Kamenicky: We Will Draw Up Next Year's Budget in Line with Fiscal Rules

Bratislava, 28 January (TASR) - Next year's state budget will be prepared in line with European fiscal rules, Finance Minister Ladislav Kamenicky (Smer-SD) told a press conference on Wednesday, adding that Slovakia's economy and public finances are significantly affected by negative trends in the global economy. "We are acting responsibly. There are certain fiscal criteria set by the European Commission that we must follow," he said, adding that "we cannot simply decide to run whatever deficits we like, because financial markets would react to that. We want to prepare next year's budget in line with fiscal rules". He declined to provide more details on the parameters of the budget, pointing to global developments, such as the Greenland situation or looming additional tariffs in global trade, as well as the stagnating German economy, on which Slovakia depends. "Based on the spring forecast, after receiving figures on tax collection, macroeconomic indicators and expected economic growth, the budget-drafting process can begin," stated Kamenicky. He announced that the Finance Ministry will also seek to push through an amendment to the Fiscal Responsibility Act, the so-called debt brake, while possible changes aimed at helping local governments have already been revealed on Tuesday (27 January) by the Slovak Towns and Villages Association (ZMOS). "We know that we are supposed to submit a balanced budget for next year," said the minister, adding that ZMOS would run into huge problems and wouldn't be able to function. "They wouldn't be able to take out loans and there would also be other difficulties. That's why we are opening this topic. We've submitted this to ZMOS and others for expert consultations, and we want to amend the Fiscal Responsibility Act accordingly," said Kamenicky. He expects that those concerned will also discuss support with the opposition, because any amendment to the constitutional act requires at least 90 votes in Parliament, which the governing coalition is not able to deliver. According to him, changes in the Fiscal Responsibility Act were also mentioned by the International Monetary Fund in its latest report. As the debt brake provisions require the government to undergo a confidence vote in Parliament due to the current high level of debt, Kamenicky said that the law is still being analysed. "We will comment on everything related to confidence. The Government Office is also conducting analyses, and based on that we will, of course, respond as allowed by the Constitution," said the finance minister. He also rejected criticism surrounding the transaction tax in that it has brought significantly less revenue to the budget than expected, saying that it's a new tax and the revenue is difficult to estimate in advance. jrg