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Monday, December 11, 2023

Two deficits. The Deputy Minister of Finance comments

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We all report to the European Commission in the same way and have always done so – said Deputy Minister of Finance Artur Soboń in “Tak jest” on TVN24, when asked about the letter sent by the government to Brussels, in which the deficit of the public finance sector was estimated at PLN 192 billion. Civic Coalition MP Cezary Tomczyk announced that the new coalition government will start exercising power “with a thorough inquiry”, including in the Ministry of Finance.

Andrzej Morozowski’s guests were an MP from the Civic Coalition Cezary Tomczyk and Deputy Minister of Finance Artur Soboń (PiS). They discussed, among other things, the situation of public finances.

– I hear that today the foundation for the new coalition, and the only program that appears publicly, is to be the founding lie in the form of budget hole. Today you have strong denials from the market, from rating agencies, from banks, from experts, from professors. You really can’t build anything programmatic on this lie, and please remember that (…). You will not build a new coalition today on this lie, said Artur Soboń.

Cezary Tomczyk recalled that KO declared a hundred specific things before the elections “in order to implement them.” – We will definitely start with a thorough inquiry at the Ministry of Finance to see, among other things, how you and your colleagues worked in all these ministries – he added.

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– To be honest, I can’t wait for it, because many people today want the government that comes to be elected. I would like us to understand this clearly. The state has lost its mandate to govern, he said PO MP.

– So I will ask you again, why are you handing out prizes today, why are you launching new competitions today, if you have lost your mandate to govern? I was the government spokesman then, in 2015, when the president Andrzej Duda he appealed not to take any action, because here is a new, fresh social mandate – said Tomczyk, referring to the elections won by PiS eight years ago.

What deficit?

The deputy head of the Ministry of Finance was asked in “Tak jest” about two deficits: – one, the budget deficit, which the government talks about most often in the media, and the other, the public finance sector deficit, about which the current government recently informed Brussels.

The first one is to amount to a maximum of PLN 92 billion, the second one – according to a letter sent to the European Commission – PLN 192 billion (5.6% of GDP).

– If we are talking about the debt of the entire GG sector (general government – deficit of the public finance sector – editor’s note), that is, such debt, it covers everything, both local governments, the budget, and funds, and so on. All countries have different forms of consolidation of the central budget and local budgets, and there is no single method that would be identical in all European Union countries. That’s why the EU came up with European Commissionand rightly so, that in order to compare apples to apples, we all report to the European Commission in the same way and have always done so – said Deputy Minister Soboń.

When asked which debt was real, Deputy Minister Soboń replied that “the one that means that Poland has less than 50 percent (of GDP – editor’s note) of (public – editor’s note) debt.”

The state public debt (PDP) increased by over PLN 30 billion in the second quarter of 2023 and amounted to over PLN 1,241 billion at the end of the first half of the year. The PDP to GDP ratio at the end of the second quarter of 2023 was 38.0%.

In turn, the debt of the general government sector (EDP debt), which is one of the elements of the Maastricht fiscal criterion, amounted to PLN 1,581 billion at the end of the second quarter of 2023, which represented 48.4%. GDP.

Main photo source: Piotr Nowak/PAP



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