ZAGREB, May 7, 2020 – A revised budget should be ready for the government’s meeting on Thursday, Finance Minister Zdravko Marić said on Wednesday, adding that everyone would feel the cuts and that despite the difficult circumstances, budgetary expenditures would stay as planned.
Asked by the press ahead of an inner cabinet meeting how much the budget would be reduced, Marić said that despite additional expenses for the health system and outlays to keep jobs, budgetary expenditures would stay as originally planned.
He said savings would be made wherever possible so that the expenditure side of the budget that is financed from taxes and contributions stayed as originally planned.
Asked who the biggest “victim” of the revised budget was, Marić said “everyone, depending on their budgets.”
“The most important thing is that everyone contributes. In today’s circumstances, you can’t expect the Health Ministry’s budget to be reduced significantly when you have constant demands for outlays for equipment or masks, or the Labour and Pension Ministry’s budget for pensions and support to the economy,” said Marić.
The key message of the revised budget is that we are managing to keep expenditures as planned, he added.
This year’s budgetary revenues are planned in the amount of HRK 145 billion and expenditures in the amount of HRK 147 billion.
The decrease in revenues is evident due to the bailout measures for the economy and, even more so, the decline in economic activity, Marić said, adding that the revenues side of the budget would certainly “suffer.”
Asked if Croatia would borrow on the foreign market soon given the possibility of a caretaker government, he said the international market was “in our focus” but that it is necessary to prepare well for that and to “wait for the right moment.”
Commenting on the European Commission’s latest economic forecast, Marić said the steep decline in all of the EU would not be fully compensated for in 2021 and that it is necessary to work on making the decline as small and recovery as quick as possible.
The fiscal position and estimate of the public debt-to-GDP ratio are similar to the government’s projections, which means the government’s projections are credible, he added.
Asked if there was money to keep jobs after June, when a three-month period of government aid for that purpose ends, Marić said the money for May had been ensured through a bond issue and that aid for June and other months would be worked on.
As for tax payment deferrals, he said they were possible for a period of six months and that this measure might be reviewed, depending on the circumstances.
More budget news can be found in the Business section.