The third budget revision was approved by derogation from the law which bans more than two annual budget revisions or a budget revision later than November 30.
Romanian Prime Minister Victor Ponta on Wednesday stated he would never understand the opinion of the Fiscal Council regarding this year’s third budget revision, adding that the International Monetary Fund (IMF) and the European Commission (EC) agree with this measure.
The Fiscal Council said Wednesday that the third budget revision for 2014 is breaking the law and shows the government’s incapacity to organize and implement the budget, mainly in terms of investments, while the payment of certain salary rights to state employees will not reduce pressure on the 2015 budget.
The Fiscal Council representatives said the government’s argument regarding the budget surplus after the first ten months is wrong as the budget surplus was not the result of higher-than-estimated revenue, but the result of failing to deal with investment expenditure.
Thus, at the end of October, investment expenditure was down by RON2.3 billion compared with the same period a year earlier, although the 2014 budget stipulated that expenses with investments should have been up by RON5.8 billion compared with 2013.
According to the third budget revision this year, government will give extra funds to the Ministries of Justice, Agriculture, Transports, Education, and Defense, mainly for the advance payment of certain salary rights to state employees, while the budgets of the Presidency, Parliament, Ministries of Foreign Affairs and Economy will be cut, with a deficit of 2.2%.
The government said the budget revision draft was the result of the data between January 1- October 31, 2014, showing a surplus of 0.29% of GDP compared with a deficit of 1.18% of GDP in the same period a year earlier.
According to the budget revision draft, the economic results so far might trigger a 2.6% economic growth for the entire year, from 2.2% estimated when the state budget law was drawn up.