Start of the debate on Budget rebalancing

The Serbian Parliament initiated today the debate on the rebalancing of the current year Budget of the Republic of Serbia, which is to be increased by more than 57 billion dinars. Explaining the reasons of the Budget rebalancing, Serbian Finance Minister Bozidar Djelic said that the necessary modifications were caused by the adoption of the Constitutional Charter of Serbia and Montenegro – defining the new authorities of the State Union, its financing procedures, as well as functions that should pass from the federal to the level of member countries – according to the Beta News Agency.

Besides the expenditures, the Budget rebalancing provides for the redirection of the funds from the Federal to the Republic of Serbia budget – which includes funds collected from the sales and excise taxes, customs duty obligations, consular taxes, flight control and similar public functions, declared Mr. Djelic. He also added that Serbia would allocate 38.2 billion dinars for the financing of the State Union, which represents 93.3 percent of the total, while Montenegro would participate with 45 million euros, i.e. between five and six billion dinars. The major part of the mentioned funds is to be allocated for the purpose of the military and the diplomacy, while approximately one billion dinars will be allocated for other community purposes.

The planned budgetary income for the year 2003 amounts 271.8 billion dinars, while the public expenditures should amount 318.8 billion dinars – meaning that the budgetary deficit will remain within the planned limits of 46.9 billion dinars. However, Mr. Djelic emphasized that the structure of the budgetary deficit financing would be modified.

Minister Djelic also announced a more active international diplomatic and economic activity, aimed primarily at the encouragement of the donors, in order to provide some 230 million euros (approximately 14 billion dinars) donations and favorable credit arrangements. The budgetary deficit should also be covered from the income realized through the privatization process (12.4 billion dinars), various loans (12.7 billion dinars) and net internal public debt contracting (6.8 billion dinars).

The aggravated international situation, the war in Iraq and the instability caused by the assassination of the Prime Minister Zoran Djindjic, influenced the reduction of the economic growth from the initially planned five percent to 3.5-4.5 percent, while the planned inflation rate should fluctuate within the limits of 9 and 11 percent – instead of the expected 9 percent, said Mr. Djelic, adding that the inflation rate is, for the moment, within the planned yearly variations.

The Finance Minister said that this was a continuation Budget, and that the planned rebalancing would not affect the items relative to the current budgetary beneficiaries, since the changes were only aimed at the transfer of authority from the federal to the republican level of the. Mr. Djelic also confirmed that salaries and pensions would continue to be paid regularly.

Speaking of the budgetary expenditures, Mr. Djelic said that new resources are planned for the equipment, homes and the mobility of the Ministry of Internal Affairs (1.6 billion), for imprisonment facilities (0.4 billion), for subventions and privatization (0.5 billion), for investments in the domain of culture (0.3 billion) and for the employment market (0.2 billion). According to the Minister, approximately 100 million dinars will be allocated for the special program for the repatriation of „our brains“ from abroad.

President of the Government of the Republic of Serbia, Mr. Zoran Zivkovic, expressed his expectations that the rebalancing of the current year’s budget would be adopted by a majority of votes or even unanimously, as it reflects the changes within the State itself and provides for a better functioning of the Serbian and common country authorities.