The government of Romania has wrapped up the discussions on the first budget revision this year, which provides for additional allocations of RON 22.8 billion (EUR 4.5 billion) or over 1% of GDP in net terms, and a deficit target of 8.4% of GDP, according to sources consulted by Bursa.ro. The document is to be adopted on September 30 in an extraordinary session of the executive.
Finance minister Alexandru Nazare disclosed that the new net primary expenditure trajectory (the main benchmark followed by the European Commission under the Excessive Deficit Procedure) set by the European Commission in July was consistent with a deficit of 7.7% of GDP this year, which could not be observed because of supplementary expenditures.
According to the presentation made by minister Nazare, the rectification ensures the full payment of salaries, pensions, allowances, and other social expenses until the end of the year, as well as the payment of outstanding investment invoices.
“Through this revision, we fully cover all essential needs. We are talking about pensions, salaries, and social assistance. All these needs are covered and all three mean around RON 10 billion,” Nazare said, as quoted by Hotnews.ro.
Among the recipients of supplementary funds stands out the Ministry of Finance with RON 18.3 billion, of which RON 12.1 billion (EUR 2.4 billion or 0.64% of GDP) is for interest on public debt. The interest payments were initially estimated at RON 40 billion (2.1% of GDP).
In turn, the Ministry of European Funds had its budget cut by RON 3.2 billion. Also, the financing of political parties will be reduced by 10%.
The coalition leaders also decided that a new rectification will take place in November.
iulian@romania-insider.com
(Photo source: Edgars Sermulis/Dreamstime.com)
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