2005 News Story

King Abdullah announces state budget for FY2006

Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz announced the state budget for the fiscal year 1426/1427 [FY2006] while chairing today’s Cabinet meeting. The budget totaled SR 335 billion [US $89.3 billion], the largest in the Kingdom’s history, according to a statement by Minister of Culture and Information Iyad Madani.

King Abdullah said that the budget takes into account the importance of accelerating completion of the development programs and projects, especially those that extend essential services to citizens. At the same time, he noted, the budget also takes into account the continuing reduction of the national deficit, which is down to SR 475 billion [$126.7 billion].

The budget includes new projects with an estimated cost of about SR 126 billion [$33.6 billion], the King said.

For education, 26 percent of the budget for FY2006 has been allocated to general and higher education as well as technical and vocational training for boys and girls. There will be new scholarships for specializations in the modern sciences, the King said. A variety of educational and training programs are also included in the new budget, including the establishment of some 2,700 new schools for boys and girls, the opening of three new universities in Jazan, Hail and Al-Jouf. Existing universities will be expanded to include 85 new colleges, three university hospitals (as well as expansions of the existing university hospitals), and 35 technical and vocational institutions.

For health care, the budget includes establishing 440 primary health care centers throughout the Kingdom, 24 new hospitals, and the expansion of existing health care facilities.

Regarding municipal projects, the budget includes funding for the development of municipal services, including projects related to rain-water drainage and the establishment of new streets. The budget also provides for the implementation of a number of dams as well as water and sewage services, and 5,700 km [3539.7 miles] of new roads.

Also included in the budget are developments in data technology, government and electronic services, as well as programs to support the agricultural sector, the King said.

King Abdullah called on all officials to accelerate the implementation of the projects included in the new budget in the specified time frame so that the services will be available to citizens. He also urged the Cabinet to implement the budget quickly.

Appropriations for the main development and public service sectors for 1426/1427 [FY2006] are as follows:

1. Education and manpower development:
Expenditure, SR 87.3 billion [$23.3 billion]; new projects, SR 24.85 billion [$6.6 billion]. Vocational training programs will continue as planned.

2. Health and Social Affairs:
Expenditure, SR 31 billion [$8.3 billion] for new health projects. The bed capacity of governmental hospitals will be increased by 29 percent.
For social affairs, allocations for housing projects throughout the Kingdom will be increased to SR10 billion [$2.7 billion], and the maximum limit for a family’s annual social insurance will increase from SR 16,200 [$4,319] to SR 28,000 [$7,466].

3. Municipal Services:
Expenditure, SR 13.4 billion [$3.6 billion].

4. Transportation and Telecommunication:
Expenditure, SR 11.5 billion [$3.1 billion].
The total cost of new highways is estimated at SR 7.8 billion [$2.1 billion]. New projects include 6,000 km [3,726 miles] of roads. There are 12,000 km [7452] of roads currently under construction.
Also, SR 1.4 billion [$373 million] has been allocated for new projects including ports, airports, and railroad development and new postal services.

5. Water, Industry, Agriculture, Infrastructure and other Economic Sectors:
Expenditure, SR 22.5 billion [$5.9 billion].
New projects include water, sewage, dams, digging wells, pumping and purification stations, and water desalination projects amounting to SR 13 billion [$3.5 billion].
In the agricultural sector, the budget includes new projects to set up animal and plant laboratories and quarantines as well as the provision of fishing boats.
To increase local investments and attract foreign investments, the budget includes new projects in Jubail and Yanbu Industrial Cities at a cost SR 5 billion [$1.3 billion] in an area of 87 million square meters.

6. Specialized Development Funds and Government Financing Programs:
The capital of the Real Estate Development Fund will be increased by SR 9 billion [$2.4 billion] for a total of SR 92 billion [$24.5 billion], and the Saudi Credit Bank by SR 3 billion [$799.9 million] for a total of SR 6 billion [$1.6 billion] to support limited income citizens in addition to small and medium businesses; and the Industrial Development Fund will increase SR 13 billion [$3.5 billion] to SR 20 billion [$5.3 billion].
The budget also includes funds for lending programs for universities, colleges and private schools.