Caracas, October 28 (teleSUR-RHC)-- Venezuela's National Assembly has approved the first reading of the 2016 federal budget.  Forty- two percent of the budget is devoted to social spending such as education, health care and programs to alleviate poverty, according to Finance Minister Rodolfo Marco.

Seven percent of the budget is earmarked for health care, while education will receive 14 percent of the overall pie.

The budget is based on an estimate of US$40 a barrel for the foreseeable future.  Oil is the Venezuelan government's largest source of revenue, and international prices are currently hovering between US$40 and 50 a barrel.

The budget was welcomed by legislators, including the socialist party's (PSUV) Jesus Faria, who described it as a key instrument for “the planning and development of the nation.”

“Nowadays development is for the people; now development is a part of our national sovereignty, for integration, and for the will of the popular power and economic sovereignty,” he said.

The budget still has to pass a second reading scheduled for early December, though it’s widely expected to easily sail through the assembly.

Despite falls in oil revenue, over the past year Venezuela's government has maintained its social programs, and continued to reduce extreme poverty.  In March, the government announced extreme poverty had hit a record low of 5.4 percent.

That figure had dropped from 5.5 percent in 2014, falling despite an economic slowdown caused by economic sabotage and falling oil prices.  This means that more than 36,300 people escaped critical levels of poverty in 2014.

The figures are the latest milestone in poverty reduction in Venezuela, following the prioritizing of social investment. When former President Hugo Chavez came to power in 1998, 21 percent of homes were registered as experiencing extreme poverty and earlier that decade as economic crisis hit Venezuela extreme poverty topped 42 percent.

The objective of the socialist government’s policy is to reduce the extreme poverty index to zero in 2019.