Fiscal Council members today met the Minister of Health Mr Aleš Šabeder and his team at the Ministry’s initiative. The discussion focused on challenges of long-term fiscal sustainability in light of rising public health-related expenditure.
Based on publicly available data and its own estimates, the Fiscal Council assesses that some provisions of the proposed Act Amending the Pension and Disability Insurance Act, which is currently the subject of public debate, could have significant long-term impact on the sustainability of public finances. It therefore calls on the Government to transparently present […]
The general government was in balance in the first quarter of 2019 whereas in the same period last year it recorded a surplus of 0.4% of GDP. This change reflects, in particular a further acceleration of expenditure growth, which is mostly of a structural nature and linked to higher growth in expenditure on compensation of […]
In accordance with the provisions of the Fiscal Rule Act the Fiscal Council made an assessment of the executed general government budgets’ compliance with the fiscal rules in 2018. The Fiscal Council assesses that the 2018 fiscal policy was neutral since the structural balance did not change, although it should have been restrictive in view of the economy’s cyclical position. The medium-term fiscal objective under the EU rules was achieved in 2018, but only if the allowed deviation is taken into account. The domestic rule referring to general government expenditure was not complied with because the expenditure exceeded the benchmark of the adopted medium-term framework. The decrease in the share of general government debt in GDP was appropriate in 2018.
Pursuant to the Fiscal Rule Act, the Fiscal Council is required to submit a report on its operations in the past year to the National Assembly of the Republic of Slovenia by the end of May each year. The first part of the report describes the structure and various levels of operations of the Fiscal Council in the last year: the Fiscal Council drew up all budgetary document assessments envisaged by the legislation, and at the same time responded to economic and political events that marked the past year. The second part of the report presents selected topics that the Fiscal Council examined in more detail and that constituted the basis for the opinions and assessments provided.
The Fiscal Council, after reviewing the draft Ordinance on the framework for the preparation of the general government budgets and the draft Stability Programme 2019, finds that in the 2019-2022 period the expected fiscal developments are outside the bounds of the fiscal rules in 2019. From 2020 on the projections set out in the submitted documents are set near the limit values of the fiscal rules but are exposed to significant risks. These risks arise in particular as a result of various economic policy measures which have been announced and have not yet been taken into account in the submitted documents, but are also related to the macroeconomic environment. The persistence of a favourable economic developments allows for the adoption of the necessary structural measures that will ensure long-term fiscal sustainability, particularly given the increasing fiscal pressures associated with the ageing of the population.