LY PRESIDENT WANG ON SPECIAL BUDGET

C O N F I D E N T I A L TAIPEI 003141

SIPDIS

STATE PASS AIT/W

E.O. 12958: DECL: 10/07/2014
TAGS: PGOV PREL TW
SUBJECT: LY PRESIDENT WANG ON SPECIAL BUDGET


Classified By: AIT Deputy Director David Keegan, Reasons: 1.4 (B/D)


1. (C) At a October 6 meeting at his reception house,
Legislative Yuan (LY) President Wang Jin-pyng told AIT that,
with the LY expected to recess in November in order to
release its members for the December 11 election campaign,
there is not enough time to debate the Chen administration's
proposed budget to purchase advance defense systems.


2. (C) Moreover, Wang pointed out that the cost needs to be
reduced. He said that National Defense Minister Lee Jye had
updated him October 5 on the progress of the negotiations
between the Taiwan Ministry of National Defense (MND) and
U.S. Department of Defense. Wang said that he has told Lee
that the MND should hold further negotiations on the price
before the LY reviews the budget to authorize the purchase.
Wang intends also to discuss the issue further with PFP
Legislator Lin Yu-fang, DPP Legislator Lee Wen-chung, and the
MND's Vice Admiral Lei Kuang-shuh, all of whom accompanied
Wang to the U.S. in June 2004.


3. (C) Wang emphasized that the position of the KMT has not
changed since his previous conversation with AIT in July

2004. The KMT will support the Special Budget but will
continue to seek political advantage by fighting over the
price and details. When AIT suggested that the LY consider
taking a "two step" approach by approving the proposal first
then allocating funds at a later time, Wang replied that the
LY needs to allocate funds at the same time that it approves
the package.


4. (C) Comment: Wang's comments to AIT and his recent public
statements indicate in fairly clear terms a decision by the
KMT to postpone consideration of the budget until after the
December 11 election. Pan-Blue officials have assured AIT
that the LY will take positive action on the bill during the
lame duck session that is expected to run though mid-January.
However, MND officials fear that post-election confusion
within the Pan-Blue camp may force the budget into the first
session of the next LY which begins in February. Septel will
report on Wang's assessment of the current political climate.
End Comment.
PAAL