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The Serbian Assembly has started the debate on the most important law of the year: the budget for 2021. Expenditures of 1,515 million dinars are forecast, while the expected income is slightly above 1,330 million, with a deficit in the treasury the state of about 180,000 million dinars.
Minister Siniša Mali is convinced that such a budget deficit will not be a problem to finance, while the Fiscal Council warns that the budget is based on the optimistic assumption that gross domestic product growth in 2021 will be six percent, and that it is easily possible for income to fall. significantly higher than the expected three percent of GDP.
With the economy affected by the epidemic, the Minister of Finance will try to reactivate the old medicine of increased public spending, which, in theory, should therefore stimulate production, trade and services.
Starting January 1, pensions will increase by 5.9 percent, salaries in the public sector by 3.5 percent, salaries of medical workers by 5 percent, and the entire package of 330 thousand million dinars will be set aside for capital investments. Thus, the budget costs for 2021 rose by 45 billion dinars more than the expected revenue at the end of this year.
“I heard several criticisms and that was the biggest criticism of the Fiscal Council, they say, they did not pay attention to salaries and pensions. Salaries and pensions increased a lot, considering how the economy is. They are not right, gentlemen. Our priority is to increase” . “Salaries and pensions while maintaining macroeconomic stability. Nor are we going to endanger that macroeconomic stability,” said Finance Minister Sinisa Mali.
The Fiscal Council responds that there is a problem in maintaining macroeconomic stability. The independent body cautions that the budget is based on an overly optimistic assumption that economic growth will be six percent of GDP, and that if that is not the case, the deficit in the state treasury may be significantly higher than 180. billion dinars.
“The problem is that if the black scenario occurs, the growth will not be 6 percent, but 3 as the World Bank predicts 4.5 as the European Commission said. Then we will have a larger deficit and we have not left room in the budget for programs larger to support the private sector. ” said a member of the Fiscal Council, Nikola Altiparmakov.
The opposition, which boycotted the June elections, raises the question of why the government plans to obtain a loan for the national stadium in the expected year of crisis, why government costs have risen from two to 42 billion dinars and why the airport in Trebinje, Bosnia and Herzegovina. They are allocating billions of dinars to Herzegovina.
“In a country where we treat children with SMS messages, who will allow us to waste hundreds of billions of dinars on these things? And while we wait for the citizens to raise money for sick children. This government is behaving as in the title of that series “The town is burning, and the grandmother is” While the state burns, they have fun, “said Miroslav Aleksic of the Popular Party.
The opposition criticizes the reduction of subsidies to farmers by two percent and warns that the fact that the benefits for the Anti-Corruption Agency are reduced speaks of the government’s commitment to the fight against corruption.
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