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President Signs Next Year's Budget
Friday 17 December 2010 Zoom in | Print page
Bratislava, December 17 (TASR) - President Ivan Gasparovic signed the state budget for 2011 on Friday, nine days after the law was approved by Parliament (on December 8).
The state budget deficit is set to fall from this year's €4.54 billion to €3.81 billion in 2011. Total state revenues will stand at €13.15 billion, while expenditures will reach €16.96 billion.
The bill was backed by 78 of the 147 MPs present, with 69 voting against. In line with expectations, it was supported by coalition MPs while all opposition legislators, who saw all seven of their proposed amendments rejected, voted against.
The legislation underwent small coalition-initiated changes in Parliament that cut the originally planned deficit from €3.83 billion to €3.81 billion. This was largely due to the inclusion of tax revenues stemming from the sale of surplus emission quotas, with the consequent extra revenues estimated at €96 million.
In addition, funds to be earmarked for the Transport, Posts and Telecommunications Ministry, which is headed by Christian Democrats (KDH) chairman Jan Figel, will be cut by €8.21 million. This is because Parliament recently rejected a proposal to raise excise-tax on beer, with four KDH MPs abstaining from the vote. It was then announced that a ministry under KDH's remit would have to make up the consequent shortfall in state budget revenues.
The Labour, Social Affairs and the Family Ministry also saw its expected funds cut. Due to saving measures, the ministry will receive €1.7 million less than originally planned.
In turn, the President's Office and the Parliament's Office will receive an extra €300,000 and €2.3 million in 2011, respectively.
The parliamentary debate on the bill lasted nearly two days, with opposition MPs heaping heavy criticism on the budget. According to former finance minister Jan Pociatek (Smer-SD), the budget poses a number of risks. The largest of these lies in the fact that the public-finance consolidation will be covered by the public, not the Cabinet, said Pociatek.
"People will pay for the consolidation through higher taxes, they will pay eight times as much as the Government will save," he said.
Incumbent Finance Minister Ivan Miklos (SDKU-DS) said that the consolidation efforts are designed in a way that will ensure the Slovak economy won't suffocate.
Miklos also rejected Pociatek's allegations that the consolidation will be paid for primarily by the public. The state will cover 60 percent, with the remainder coming from tax increases and an increase in GDP, said the minister.
Meanwhile, next year's expected price increases should be made up for by a rise in the average salary, said Miklos.
In line with the public administration budget for the next three years, which the House also discussed, the overall state administration deficit should fall from this year's €5.1 billion to €3.4 billion next year, with revenues reaching €23.3 billion and expenditures €26.7 billion.
The public finance deficit should fall gradually from the 7.8 percent of GDP reported this year to 4.9 percent in 2011 and 3.8 percent in 2012. In 2013, the state deficit should be pushed down to 2.9 percent, below the 3-percent threshold required by EU budgetary rules.
In an attempt to cut this year's deficit of nearly 8 percent to 4.9 percent next year, the Government has drawn up a package of consolidation measures worth €1.75 billion. The money should be acquired by a reduction in expenditures equalling €980 million and an increase in revenues of €770 million.
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