holdings, said the budget reflects resil
ience of the UAE economy and the financial strength of the country’s future plans. It does also highlight the fact that the UAE economy is pressing ahead towards further growth and prosperity.
“This will undoubtedly give a strong impetus to local and foreign investors to increase their investments and projects,” he said.
A breakdown of the budget showed that UAE allocated Dh26.04 billion, or 42.6 per cent, to social development, and Dh9.6 billion, or 15.7 per cent, for the education sector.
Within education, the government has allocated Dh6.2 billion (10.2 per cent) for public education programmes and Dh3.4 billion (5.5 per cent) for higher and university programmes. It allocated Dh4.97 billion (8.1 per cent) for healthcare and disease prevention, as well as funds to mitigate the Covid-19 pandemic.
The federal government will spend Dh3.4 billion
(5.6 per cent) for social rights and activating community integration to support and provide subsidies to special groups and Dh4.6 billion for pensions.
The government has announced the allocation of Dh21.3 billion, or 34.8 per cent, to run government affairs, Dh4.5 billion for infrastructure, Dh19.3 for social development and Dh4.6 billion for social welfares. In addition, Dh7.7 billion will be spent on federal expenditures and Dh3.1 billion for financial assets and investments.
Of the Dh3.93 billion federal projects, Dh1.4 billion to be used to fund the UAE railway network, Dh126 million for the UAE Space Agency and Dh963 million for infrastructure development.
The Ministry of Finance said federal entities have updated their draft budgets for the fiscal year 2021 in the automated budget preparation system within the five-year plan.