The rules governing provisional budgets - that is, a situation in which the state budget for a given calendar year hasn't been approved - are to be made more moderate, according to an amendment tabled by coalition MP Daniel Karas (Smer-SD) to the amendment to the Public Administration Budgetary Rules Act.
The basic restriction, whereby the state can't spend more than in the previous year, will remain in place. However, the restriction on expenditures in individual months is to be scrapped. The finance minister will also be able to make additional adjustments to the budget during the year.
Parliament began discussing the proposal at its second reading on Tuesday afternoon and is due to vote on it immediately after the debate ends.
Under the current provisional rules, the state is unable to function normally, said Finance Minister Ladislav Kamenicky (Smer-SD) during the debate on the draft bill. "We're amending it so that there'll be a 'stick' for the government in the form of a cap on funding, but on the other hand we must retain a little flexibility so that, even in the event of, for example, a snap election, the state can continue to function normally. That's the whole point," he said.
Kamenicky acknowledged that the coalition currently has a fragile majority of 76 MPs. Furthermore, a decision from the Constitutional Court is expected on whether the cabinet is obliged to present a balanced budget. Citing one of the exceptions to the debt brake, the government has drawn up a budget for next year with a deficit of 4.94 percent of gross domestic product (GDP), which Parliament will begin debating on Wednesday (7 October). If the budget isn't approved, or if the Constitutional Court rules it invalid, there's a risk of a provisional budget coming into force as of January.
During Tuesday's debate opposition MPs criticised the proposal to relax the rules on provisional budgets.
MP Stefan Kišš (Progressive Slovakia/PS) pointed out that, under the provisional budget, Finance Minister Ladislav Kamenicky would become the sole arbiter of public finances. "For example, he could spend all the money allocated for the whole year within nine months. You're going to change the provision regarding one twelfth (of expenditures) every month. You need 76 votes (to approve the budget), and if any rebels refuse to support the budget, you'll tell them that the alternative is worse," said Kišš.
MP Marian Viskupič (SaS) said that the government can't be certain that the budget will be approved, which is why it's dealing with a provisional budget. "This shows that you don't know how to do it. None of us is talking about adopting a balanced budget. We all realise that this isn't possible next year, but your duty under the Constitutional Act on Budgetary Responsibility is to present a balanced budget here," he said, addressing the finance minister, pointing out that the budget should then be amended so that it will be clear what can't be afforded and that €7.5 billion will have to be borrowed.
According to MP Igor Dusenka ('Slovakia'-Za ludi caucus), the fact that Slovakia is facing the prospect of a provisional budget is a sign of the finance minister's incompetence. "Despite three rounds of consolidation, Slovakia is set to take on more than €7.5 billion in debt next year. Because of your measures, the economy is stagnating, and major employers are announcing mass redundancies. You've been promising growth-boosting measures for a year or half a year - where are they?" asked Dusenka.
MP Rastislav Kratky (KDH) reiterated the demand for the submission of a balanced budget and for compliance with the constitutional law on budgetary responsibility. "For three years we've been emphasising that you should reduce debt, boost growth, not hold it back, and then manage the economy, reflect your vision for Slovakia in the budget and create policies for the people. You've done the opposite: you've held back growth and increased debt," he remarked.
Source: TASR
