7th September 2023, Skopje – Higher wages by 10% for the overall public administration, as well as payment of vacation allowance (K15), higher pensions, increased funds for social assistance, funds for procurement of pharmaceuticals, agricultural subsidies, additional support for companies, as well as a new ninth set of anti-crisis measures projected under the Draft Decision on Reallocation of Funds among the Central Government Budget Users and the Funds, being adopted at the Government’s session, to be submitted to the Parliament, for adoption.
This was announced by Minister of Finance, Fatmir Besimi at today’s press conference, whereat he stressed that the funds destined for these purposes are provided via reallocation as per a Reallocation Decision, rather than under a Supplementary Budget, taking into account that by the end of the year, the same nominal amount of the revenue collection and the expenditure execution is expected, as per the projections in the 2023 Budget.
“We started reallocating these funds, with the emphasis put on the social aspect, i.e. the main reallocations are specifically destined for supporting the citizens and their living standard – increase in the public sector wages, the vacation allowance (K15), the pensions, the social transfers, the agricultural subsidies, the ninth set of anti-crisis measures. We aim for supporting the citizens, so as to ease the price pressures as much as possible. At the same time, we keep the Budget development component, coupled by higher capital investments than the budget deficit. In addition, additional funds are reallocated as support for both domestic and foreign companies”, Minister pointed out, thereby adding that the strategy covers economic recovery, primarily focusing on protection of the living standard of the citizens and growth acceleration further on.
Required adjustments to the Budget, as he said, have been made by reallocations from those showing underperformance to those items in need of additional funds. Thereby, he stressed that all planned capital projects are to be implemented, and that the capital expenditures remain at a level higher than the budget deficit, i.e. as per the golden rule of government spending – to make borrowing only for investments and development purposes.
Under the Draft Decision, additional Denar 4.25 billion has been provided for increase in the wages of public sector employees by 10% and payment of vacation allowance in the amount of Denar 10,000, Denar 3.5 billion for increase of pensions by approximately 6% for 336 thousand pensioners, starting as of September 2023, Denar 600 million as payment of social rights for 36,000 beneficiaries of guaranteed minimum income, Denar 800 million for agricultural subsidies, mostly pertaining to milk, cattle raising and advance financing of farmers for plant breeding and cattle raising. Moreover, Denar 110 million has been provided for coping with the African plague, Denar 100 million for the purchase of the drug Trikafta” for 55 patients, Denar 20 million for purchase of digital sensors for monitoring diabetes, Denar 200 million for regular servicing of maternity leave, as well as Denar 166 million for translation, printing and purchase of textbooks for primary and secondary education. Denar 290 million has been provided for payment of student meals for 29,000 students, as well as payment of scholarships for 6,900 students and 9,600 pupils, Denar 650 million for payment of “My VAT” for the third quarter due to the increased refund limit, whereby as per the Draft Decision, additional allocations of the state aid were made, intended for companies, amounting to Denar 1.081 billion, as follows: Denar 581 million for domestic companies, Denar 200 million for foreign companies, and Denar 300 million for companies and arranging the infrastructure in TIDZ.
Besimi stressed that as per the Draft Decision, funds are provided for implementing measures under the ninth set of anti-crisis measures, with the projected funds in the amount of Denar 4.55 billion under Program P1.
Additional funds have been provided, while the budget deficit remained the same in nominal terms, thus speaking in favor of the commitment to gradual fiscal consolidation. In addition, under this reallocation, the golden rule of government spending is observed, capital expenditures remain higher than the budget deficit, whereby all planned capital projects are to be implemented.
According to this Decision, total reallocations amount to Denar 18.2 billion, provided via savings when the smooth process implementation leaves room therefor, as well as through increased contribution collection, and by making cuts at the items showing underperformance.
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