The Ministry of Finance confirmed that the budget deficit in December amounted to 146 million, instead of the planned ten million, that the state coffers lacked a total of 172 million, and that in that month they spent all 159 million euros that the new government borrowed in December.
Current expenses cost 112 million instead of the planned 163 million. Expenditures for materials amounted to 3,8 million instead of 11,5, costs for services increased from 5,8 to 16,5 million, current maintenance cost 3,2 million instead of 8,4, for subsidies it was 4,8 instead of the planned spent 21,7 million, for other expenses 10,6 instead of 4,2 million...
When asked by "Vijesti" why there was a multiple increase in current expenditures for materials, services, subsidies and other expenditures, from the Cabinet of the Minister of Finance News of Vuković mostly cited extraordinary reasons and events for the growth of some of these items.
"In December, uniforms for members of the Army of Montenegro were procured under the item 'expenditure for material', which was realized by redirecting funds within the budget of the Ministry of Defense, precisely in favor of the item 'expenditure for material', which is why there is a deviation in the execution of this budget item in relation to on the plan. 'Expenditures for services' were realized in a larger amount than planned, mainly due to the withdrawal of funds from loans, donations and IPA funds. The mentioned funds are executed to the extent of their realization and are not planned, in accordance with the provisions of the annual budget law, but the consumption is recorded, and there are deviations in the execution compared to the plan. Namely, with the Ministry of Agriculture, Forestry and Water Management, funds from the loan, intended for the implementation of the MIDAS project, as well as with the then Administration of Revenue and Customs, intended for the financing of the project 'Reform of tax administration', for the implementation of the project 'E-fiscalization', were realized, while at the Ministry of Tourism, Ecology of Sustainable Development and Development of the North, realized funds from donations. Funds for subsidies, in December, were paid in a larger amount compared to the plan, mainly at the Employment Office, on the basis of subsidies to legal entities that employ persons with disabilities, bearing in mind that they were not realized for November, because with the adoption of the Law on amendments to the law on the budget for 2023 created the legal prerequisites for its implementation in December. Also, the increase in the execution of subsidies is due to the withdrawal of IPA funds from the Ministry of Agriculture, Forestry and Water Management", the Ministry of Finance stated the reasons why current expenditures in December were a total of 51 million more than planned.
Expenditures for transfers to institutions, individuals, non-governmental and public sectors were planned for December at 30,7 million euros, and in the end they amounted to 71 million, while 79 million were paid for capital expenditures instead of the planned 20,7 million.
"Expenditure under the position 'transfers to institutions, individuals, non-governmental and public sector' was realized in a larger amount than planned, primarily at the Health Insurance Fund, within the sub-programme 'Health Care', for the supply of medicines and medical devices, within of the public health system. For detailed information on the realization of the capital budget, the Ministry of Finance refers to the Directorate for Capital Projects and the Directorate for Transport, as institutions that take care of the execution of the Capital Budget. In addition, we point out that in December, around 11,4 million euros of funds were withdrawn from credit lines, intended for the realization of capital projects, as well as two million euros of donor funds, which is why there is an additional deviation of execution compared to the plan. It is important to note that, in the total amount, the annual budget spending plan was not exceeded", the Ministry stated.
The debt was 159 million, and it could have been up to 500 million
The Ministry states that in December spending is a debt of 159 million euros. "Vijesti" asked why this happened, when it was announced that the money would be used as a reserve for 2024.
"Amendments to the budget for 2023 provided for the possibility of borrowing around 500 million euros, for budget financing purposes. Also, at that time, the expectation was expressed that it would not be necessary to provide funds and debts in the planned amount, but in a significantly lower amount, in order to provide funds for regular financing of the state's obligations, as well as providing a fiscal reserve, in the amount of roughly 50-100 million. euros, which would be used during 2024. Therefore, borrowing was realized in a significantly lower amount than planned, which ensured regular servicing of the state's obligations, as well as an increase in deposits at the end of the year, which were carried over to 2024. Please note that borrowing is carried out in accordance with the projected flows of revenue and expenditure collection, on the basis of which the needs of budget financing and realization of fiscal reserves are planned. According to the above, and taking into account the higher revenue collection than planned, which was also the case in December, at the end of the year borrowing was carried out in the total amount of EUR 159 million", the Ministry stated.
Contracts were concluded with eight domestic commercial banks, for total debt in the amount of 109 million euros with an average weighted interest rate of 6,55 percent fixed per year, with an average maturity of 54 months, while the largest number of contracts were concluded with a maturity of five year.
"Additionally, in December, the state borrowed through the issue of government bills, in the amount of 50 million euros, of which 20 million for three months, 20 million for six months and 10 million for nine months, while the weighted average the interest rate on the total amount of issued bills is 3,7 percent", the Ministry stated.
No clear answer as to whether new responsibilities will follow
Given that a deficit of 146 million euros was realized in December, instead of the planned 2024 million, "Vijesti" also asked whether there were preliminary data on the income and expenditure of the budget for January XNUMX, whether it had a surplus or a new one. deficit, as well as whether the functioning of the state coffers will soon require new debt.
"Data on the implementation of the budget for January will, in accordance with established practice, be published as part of the regular monthly reports on the implementation of the budget, during February 2024," said the Ministry.
In the tables on revenues and expenditures of the state budget from December, it was also stated that in that month, debts of 28,7 million euros from foreign sources were spent.
"There was no additional borrowing on the foreign market during December, but funds were withdrawn from already secured foreign sources, as well as funds from arrangements with international financial institutions, which are used to finance infrastructure projects. Since the calculation of business results is still in progress, more detailed information will be published in a timely manner after consolidation", the Ministry stated.