25th July 2024, Skopje – Draft 2024 Supplementary Budget is on the agenda of the parliamentarian Financing and Budget Commission, as of today. The proposed changes were presented before the members of Parliament by the Minister of Finance, Gordana Dimitrieska-Kochoska, pointing out that this Supplementary Budget provides funds for all liabilities that are to be serviced from the Budget according to the law.
“The Draft Supplementary Budget was the first challenge I jointly addressed with my team, and I believe that the solution offered is the most optimal one, taking into account the resources available, the small room for manoeuvre and, by all means, the macroeconomic situation. It is a solution aimed at creating a solid foundation as a starting point of preparing the 2025 Budget, reflecting the policies which would lead the country forward”, Minister of Finance said.
Under the Supplementary Budget, funds are provided for all items regulated under the law, having not been planned, i.e. funds for employees, pensioners, students, companies, as well as settlement of liabilities on the basis of interest, loans and so forth.
“As a responsible Government, observing the scripture of the Law, we will not stray away from it as we are providing funds for servicing all liabilities with the Supplementary Budget. The responsible approach we applied has resulted in changes both on the revenue and expenditure side of the Budget and the budget deficit. Our attempts resulted in detecting maximum savings from items recording poor execution and funds lying idle, as well as non-essential expenditures, and we have managed, led by the fiscal consolidation efforts, to identify savings of around Denar 20 billion and utilize them where needed”, Dimitrieska-Kochoska said.
As per the Minister, the 2024 Supplementary Budget is based on realistic macroeconomic assumptions, whereas the fiscal policy is directed towards the return of the macroeconomic stability and support of economic activity through gradual fiscal consolidation, improvement of public finance management and sustainability of capital expenditures.
Under the Supplementary Budget, total revenues in the amount of Denar 318.2 billion are projected, increasing by 2.6%, i.e. around Denar 8 billion higher compared to the initial 2024 Budget projections. Total expenditures are projected in the amount of Denar 362.8 billion, being higher by 5.6%, i.e. by Denar 19.2 billion, compared to the initial 2024 Budget projections. The deficit, on the basis of the revised revenue and expenditure projections, is projected in the amount of Denar 44.7 billion, increasing from the initially projected 3.4% to 4.9% of GDP.
The Minister stated that the deficit increase, coupled with the exception from the fiscal rule, is a result, above all, of the necessity to provide funds indispensable for smooth functioning of institutions and servicing of liabilities. It incorporates additional Denar 4.1 billion for wage payment, Denar 5.1 billion for payment of pensions, out of which Denar 2.5 billion are intended for the announced linear increase of Denar 2,500, allowing for a better quality of life for our seniors. Additional Denar 400 million is provided for transitional costs for the second pension pillar, Denar 0.8 billion for payment of guaranteed minimum income, Denar 1.7 billion for health care protection, additional Denar 1 billion for TIDZ zones, Denar 1.7 billion for agricultural subsidies, Denar 437 million for student’s meals, Denar 207 million for scholarships, Denar 300 million for block grants, additional funds for financing radiobroadcasting services, election activities, as well as court rulings, and penalties towards European Commission due to irregularities detected by OLAF. Under the Supplementary Budget, additional Denar 0.8 billion is provided for payment of interest to local and international creditors, Denar 5.1 billion for called up guarantees on the basis of loans extended to PE and state owned JSC and Denar 6 billion for municipal projects.
As per the Supplementary Budget, Denar 45 billion is projected for capital investments aimed at economic development, revising thereby the capital projects with slower pace of implementation, in particular the ones the financing of which is through special accounts.
The projected level of budget expenditures allows for regular and smooth functioning of institutions, settling the liabilities towards international creditors, as well as improving the living standard of citizens and companies, the Minister underscored.
Under the Supplementary Budget, economic growth forecast has been revised downward to 2.1% this year as opposed to the previously projected 3.4%, conditioned by the less favourable external environment, poor execution in 2023 and economic trends in 2024, with the inflation rate being forecasted at 3.5% in 2024, a significant slowdown of the price trends compared to 2023.
The Commission’s general debate on the Draft Supplementary Budget may last up until 10 days. 58 amendments have been put forward for the submitted Draft Supplementary Budget.
