Wages burden budget

Recent official data from the Ministry of Finances show that the concrete budget expenses in the first seven months of the year were 36 million USD more than the plan.

The cause was the increased administration bill and the operative expenses.

Together with the expenses for pensions, these indicators keep growing year after year, although the finances are in crisis. Compared with the first seven months of the year, the wage bill increased with 7 million USD, the operative system bill with 20 million USD and the pension bill with more than 30 million USD. The government financed these with the revenues collected with other financial sources. But due to the crisis, the revenues have increased with 7 million USD, the operative expenses with 20 million USD, the expenses for pensions 30 million USD. The government financed them with the revenues collected from taxes and other financial resources, but due to the crisis, the revenues have increased with an inconsiderable pace.

In the first seven months of the year the government collected  108 million USD less than the plan and the lack of money combined with the increased bill for pensions and operative expenses has obliged the government to decrease the public investments. The government investments were 70 million USD lower than one year ago for the first seven months, or 17.6% less.

Investments penalized

After increasing expenses for the electoral year of 2009, the government started making budget cuts fearing a debt increase. The public expenses decreased from the historical maximum of 33% of the national GDP in 2009 and 28.6% for the last year. But what is the government cutting? Despite the efforts to shrink the administration, the figures show that the effect was inconsiderable. The cuts for wages and contributions have decreased only with 0.29%. The same goes for the operative expenses, including the funds for the road maintenance, the diets, travels and training of the administration employees.

80% of the cuts have been created by the shrinking of the public investments, which directly affect the economic growth. According to the official data, the government investments in economy decreased from 8.33% of the GDP in 2009 to 5.4% for the last year.

The data show that the numbers are falling year after year and chances are that if the privatizations will not be realized on time in 2012, the investments might fall under the 5% of the GDP, which is considered by the government as the indispensable limit for supporting the economic growth. The economic growth decreased with 3% last year, a negative figure for the first trimester.

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