The Government confirms the draft revised budget for 2020
At today's correspondence meeting, the Government adopted the draft revised national budget for 2020. It also adopted the Act amending the Implementation of the Republic of Slovenia's Budget for 2020 and 2021 Act, which will enable the implementation of this year’s budget after the revised budget comes into effect.
The Government confirms draft revised state budget for this year
At today's correspondence meeting, the Government set out the draft revised national budget for 2020. Revenue is projected to reach EUR 9.2 billion, with expenditure reaching EUR 13.4 billion. The projected budget deficit for this year therefore stands at EUR 4.2 billion or 9.3% of GDP. The drop in revenue and increase in expenditure in view of the adopted budget are a result of the economic shutdown during the COVID-19 epidemic and the measures adopted to safeguard both the population and the economy. The Government looks out for its citizens and businesses during COVID-19 crisis
The draft revised budget for this year was drawn up in uncertain circumstances and following the swift and sudden shutdown of the economy after an epidemic was declared, which caused a great economic shock. According to the latest forecast by the Institute of Macroeconomic Analysis and Development of the Republic of Slovenia, the GDP will realistically fall by 7.6% this year. During the epidemic there was a significant drop in budget revenue, while there was also an increase in expenditure due to the measures adopted by the Government to mitigate the effects of the crisis and preserve economic activities.
The revised budget revenue is projected to reach EUR 9.2 billion. This is 14.7% lower, i.e. EUR 1.6 billion, in comparison to the adopted budget for 2020. This is a reflection of lower consumption, a higher unemployment rate and poorer business results.
Expenditure is projected to reach EUR 13.4 billion and is lower by 29.3%, i.e. EUR 1.6 billion, in comparison to the adopted budget for 2020. Of these EUR 13.4 billion, just under EUR 3.1 billion will be spent directly and indirectly on mitigating the effects of the COVID-19 epidemic. This is the amount the state allocated through various measures as part of the so-called anti-corona packages for the protection of its citizens and economy and to mitigate the negative effects of the epidemic.
It should be noted that, in the assessment of compliance with fiscal rules for 2020 on the EU level, exceptional circumstances are present that permit the temporary derogation from the medium-term balance of public finances.
The Government also drew up the text of the draft Act amending the Implementation of the Republic of Slovenia's Budget for 2020 and 2021 Act, which will enable the implementation of this year’s budget after the revised budget comes into effect.
The amending act will, among other things, enable the assumption and payment of liabilities which are financed from earmarked EU funds and associated budget items of the national contribution, through the projected commitment appropriations in the adopted budget, to accelerate the absorption of EU funds.
The procedures for allocating funds to finance investments will also be simplified and accelerated. Furthermore, up to EUR 50 million will be provided from the state budget to finance epidemic-related material costs which were incurred by providers who perform health services within the network of the public healthcare service.