The 2010 public finances deficit is expected to be at 5.5 percent of gross domestic product on revenues of €23.97 billion and expenditure of €27.68 billion, according to the general government budget plan published by the Finance Ministry on September 29. The percentage amount of the deficit for the whole public sector is the same as for the central government (state) budget: that figure features revenues of €12.53 billion and expenditures of €16.28 billion.
Compared to 2009, expenditures of three ministries are set to be higher in 2010 compared to this year. Excluding money coming from the EU and through co-financing, the Health Ministry is set to spend €90.6 million more in 2010 than this year. Expenditures of the Labour, Social Affairs and the Family Ministry are planned to be higher by €67.69 million, while the Education Ministry will be authorised to spend an extra €9.37 next year.
Analysis and forecast: increasing risk
There is a risk concerning the fact that 2010 is an election year in Slovakia, and the economy does not seem to be over the bottom, so fiscal policy may become less rigorous than it seems at first glance. The Finance Ministry counts by a €2.2 billion more expenditure than this year’s data, while detailed revenue calculation is not public, so it is still unclear how the government plans to find the cover for the spending. Tax hike seems inevitable, though Finance Minister Ján Pociatek stressed that in the year of elections it is unimaginable. Since the economy’s acceleration is expected to be quite modest, higher than planned deficit is a real threat.