A proposal to maintain the current year budget as a continuing budget until the new administration takes office next year was submitted to Senate during its Fifteenth Regular Session this month.
The bill titled “Fiscal Year 2021 Continuing Budget Authority Act” states that “it is the longstanding practice in the Republic of Palau to allow an incoming government, both Executive and Legislative, to set its own economic development and fiscal management policies.”
Furthermore, it states, “In light of the developing COVID-19 international economic crisis this tradition is more important than ever.” FY 2020 Unified Budget that this continuing budget resolution is based on was initially passed at $92 million and after two supplementals increased to over $100 million dollars.
The local revenue source for FY 2020 budget was projected at $65 million but this is expected to drop by over $40 million next year according to the latest study by ADB.
FY 2021 Continuing Budget Resolution will last until the new administration comes up with a new budget.
“The incoming government should have the maximum possible discretion to develop a budget that is responsive to the current situation in the Republic and around the world,” according to the bill.