- Under the new rules, ministries and government bodies will not be allowed to submit additional budget requests after their draft budgets have been presented to the Ministry of Finance. The circular also reaffirmed the Cabinet’s decision prohibiting supplementary financial requests beyond the ministry’s approved expenditure estimates.
- The approach aims to improve financial planning, optimize the allocation of public resources, and support economic, social, and security objectives while enhancing public services.
- Any request to revise project costs must include clear justifications, and no amendment will take effect without the ministry’s approval.
The Ministry of Finance has issued a new circular outlining the rules and guidelines for ministries, government departments, and affiliated agencies to prepare their draft budgets for the 2027/2028 fiscal year, with a strong emphasis on fiscal discipline, expenditure control, and revenue enhancement.
The ministry said all government entities must prepare their budget proposals within expenditure ceilings that will be assigned individually by the Ministry of Finance. Agencies have also been instructed to reduce unnecessary spending, rationalize expenditures, and increase government revenues without affecting the quality of public services.
The circular stressed the need to achieve a balance between maintaining essential services for citizens and ensuring efficient use of financial and human resources.
Government entities have been directed to implement measures aimed at reducing waste, improving spending efficiency, strengthening revenue collection, and allocating resources to projects that serve national priorities.
The ministry also instructed agencies to continue implementing Circular No. 3 of 2022 governing non-financial assets, including stricter control over government-owned assets, proper registration and maintenance, and improved planning for future asset requirements to maximize their utilization.
Under the new rules, ministries and government bodies will not be allowed to submit additional budget requests after their draft budgets have been presented to the Ministry of Finance. The circular also reaffirmed the Cabinet’s decision prohibiting supplementary financial requests beyond the ministry’s approved expenditure estimates.
The ministry confirmed that Kuwait will continue applying its three-year budget planning framework, in line with Cabinet decisions on medium-term fiscal planning.
The approach aims to improve financial planning, optimize the allocation of public resources, and support economic, social, and security objectives while enhancing public services.
Government entities must adhere to the expenditure ceilings set by the ministry. If an agency believes additional funding is required, it must first submit its budget within the approved ceiling before discussing any justified increase with the Ministry of Finance.
The circular outlined several priorities for budget preparation, including tighter control over expenditures without reducing service quality, estimating new recruitment needs and adhering to those estimates throughout the fiscal year, prioritizing construction projects and contracts, reviewing and increasing government service fees in line with Decree Law No. 1 of 2025, improving government revenue collection, and recovering outstanding public debts.
Government agencies have also been instructed to prepare indicative budgets for the 2028/2029 and 2029/2030 fiscal years. These projections must remain within the expenditure limits proposed for the 2027/2028 budget and follow the ministry’s three-year budgeting framework.
Regarding development projects, the ministry directed agencies to prepare detailed implementation plans showing project priorities, funding requirements, execution schedules, and implementation capacity. The explanatory memorandum accompanying each budget must also include updates on the progress of ongoing projects.
The circular stipulated that no new construction projects will be included in the budget unless land has been officially allocated by Kuwait Municipality.
Agencies must also coordinate with the municipality on strategic projects, conduct feasibility studies for major developments in cooperation with the Ministry of Finance, and complete all technical studies and approvals before requesting financial allocations.
The ministry further instructed that projects lacking engineering studies, feasibility assessments, or approvals from relevant authorities should not receive budget allocations. Agencies must also coordinate with utility providers and other service authorities before launching new projects.
For projects already under implementation, the ministry said funding requests must remain within approved project costs and implementation schedules while reflecting actual spending rates and execution progress.
Government entities must ensure all contractor payments are settled before removing projects from the budget and provide detailed reports on project progress, financial obligations, and any proposed modifications.
The circular also reaffirmed Cabinet decisions regulating change orders for construction projects, stating that no amendments leading to higher project costs may be made after designs have been approved and implementation has begun unless prior approval is obtained from the Ministry of Finance.
Any request to revise project costs must include clear justifications, and no amendment will take effect without the ministry’s approval.
