The Slovak Parliament has definitively rewritten this year's state budget and increased its deficit to a record high.
On Tuesday, members of the Slovak parliament approved the draft amendment to the State Budget Law, which assumes this year's budget deficit of almost €12 billion. Compared to the original budget from the workshop of the previous government, the deficit is increasing by as much as €9.2 billion, while total expenditures should grow by €7.8 billion. According to the Finance Ministry, the approved material takes into account the negative impact on public finances of the COVID-19 pandemic, but also of the originally uncovered expenditures.
The amendment still needs to be signed by the president. According to the Council for Budgetary Responsibility (RRZ), the amendment to the law on the state budget for this year is necessary and expected but justification of the extent of budgetary changes is difficult to assess from the Cabinet's proposal.
At the same time, the Council points out that the space created should not be used to increase expenditure unrelated to the current exceptional situation. In addition to the items listed in the explanatory memorandum, which relate mainly to the consequences of the pandemic, the Council states that the government expects to increase spending in other areas as well, in particular to cover other budgetary risks of around 3 billion euros. However, this amount is not explained in the material and represents space for the government to make arbitrary decisions beyond parliamentary control, the Council points out.
