BRATISLAVA, December 1, (WEBNOVINY) — Slovak Parliament voted on Thursday to send the constitutional bill on budgetary responsibility also know as the ‘debt brake’ to the second reading. Of 147 MPs present in the 150-member parliament, 146 supported the draft while one lawmaker refrained from voting. To pass the bill will require a constitutional majority of three-fifths of all parliamentary deputies, i.e., ninety votes.
MPs agreed on Wednesday to accept the Cabinet draft bill for fast-track legislative procedure despite disapproval of the opposition SMER-SD. According to chairman of its deputy club Pavol Paska, the first bill requiring a constitutional majority discussed in parliament after a long time deserves a standard procedure. In the debate prior to the vote, also another SMER-SD deputy and ex-state secretary of the Finance Ministry Peter Kazimir negatively reacted the Cabinet’s decision to ask for an expedited legislative procedure for the bill. He said that that more time should be devoted to the constitutional bill on budgetary responsibility “I perceive it to be a too serious thing to have it ready in one afternoon,” he stated. The reason is also the fact that various proposals have been emerging in Brussels that might bring bigger integration in the fiscal field and also tougher fiscal rules within the European Union, which might intervene in the construction of the bill. “We need the very latest updated impact analysis of compliance of the latest suggestions of the European Commission with the concept of our bill, he said.
Despite the approved expedited procedure the bill still has backing of parliamentary parties, including deputy Ivan Matovic who leads the Ordinary People group. SDKU-DS deputy Ondrej Matej is glad that also other political parties are responsible enough to support the bill. However, some MPs find the bill too soft. They criticized mainly the debt brake limit, the maximum of which was set at 60 percent of GDP while it should be gradually reduced to 50 percent of GDP.
Six parliamentary parties submitted the bill to parliament three weeks ago, following a month-long public discussion. Broad political support for the bill indicates that Slovakia pursues a responsible management of public finances and is determined to avoid sinking deeper into debt. The bill introduces an automatic sanction mechanism that will be launched already at the debt limit of 50 percent of GDP. The Finance Minister would then be obliged to clarify the increase to MPs and suggest measures to reverse the growth. At 53 percent, the Cabinet would be obliged to pass a package of measures to trim the debt and freeze its wages. At 55 percent, 3-percent binding of expenditures would be launched automatically and next year’s budgetary expenditures would be frozen, except for co-financing of the EU funds. At 57 percent of GDP, the Cabinet would have to table a balanced budget. Should the debt climb to 60 percent of GDP, the Cabinet would have to face a confidence vote in Parliament. The volume of public debt reported by the EU’s Statistical Office Eurostat on an annual basis shall be the key data.
When discussing the bill in the Cabinet, the Finance Ministry said the reason for the fast-track legislative procedure is the fact that the current economic situation calls for instant effective solutions to alleviate the impacts of the financial crisis in the eurozone countries and stabilize the monetary and economic system of the single currency area. The aim is to avert extensive financial losses in the Slovak economy.
SITA