BRATISLAVA, August 2, (WEBNOVINY) — The development in Slovakia’s public finances is basically positive, and therefore the Finance Ministry is currently not preparing any additional measures to squeeze the general government deficit to the projected 4.9 percent of gross domestic product (GDP), announced Finance Minister Ivan Miklos at Tuesday’s news conference. “We do not see a reason to draft additional measures,” Miklos stated, assuring that the ministry is ready to take action if measures to achieve the consolidation plan are needed. He not specify their potential structure.
In spite of a rather positive development of public finances, the finance department sees certain risks, too. The biggest risk is the development of the external environment. The consolidation of state-run railway companies, settling the debt of state-run hospitals or shortfall of tax revenue from the sale of emission quotas could also negatively affect the budget. Some items in the state budget, such as expected dividends, could be even higher than originally projected. Thus, the pros and cons should balance each other out, the ministry opines.
The state budget of the Slovak Republic posted a deficit of EUR 1.675 billion as of late July. According to data from the Ministry of Finance, budget revenues grew 8.9 percent to EUR 6.569 billion, while expenditures fell 2.4 percent to EUR 8.244 billion. Thanks to growing revenues and declining spending, the state budget deficit has decreased by over thirty percent in annualized terms. According to the Finance Ministry, the operation of the state costs the citizens considerably less than a year ago. While during the first seven months of 2010 basic expenditures for the operation of state institutions reached EUR 5.56 billion, it was EUR 5.09 billion in the same period of this year.
According to the state budget law adopted by parliament, the state budget should have EUR 13.148 billion in revenues and EUR 16.958 billion expenses in 2011. The budget deficit is expected to be EUR 3.81 billion. The deficit of the general government as a whole, considering all public institutions, not only the state, should be 4.9 percent of GDP. The government plans to squeeze the deficit bellow 3 percent of GDP in 2013.
SITA