"Every year, we borrowed an average of 500 million euros to finance the Budget, and the capital budget practically did not exist until the construction of the highway began. Public debt has grown in all years in the last 10 years to a level of over 100 percent of GDP in 2020. For the first time this year, that trend will reverse". (Milojko Spajić, September 28, 2021 during the promotion of the "Europe Now" program)
The slogan "Europe now!" appeared in Slovenia at the end of the XNUMXs and, even within the existing SFRY, it expressed a clear aspiration towards membership in the then European Economic Community, the forerunner of today's European Union. The "Europe Now" program at the time enabled the northernmost Yugoslav republic to undergo institutional and economic transformation, and thanks to it, Slovenians escaped the Balkan mire of poverty and a poisoned mentality.
The basis of this transition project, which completely rejected the anachronisms of the planned economy and the inertness of the self-governing administration, was, among other things, the clearly structured sustainability of public finances! The then-started transition from a socialist economy to a capitalist free market meant reducing budget spending, implementing new technologies, introducing clear analysis procedures for all the most important investment and financial decisions, as well as efforts by political elites not to resort to excessive optimism! Of course, any allusion to the obvious deviations of "Montenegrin plagiarism" in relation to this Slovenian (and regionally most successful) transition project is more than intentional. It is necessary at this moment, because all the consequences of budgeting for the coming year, which are proclaimed as the "Europe Now 2" project, can cause not only serious existential breaks for our community, but also permanently distance it from EU membership.
These days, the Parliament of Montenegro will consider the draft law on the budget for 2024 by the 44th Government of Montenegro, whose organizational structure is not fully known, whose competences are not (yet) legally defined, and which does not have precise records of the number of employees in the public sector. Particularly dramatic for our fiscal future are the announcements of changes to several systemic laws, without which the income side of the budget cannot be ensured. These legal changes also refer to the weakening of the financial potential of coastal and central local governments.
But in addition to the above, it is evident that the public debt during the next year, if there was support for it among our deputies, could exceed the figure of 2,1 billion euros! During the presentation of the budget proposal for the next year, not only the potential sources of financing the missing funds, but also the principles, the available conditions on the financial market, as well as the monitoring mechanisms, ie the transparency of the announced debt processes, were not mentioned. These days, it would be useful to hear an explanation from the Ministry of Finance on compliance with the Macroeconomic and Fiscal Policy Guidelines for the period from now until 2026.
It is also necessary to remind that all governments up to now, which will very likely be the case with this one, prevented a clear insight into the ways of paying off public debts and financial reports on realized projects for which, allegedly, we borrowed on purpose! Therefore, it is necessary to recalculate the outstanding debts of the previous three-decade government, which are coming due at the end of 2025 and which may also exceed the figure of 2 billion euros! After such planned and accrued public debts, it is not only an inevitable violation of the Maastricht criteria, but we are also expecting debts at very high interest rates. He also warns of the possibility that funds for development projects could remain in the tender fog if they are not provided in a timely manner or if the Budget Law is not passed by December 31. It would be fatal if, like 2021, we start the next year with temporary financing! This circumstance also has a symbolic level for the current prime minister.
Namely, since "the high foreign debt limits the possibilities of direct borrowing of the state", and potential international sources of funds for financing infrastructure and investment projects have not been announced to the public, perhaps this time Prime Minister Spajić will resort to a non-transparent stock exchange arrangement, as he once did when was a minister?
At the end of this analysis, an open question remains - what is the content of the pre-election program "Europe Now 2"? If we leave out the announced increase in salaries, which is otherwise not in the budget proposal, then we must look critically at whether the proposed budget scenario guarantees our citizens a more rational use of public funds, the realization of public (and planned) interests and heralds a better quality of public services?
A kind of irony is also the problematization of the mandatory salary increase for educators. Not even what was agreed is safe, let alone what was promised before the election!
The determination, as well as the implementation of the budget, is based on the principle of responsibility - everyone has their own responsibilities, and based on them, the responsibilities for the resulting harmful consequences are clearly determined. Probably no political decision indicates responsibility more clearly than the one by which all public revenues and all public expenditures are predicted in detail - it not only reveals one's intentions, but also recognizes the unscrupulous!
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