No compromise on debt servicing despite 14 pc cut in Dubai budget size

Salaries, wages too witnessed marginal increase in allocation

DUBAI/December 28-2020: The downsizing of the 2021 budget of Dubai Government by 14 per cent to AED57.1 billion compared with last year’s expenditure projection of AED66.4 billion has not dent the debt servicing exercise as well as the spending on salary and wages of the government employees for 2021.

But on the contrary, the allocation for debt servicing and wages for employees have found increase in the new budget not only on percentage basis but even on absolute terms.

While the debt servicing has been increased from five per cent to six per cent of the expenditure for 2021, this has increased from AED3.32 billion to AED3.43 billion on absolute terms too, between 2020 and 2021.

Debt servicing allocation up

Likewise, the spending on salary and wages for the government employees has been increased from 30 per cent to 35 per cent of the budget expense. On absolute terms, this has expanded marginally from AED19.92 billion to AED19.99 billion for 2021.

On the debt servicing, the government said it is following a disciplined fiscal policy that ensures that the budget fulfils all obligations.


The 2021 budget that is projected to run a deficit of AED4.786 billion against the expected revenue of AED52.314 billion, aims to generate about AED30.87 billion from non-tax revenue, which accounts for 59 per cent of the projected revenue.

On the other hand, the non-tax revenue projection for the previous year (2020) was much higher at AED41.02 billion that accounted for 60 per cent of the projected revenue at AED68.36 billion that boasted a surplus of AED1.96 billion.

Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, approved the budget on Sunday.

A statement from the Finance Department observed that the newly-announced budget takes into account the “exceptional” economic conditions of the fiscal year 2020 and the repercussions of the Covid-19 pandemic on the global economy.

Obviously, a lot of belt tightening has been necessitated by the contraction of revenues like in most economies, thanks to COVID 19 that posed various challenges to the world economy.

Dubai’s Strategic Plan 2021

Abdulrahman Saleh Al Saleh, Director General of the Department of Finance of the Government of Dubai (DOF), said Dubai’s Strategic Plan 2021 is a key pillar in Dubai’s journey towards the future.

The Finance Department statement said Dubai’s new budget will continue to support social, health, educational and cultural services as well as investments in infrastructure services in the emirate, as part of the objective of making Dubai one of the world’s best cities to live in.

DOF also said it seeks to develop programmes that aim to raise government spending efficiency and promote partnerships with the private sector

It  said the government seeks to expand the outsourcing of services to the private sector to enhance its engagement in economic development, which will contribute to improving the well-being and happiness of citizens and residents.


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