Latest news

Former FinMin: In 2016 we had 1.5 billion lei savings in budget; Romania's budget is monitored by EC

Former Public Finance Minister Anca Dragu maintains that in 2016 there were registered approximately 1.5 billion lei savings in the budget, taking into account that, according to the current estimates, the year ends with a 2.59 percent budget deficit, under the initial 2.8 percent of the GDP initial target.

"Not only that we haven't exceeded the 2.8 percent of the GDP budget deficit target, but we have even had savings, taking into account that we have a deficit estimate at the year-end of 2.59 percent of the GDP. In cash, it means savings worth approximately 1.5 billion lei," Anca Dragu told Agerpress on Monday.

She thus denies the statements made by Social Democratic Party (PSD) leader Liviu Dragnea who has recently said that the budget revenues for 2016 are "10 or 14 billion lei" lower than those estimated "on paper" by the former leadership of the Finance Ministry.

Moreover, the former minister noted that the statements don't come from the Finance M in is t r y .

"I haven't seen a position of the Finance Minister on this topic. They should be, in this period, very busy drawing up the budget for 2017," Dragu underscored.

Moreover, she explained that the budget functioning mechanism, namely that it is an annual instrument, and if in 2016 there had been additional expenditures these should have been reflected in the deficit of the same year, not transferred to the budget for next year.

At the same time, the former minister mentioned that Romania's budget is monitored by the European Commission, which would have sent warnings in case there was the risk of exceeding the deficit target.

"Romania's budget, same as of any EU member, is monitored by the European Commission. All estimates of the EC, ever since mid-year, have shown possible savings in the budget, taking into account the budget execution, in the sense that the deficit will be under 2.8 percent of the GDP in 2016. Therefore, uncovered expenses have not been indicated," Anca Dragu added.

Referring to the estimations of the new Finance Minister concerning the economic growth over the next four years, of a 5.5 percent average per year, Anca Dragu said that the budget draft she sent to the new Government provides a 4.3 percent economic growth in 2017.

"In the budget draft, we went on a 4.3 percent growth for 2017. If, indeed, the pension and salary increases in the governance programme are implemented, these could have an additional contribution of 0.2 - 0.3 percentage points, because the effects from consumption come up. However, the European Commission has a 3.9 percent of the GDP economic growth estimation for 2017. Same does the International Monetary Fund," she added.

PSD Chairman Liviu Dragnea has recently stated that he would consult the Social Democrats to decide a possible setup of an investigation parliamentary committee, taking into account that the budget for 2017 has a "hole" of 10 or 14 billion lei.

He said that he is considering establishing an investigation parliamentary committee to verify the decisions of the Finance Ministry at the last budget revision.

Financial - Latest news