THE DEFICIT of public finances should stand at 1.98 percent of GDP next year, with the prospect of it falling to 1.43 percent in 2016 and to 0.39 percent in 2017, according to the draft budget of the public administration for the upcoming years passed by the government during its October 15 session.
The cabinet will now send the draft to the parliament and also to the European Commission, the TASR newswire reported.
According to the draft, the total expenses should stand at €16.6 billion next year, down by €756 million compared to this year. The total incomes are expected to be €14.2 billion.
Moreover, the public debt will stay below 55 percent of GDP. It is expected to stand at 54.4 percent next year and gradually drop to 51 percent in 2017. The state debt, without counting the influence of international commitments, will be below 50 percent of GDP, as reported by TASR.
The Finance Ministry also expects the Slovak economy will grow at 2.4 percent this year, while it will accelerate to 2.6 percent in 2015, and to 3.5 percent in 2016 and 2017.
“The continuing improvement of situation in the market will lead to stabilisation of the rise in consumption of households,” the ministry said, as quoted by TASR. “On the other hand, the consolidation of the public finances necessary for meeting the budget aims will lead to a significant drop in consumption of the public administration.”
The employment rate in 2015 should increase by 0.4 percent, according to the draft, with the most positive development expected in market services and industry. The jobless rate is expected to drop to about 13 percent next year. This will be also the result of the slight decrease in the number of economically active people, the Finance Ministry said, as reported by TASR.
The real monthly wage should rise by 2.1 percent, which will correspond with the rise in productivity. The draft budget does not count with valorising the salaries of members of the government in 2015-2017.
“Regarding the constitutional law on budget responsibility, the salaries of cabinet members will stay at the same level as in 2014,” the ministry explained, as quoted by TASR.
The budget draft for 2015 also predicts that the public sector will employ about 360,000 people.
“The annual increase in the number of employees by about 16,000 is a result of the methodological change, within which new organisations are added to the subjects of public administration,” the ministry said, as quoted by TASR, adding that without this influence the employment in public sector would drop by 3,314 people year-on-year.
The Finance Ministry also said that the budget draft is influenced by the measures of the constitutional law on budget responsibility. Moreover, based on new European methodology, it also contains, for the first time, new subjects that are now considered to belong to the public administration, like the National Highway Company, Železnice SR, transport companies of Bratislava, Košice, Banská Bystrica and Žilina cities, the Emergency Oil Stocks Agency, and Eximbanka.
This change automatically, without any governmental interferences, increases the consolidated expenses of the public administration in 2015 compared to the budget for 2014, the ministry explained, as reported by TASR.
Compiled by Radka Minarechová from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.
15. Oct 2014 at 14:00