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Budget expenditure up by almost PLN 21 billion. Deputy Minister Sebastian Skuza translates

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State budget expenditures may increase by about PLN 20.8 billion, said Deputy Finance Minister Sebastian Skuza. He explained that the budget amendment is a response to the agreement with “Solidarity”, the result of support for local governments with the amount of about PLN 14.1 billion, and aid for agriculture.

On Friday the Council of Ministers adopted the draft act amending the budget act for 2023 together with the draft resolution of the Council of Ministers on the draft act amending the budget act for 2023 – documents submitted by the minister of finance. It was indicated that “according to estimates, the state budget revenues will amount to PLN 601.4 billion in 2023, and expenditures will amount to PLN 693.4 billion”.

According to the current budget act for 2023, budget revenues were planned at PLN 604.5 billion and expenditures at PLN 672.5 billion, and the budget deficit at no more than PLN 68 billion.

“The macroeconomic and geopolitical environment is characterized by high volatility – we have a war abroad and fluctuations in the prices of energy resources. All this makes forecasting basic macroeconomic figures a significant challenge. MF (Ministry of Finance – ed.) economic growth was close to the EC forecasts and was within the so-called market consensus,” said Deputy Finance Minister Sebastian Skuza in a commentary for PAP.

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The effect of the agreement with “Solidarity”

He explained that the budget amendment is a response to the agreement with “Solidarity” and the result of consultations with the local government regarding their support with the amount of approx. PLN 14.1 billion.

“At the same time, the amendment provides a financial buffer to secure socio-economic issues related to the ongoing war in Ukraine (support for the agricultural sector). The above-mentioned actions will increase expenses by about PLN 20.8 billion,” noted Skuza. He added that the financing of additional expenses through the budget amendment is consistent with the announcements of the government and the Ministry of Finance that the role of extra-budgetary funds within the entire public finance system will decrease .

The shield affects budget revenues

“The projected total state budget revenues in 2023 will amount to PLN 601.4 billion – PLN 3.2 billion less than provided for in the original act. The most important factor that influenced the revenue forecast is the maintenance of the anti-inflation shield in terms of reduced VAT rates on food – pointed Skuza.

He pointed out that the amendment will have a slight impact on the statistics public debt. “It is worth recalling that at the end of last year, public debt, according to the EU definition, amounted to 49.1 percent and was thus lower than the level achieved in 2015 and much lower than the average for the entire EU” – stressed Skuza.

Main photo source: Shutterstock

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