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Government to revise projected budget deficit
Belgrade,
28 May 2010
Serbian Prime Minister Mirko Cvetkovic stated today that talks with the IMF mission have been successfully concluded, adding that the government will have to revise the projected budget deficit from 4% to 4.8% and to freeze pensions and salaries in the public sector until the end of the year.
At a press conference following the government session, Cvetkovic declared that agreement has been reached with the IMF to freeze pensions and salaries in the public sector until the year’s end. He also said that around RSD 6.5 billion will be set aside from the budget as one-off aid to employees with the lowest incomes in the public sector, to pensioners and the poorest municipalities in Serbia.
The Prime Minister emphasised that Serbia is not under an obligation to lay off surplus employees in public administration and local self-government within a month, but only to take additional steps in this period in order to bring this matter to a close.
He announced that in this respect, the government will send a memo to budget users informing them about the deadline for dismissing surplus staff, adding that it will assess which options are most realistic.
Cvetkovic warned that budget users who fail to comply will be punished, noting that the budget deficit will be covered by dividends from public companies founded by the state.
The Prime Minister emphasised that Serbia is not under an obligation to lay off surplus employees in public administration and local self-government within a month, but only to take additional steps in this period in order to bring this matter to a close.
He announced that in this respect, the government will send a memo to budget users informing them about the deadline for dismissing surplus staff, adding that it will assess which options are most realistic.
Cvetkovic warned that budget users who fail to comply will be punished, noting that the budget deficit will be covered by dividends from public companies founded by the state.
The Prime Minister also noted that the dinar will remain stable until the end of the year because the National Bank of Serbia is ready to defend the stability of the domestic currency, bearing in mind the high foreign currency reserves at its disposal.
As for increasing the number of treasury bills, he underlined that the government is contemplating this option, noting that the maturity period of these bills will be three to five years, bearing in mind that the Ministry of Finance, ie the Treasury Administration, is currently issuing these bills with a maturity of three, six, twelve and eighteen months.
He announced that the income from the sale of treasury bills in the market will not be used to reduce the budget deficit, but to further endorse the dinar.
Cvetkovic remarked that at today’s session the government removed the secrecy label from documents related to the suit which Serbia lost to the Israeli company ImageSat on the matter of the satellite lease.
The government has set up a committee to negotiate with this company and the committee’s task will be to minimize the damage incurred.
The Prime Minister added that there are indications that the other party is willing to negotiate and specified that negotiations will start as soon as the Serbian government forms a negotiating team.
At the proposal of the Serbian Ministry of the Interior, the government passed a decision that citizens of the EU, Switzerland, Norway and Iceland will be allowed to enter Serbia with their IDs only.
The government adopted a decision today according to which the Directorate for the management of confiscated property obtained through criminal acts will pay RSD 3 million to the flood-stricken municipality of Trgoviste. The Prime Minister highlighted that this shows how the funds obtained through confiscated property will be spent.
As for increasing the number of treasury bills, he underlined that the government is contemplating this option, noting that the maturity period of these bills will be three to five years, bearing in mind that the Ministry of Finance, ie the Treasury Administration, is currently issuing these bills with a maturity of three, six, twelve and eighteen months.
He announced that the income from the sale of treasury bills in the market will not be used to reduce the budget deficit, but to further endorse the dinar.
Cvetkovic remarked that at today’s session the government removed the secrecy label from documents related to the suit which Serbia lost to the Israeli company ImageSat on the matter of the satellite lease.
The government has set up a committee to negotiate with this company and the committee’s task will be to minimize the damage incurred.
The Prime Minister added that there are indications that the other party is willing to negotiate and specified that negotiations will start as soon as the Serbian government forms a negotiating team.
At the proposal of the Serbian Ministry of the Interior, the government passed a decision that citizens of the EU, Switzerland, Norway and Iceland will be allowed to enter Serbia with their IDs only.
The government adopted a decision today according to which the Directorate for the management of confiscated property obtained through criminal acts will pay RSD 3 million to the flood-stricken municipality of Trgoviste. The Prime Minister highlighted that this shows how the funds obtained through confiscated property will be spent.
Deputy Prime Minister Jovan Krkobabic confirmed that an agreement on freezing pensions has been reached with the International Monetary Fund. Regular adjustments with salaries in the public sector will not start before April 2011.
He disclosed that pensioners who are registered with the state-owned pension and insurance fund will be receiving 65% of the average salary in the public sector, while pensioners from the private sector will receive 64% and farmers 30%.
After the first adjustment in April 2011, the next adjustment will be in October the same year and then in April 2012, Krkobabic explained.
He disclosed that pensioners who are registered with the state-owned pension and insurance fund will be receiving 65% of the average salary in the public sector, while pensioners from the private sector will receive 64% and farmers 30%.
After the first adjustment in April 2011, the next adjustment will be in October the same year and then in April 2012, Krkobabic explained.
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