The first budget revision in 2017
More funds have been earmarked for domains where pay rises have been granted.
Ştefan Stoica, 14.09.2017, 13:49
Amidst growing concern about the real state of the country’s economy and its finances, expressed by experts and the opposition, the left of centre Government in Bucharest has approved the first budget revision this year, in a move meant to dispel fears of prospective budgetary turmoil.
Finance minister Ionuţ Mişa says it is a positive revision and explains why: “The 5.8% economic growth rate registered in the first half of the year has led to the positive revision of the economic growth rate registered in 2017, from 5.2%, the figure taken into consideration when the budget was drafted at the start of the year 2017, to 5.6%. Under these circumstances, the government makes a positive budget revision, maintaining the budget deficit at 2.96%of the GDP.”
More funds have been allotted to cover pay rises, whereas the sums of money allotted to projects with European financing have been cut. Minister Ionuţ Mişa: ”I would like to mention that cuts have been operated mainly in the case of the amounts granted for projects with European financing, because the 2017 state budget was approved rather late and procurement procedures have been delayed, which have caused a poor budget implementation in the first eight months of the year.”
The budgets of local administrations will be supplemented, to cover expenses with the payment of the teaching staff in higher secondary education, of the people accompanying disabled persons, and to fund school programs. The Health Ministry will receive more funds for the payment of the medical staff, just like the Interior Ministry, for the payment of salaries and of the policemen’s pensions. Agriculture will also receive more money. There are also ministries that will receive less money, such as the Regional Development Ministry, the Transport Ministry and the Communication Ministry. From the opposition, the Save Romania Union called on the Government to come up with budget revision solutions to place the country’s expenses on a real economic basis. The aforementioned party claims the ruling coalition made up of the Social Democratic Party and the Alliance of Liberals and Democrats in Romania is manipulating budget figures to present to the public a positive budget revision, showing the state’s revenues and expenditure are on the rise.
The Save Romania Union points an accusatory finger saying that in reality the budget revenues and expenditure are following a downward trend, reflecting the disastrous situation of public finances. In its turn, the Fiscal Council, a government body which has the role of counselling the authorities in order to have a “healthy” budget, says it has identified, in the budget revision, elements which suggest the vulnerability of public finances on medium term and recommends to the Government to urgently come up with a plan of measures.
According to the Fiscal Council, the economic growth rate that has exceeded expectations has however failed to achieve the convergence between fiscal revenues and the envisaged targets, and the budget execution has significantly exceeded initial assessments of the funds that will be necessary to supplement current expenditures.
