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April 16, 2021
BUSINESS

PM Ponta: 3rd budget revision positive, budget deficit at 0.2 pct of GDP in 11 months

Prime Minister Victor Ponta said in the beginning of the Government’s sitting on Wednesday that the third budget revision this year will be positive, as a result of a better absorption of the EU funds and higher collections to the budget.

“We have a positive revision meaning that, after eleven months, the budget deficit is 0.2 percent of GDP, not 2.2 percent as we negotiated by the Fiscal Treaty and by the deals with the IMF and the European Commission, because we have extra European funds as compared to 2013 (in the end there will be 3.4 billion euros), 12 billion lei in additional collections to the budget as compared to 2013 and the economic growth that you know very well, it was confirmed by the National Institute for Statistics today”, Ponta stressed.

Ponta explained that through the revision the enforceable claims that were gained in court by state employees, but also arrears to private companies.

“This revision will help us pay for the final court orders won by professors, public servants, and magistrates. Furthermore, it will be for the first time when we will not have arrears to private companies in Romania. (…) We will continue to earmark, as promised, extra money for defence and healthcare”, said the Prime Minister.

Ponta also said that the Government’s decision to operate a third budget revision has the approval of the European Commission and of the International Monetary Fund.

“I will never understand the point of view of those in the Fiscal Council that say that we shouldn’t pay what we have to pay by court decision’, said the Prime Minister.

In the opinion of the Fiscal Council, as published on the institution’s website, the Government’s decision to operate a third budget revision ‘is proof of an obvious administrative incapacity to program and execute the budget, especially regarding investment spending”.

PNL’s Predoiu: Third budgetary revision, non-transparent and illegal

The third budgetary revision promoted by the Ponta Cabinet is non-transparent and illegal, because it violates the laws on fiscal accountability and public finances that allow only two revisions a year, First Deputy Chairman of the National Liberal Party (PNL) Catalin Predou said Wednesday.

He underscored that the latest revision ‘confirms some mistakes of economic governance, a lack of economic development vision, while keeping in place some policies that will affect the economy in 2015 as well.’

Predoiu argued that a budgetary surplus of RON 1.9 billion touted by Prime Minister Victor Ponta is instead a 1.9-billion investment deficit. He also indicated that public investment in the first ten months of 2014 is RON 2.7 billion smaller than in 2013, with collected revenue of 6.5 percent, instead of 8.5 percent, as mentioned in the ongoing budget.

‘Value Added-Tax (VTA) collection is a disaster that places Romania last in Europe. Income tax collection is another disaster and the absorption of European funds is an additional disaster,’ said Predoiu.

 

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