Huge cut to defense spending will fund social aid in 2008 state budget

Prime Minister Lado Gurgenidze promised yesterday that the Georgia will have a GEL 275 000 budget surplus next year, as the country dramatically realigns its spending priorities.

“We’ll have a budget surplus for the first time in Georgia’s history,” Gurgenidze declared.

The government submitted a first draft of the 2008 budget to parliament in October, but withdrew it after then-president Mikheil Saakashvili appointed Gurgenidze to the prime minister’s post in November and promised to refocus state spending on social programs.

Parliament is expected to approve the new draft budget by next week.

The prime minister said all the social programs the government has recently proposed, which range from increased pensions to one-off aid vouchers, are accounted for in the new budget.

The rebalancing of priorities will cut heavily into defense spending, Defense Minister Davit Kezerashvili told journalists. His ministry’s budget will fall by some GEL 400 million, while the same amount will be tacked onto the state healthcare budget, bringing its total up to GEL 1.3 billion.

In 2007, defense spending accounted for nearly a quarter of the state budget.

“The 2008 budget is wholly focused on social problems, and the main goal of the government is to resolve those problems and fight poverty,” Minister of Health, Labor and Social Affairs Davit Tkeshelashvili told journalists the same day.

Ruling party presidential candidate Mikheil Saakashvili is campaigning for reelection on a slogan of “Georgia without poverty.”

The new draft budget comes as opposition politicians accuse Saakashvili of misusing state funding for personal and campaign expenses. None have so far offered proof of direct misappropriation.