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Finance Ministry: Estimated deficit accounting for 4.3 percent of the Gross Domestic Product
The revenues of the general consolidated budget decrease, on the balance, by almost 18.36 billion lei, as a result of the second budget revision for 2019, with the expenditures dropping by about 2.09 billion lei, with the estimated deficit accounting for 4.3 percent of the Gross Domestic Product (GDP).
According to the draft Ordinance regarding the budget revision on 2019, published on Tuesday by the Public Finance Ministry (MFP), the decrease of revenues is determined by the domestic economy (10.49 billion lei of the 18.36 billion lei) and by influences of revenues from the non-reimbursable foreign funds (7.87 billion lei).
"The expenditures of the general consolidated budget decrease, on balance, 2,090.6 million lei and the deficit of the general consolidated budget in cash terms increases with the amount of 16,266.3 million lei. The budget deficit estimated for 2019 represents 4.3 percent of the GDP," the substantiation report accompanying the draft bill mentions.
The general consolidated budget execution in the first ten months shows a deficit of 2.8 percent of the GDP (28.83 billion lei), taking into account that the revenues stand at 261.1 billion lei, accounting 25.3 percent of the GDP and the expenditures stand at 289.9 billion lei, accounting for 28.1 percent of the GDP, the draft initiators mentioned.
The second budget revision of this year's budget is based on an economic growth estimated at 4 percent, significantly dropping against the 5.5 percent increase recorded at the first revision.
Furthermore, the estimations for 2019 are aimed at a downward revision of increases both for the number of employees, to 2 percent against 3.4 percent in the version of the spring forecast and for the average gross earnings, to 13.5 percent against 14.7 percent in the previous version, according to the document.
The Education Ministry, the Interior Ministry and the Transport Ministry are among the institutions whose budget credits had been decreased.
The initial budget deficit target for 2019 stood at 2.76 percent of the GDP.
This year's state budget was built on "untrue" information and "overestimated" revenues, Minister of Public Finance Florin Citu said on Tuesday.
He specified that the budget revision will show "what and where has been stolen", and where figures have been overestimated. Citu explained that the budget revision is meant to "correct and repair all the nonsense the PSD has done in the past three years of governing," and said that this budget revision "puts an end to a miserable practice whereby the money that should have been directed to social expenditures was used for the local barons".
Citu pointed out that the budget revision makes available the necessary funds for investments, the payment of pensions, salaries and allowances, medical leaves, medicines.
"The costs are seen in a larger deficit, which stands at over 3 percent after 11 months and at 4.3 percent at the end of the year," said the Finance Minister.
În turn, President Klaus Iohannis stated on Tuesday that the budget revision is "mandatory," in the context in which, he said, among other things, "there just wasn't enough money left" for pensions.
"The data are clear, the figures are clear, the conclusions a little bit more complex and, unfortunately, we discovered that the situation is like this and the deficit will for sure exceed 4 per cent. And it's also clear that certain expenses cannot be avoided. Like in the case of the pensions, for we discovered there just wasn't enough money left to pay for the pensions and that we need to make a revision in this respect, and also in other fields, where payments were delayed. (...) Revision is mandatory," said Iohannis, at the Cotroceni Palace.
He said he had a "calm and detailed discussion" on Monday with Prime Minister Ludovic Orban and the Minister of Finance, Florin Citu.
"They showed me a few data, approaches and we especially discussed about the minimum salary, in relation to the budget revision," added the head of the state.