Skopje, 16th July 2015 (MIA) – Government of the Republic of Macedonia adopted 2015 Supplementary Budget at today’s session.
As Deputy Prime Minister and Minister of Finance, Zoran Stavreski said at today’s press conference held at the Government, the Supplementary Budget has not underwent a big change but it rather includes reallocations in the areas where that is required by Government’s policies, measures and projects, without changing the basic macroeconomic parameters.
– Supplementary Budget does not foresee budget cuts for any of the budget beneficiaries, but it rather includes reallocations in the spheres, where due to certain policies, measures and activities, additional funds should be allocated or where the project realization is better than the initial plan. Principal presumptions for drafting the Supplementary Budget also include revision of the projections of GDP, as well as revenue and the expenditure trends, Stavreski said, stressing that 2015 GDP growth is revised to 3.5%, while budget deficit is set at 3.6% of GDP.
GDP revision, as Stavreski explained, is based upon two facts, the first one being the solid economic growth of 3.2% in the first three months of the year. However, the second quarter was marked by a prolonged political crisis and uncertainty in the country due to the debt crisis in Greece. This, as he added, was a risk factor calling for revising the overall projections. Therefore, the Government and the Ministry of Finance considered that the GDP growth projection should be revised from 4% to 3.5%.
He pointed out that the Budget was in good condition in the first half of the year, adding that the budget revenues exceeded the expectations and the projections.
– Budget revenues were higher by around 14% compared to the same period in 2014, meaning that the collection of budget revenues was by around 6 percentage points higher than the initial projections in the first six months this year, Stavreski said.
He stressed that the good results as regards the revenues is a combination of divergent trends of certain tax revenues.
– VAT revenues experienced somewhat lower collection than the projections, being fully compensated with the higher collection of revenues on the basis of both profit tax and excises. All in all, the revenue collection was higher than the projections, thus creating for the Budget to be in sound financial condition, upon which the Supplementary Budget is based, Stavreski said.
He underlined that the Supplementary Budget foresees for the revenues to be higher by Denar 3.562 billion.
– This is a result of the higher tax revenues, which in line with the projections, will be higher by Denar 6.051 billion than the initial forecasts. Non-tax and capital revenues will be lower by Denar 1.73 billion than the initially projected ones, Stavreski said.
As for self-revenue accounts, as he stressed, collection is higher by Denar 769 million, while social contributions are reduced by Denar 1.528 billion.
– Total expenditures will be higher by Denar 5.204 billion, whereby capital expenditures will be higher by Denar 1.115 billion. What is most important is that additional Denar 370 million has been provided for intensifying the construction of the gas pipeline network from Klecovce to Stip. In addition, Denar 60 million has been provided for renewing “Goce Delcev” student dormitory, Denar 245 million has been provided for co-financing IPA Projects, the budget intended for building the school sports halls and renovating the schools was expanded by Denar 220 million, additional Denar 370 million as funds on the basis of EIB loan were provided for the purpose of constructing water supply and sewerage , Stavreski said.
He added that transfers to the Ministry of Labour and Social Policy were increased by Denar 428 million, transfers to the Health Insurance Fund were increased by Denar 111 million, while transfers to the Pension and Disability Insurance Fund were increased by Denar 115 million.
– Expenditures were also revised. As for salaries, there will be total increase of Denar 631 million, including the salary increase for the Police, being previously realized, Stavreski said, announcing that the envisaged increase of pensions by 5% will also be realized, starting with the October pension.