The 2018 budget under debate
The state budget for 2018 is being debated in Romanias Parliament, first in the expert committees and then in the joint budget and finance committees.
Mihai Pelin, 13.12.2017, 13:47
The 2018 state and social security bills are being debated in the joint budget and finance committees of Romania’s Parliament, with the final vote on the bills scheduled for December 21. The authorities count on revenues almost 6.6 billion Euros higher than last year, to be split between healthcare, education and investments.
The Finance Minister Ionuţ Mişa pointed out that the budget for 2018 was based on a 5.5% economic growth rate, a 3.1% inflation rate, an average exchange rate of 4.55 lei for the Euro and an increase in the average number of employees by 4.2%.
Ionuţ Mişa believes that the revenues taken into account in drafting the budget are realistic: “During 2017, we had an increase in revenues of 12.85 billion lei for a 10-month period as compared to 2016. If we take this revenue growth as a reference figure, I don’t think that anyone can claim that revenues are not sustainable in 2018.”
The opposition, however, says that the budget revenues are overestimated. Florin Cîţu is a senator with the National Liberal Party: “According to my own estimates, revenues are overestimated by almost 8.6 billion lei, of which 5 billion in relation to the collection of the VAT. Apart from the VAT, there is one more budget component with overstated revenues, namely social contributions.”
The Finance Minister says that, besides certain measures that lead to an increase in expenses such as pay rises, holidays vouchers, the rise in minimum wages, in pensions and in social benefits for pensioners, the budget also provides for measures to cap expenses. The opposition has filed almost 4 thousand amendments, but the greatest part of the budgets for ministries and the main credit release authorities have been approved by the expert’s committees in the form proposed by the Government.
The National Defense Ministry received 2% of the GDP according to the commitment Romania made to NATO. In 2018 the budget of the Healthcare Ministry will be 4.6% higher than in 2017, with the biggest increase planned for medical staff salary expenses. The budget of the Education Ministry will account for 3% of the GDP in 2018 as against 2.9% at present. The Romanian Intelligence Service will also receive 13% more funds in 2018 than in the previous year. The budgets of the Interior and the Regional Development Ministries were also approved, the latter with amendments.
The Democratic Union of Ethnic Hungarians in Romania proposed an increase in the share from the income tax that is due to the local authorities, given that this tax will drop from 16% to 10% starting on January 1, 2018.
