Budget cuts
NZPA-AP Washington President Reagan has ordered the first round of spending cuts under a new Budget-trimming law, totalling SUSII.7 billion.
The cuts of 4.3 per cent for domestic programmes and 4.9 per cent for the military, will take effect on March 1. Under the GrammRudman Budget-balanc-ing law passed by Congress last year, the President is bound to follow the cuts outlined in January by the country’s comptroller.
The Justice Department has challenged the constitutionality of this delegation of authority to the comptroller, and this
case is awaiting a decision by a court. From fiscal 1987 on, automatic cuts will be made if Congress falls to reduce the deficit to targets specified by the Gramm-Rudman law, which is designed to balance the Federal Budget by 1991.
The President exempted military personnel from this year’s cutbacks, but otherwise, White House officials said, he would not attempt to shield defence programmes from the cuts.
The President’s order affects spending in fiscal 1986, while the budget he will send to Congress on Wednesday will deal with fiscal 1987 spending.
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Press, 3 February 1986, Page 30
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177Budget cuts Press, 3 February 1986, Page 30
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