The new coalition rejected the law on public finance

From Parliament, we learn that the new center-right coalition in the meeting of the Committee on finance and monetary policy rejected by the law on public finance. If the Slovenian Government writes rules that will provide the appropriate discipline in the spending of public funds.

A proposal of a novel law on public finance, the Government of Borut Pahor proposal set measures to ensure the sustainability of public finances, after the assessment of the parent Committee for finance and monetary policy REPORT is not suitable for further consideration. Such a decision, the Committee will propose for adoption at an extraordinary meeting Thursday DZ.

To the novel proposal –  the law shall evaluate as unfit for further consideration, the members of the Committee suggested Maheshwari (SDS). As he explained, the content did not elaborate and could bring more confusion than value added, in addition, the legislative legal services DZ substantive comments on more than half of the articles. ‘It’s very superficial ready, ” agreed Bojan Starman (DLGV) and called for the immediate start of drafting a new proposal. On the other hand, M Frangež (SD) and Alenka Bratušek (PS) highlighted the President’s parliamentary parties agreed that this law is necessary and should be adopted without delay.

The Government, which carries out day-to-day business, she wanted to provide the legal framework for amendment on the basis of which the new Government immediately started preparing measures against a Secretary of State at the Treasury Department Vraničar P. According to the proposal in the law on public finance imprinted measures to ensure the sustainability of public finances, inter alia, on the restriction of the borrowing and the issue of State guarantees.

The Problem of fiscal sustainability is not a problem only in Slovenia, but the wider European area, said Vraničarjeva. He asked, how will the refusal to accept the proposed the law to respond to the international financial markets, which sometimes are unpredictable. ” It’s hard to say that the us will be tarnished credit rating and raise markups on bonds, but it’s possible, ‘she said.

The representatives of the trade unions of the public sector are sitting next to the predictions of lower public spending and are afraid of losing that cuts in public spending even higher than in the public of 800 million euros. In their opinion, should more than the contraction of expenditure budget work to increase revenue, the action does not exclude the social partners.

More needs to be done on the revenue side of the budget, it’s a little bit wicked, ” said Dan Miščević from 90 and Confederation of trade unions pointed out that as the public finances will not be stabilized overnight, by not going through the shoulder civil servants.

The European countries with the golden economic rules

While the debate on the introduction of the golden rule, which would set a rule in the Constitution limiting the budget deficit and public debt, some European countries are already in their fiscal rules the highest legal acts of the State.

Fiscal rules to limit the budget deficit and public debt are part of the laws of the European Union as well as the law of the Member States. The first is the fiscal or the golden rule in the Constitution put Poland in 1997, and two years later she was followed by Switzerland, which is not part of the EU-Yes, in the last review of the Constitutional debt limitation periods being compared, wrote the authors of the analysis, Igor Zobavnik, Marjana and John B.

A few years ago are limiting borrowing in the Constitution also stated that Austria in 2007 and in 2009, Germany’s fiscal rules in the last constitutional level by a new Constitution earlier this year adopted a Hungary.

Poland first with fiscal rules

Poland in 1997 in a special section devoted to the field of public finance and limit national debt. ‘ Is not allowed, nor even the provision of borrowing guarantees and financial sureties, which could lead to a national public debt exceeding three-fifths of the value of annual gross domestic product, ‘ it says in paragraph 216. Article of the Constitution.

In 1998 were in the law on public finance met the constitutional obligation and given that the method of calculation laid down by law, by the law were also prescribed preventive and corrective actions, if the national debt exceeded 50%, 55% or 60% of the value of the annual GDP. With a view to limiting national debt at the level of the Constitution is also important first paragraph 220. Article of the Constitution, which limits the powers of the Parliament with regard to the increase in national debt, as it provides an increase in expense or decrease in the revenue of the budget in relation to the Government’s proposal cannot be adopted in Parliament, if it is provided for a deficit bigger than that which was provided for in the draft budget. ‘

In 74. Article Act on public finance, the minister of finance is responsible for the control of public finances and respect for the constitutional principle that public debt should not exceed 60 percent of the annual GDP.

In the Constitution Switzerland is specifically defined by the management of the budget and in 126. article says that ‘ the State cares for the permanent balance of expenditure and receipts. The maximum amount of the total expenditure in the preliminary draft budget shall be determined in relation to the expected benefits, taking into account the general economic situation. Exceptional needs may lead to an increase in the maximum approved amount of the total expenditure set out in the preceding paragraph shall be decided by the Federal Assembly in accordance with 159. Article of the Federal Constitution. ‘

Austria is a comprehensive reform of the fiscal rules adopted in 2007 and 2009, the Parliament adopted the reform by consensus. The Constitution in 13. the article provides that the land and the municipality of Association to provide for a sustainable balanced budget. The Federal Government, the Parliament, at the latest each year, within the time limit laid down by federal law, to submit the draft law on the Federal Finance frame or a draft federal law by changing.

Law on federal financial frame for the next three financial years contain the following the ceiling of financial resources, namely at the level of the assigned categories, as well as the basics for human resources plans. Excluded are assets to repay financial debt as well as monetary commitments for the temporary strengthening of budgetary funds and the funds used for the exchange of capital in foreign exchange agreements.

Hereinafter referred to as the Constitution provides an exception (the sixth paragraph of article 51)-categories of the ceilings laid down by the law of the Federal Finance frame may not be exceeded even such overdrafts should not be allowed, except in the case of the needs of the defence and, if the cover assets guaranteed by saving or the additional income in the event of imminent danger.

The German debt brake in Germany to curb high levels of borrowing in 2009 adopted the amendment to the Constitution, with which they accepted the new rules of borrowing-the so-called brake ratio for the relationship and of the country.
With these rules they want and to coordinate the long-term sustainability of the budgets of the Union and the countries, taking into account the intergenerational distribution of loads and the requirements of the European stability and Growth Pact, the base should be structurally balanced budget, which means that the budget deficit cannot be compensated for with new debts.

From the prohibition on borrowing are excluded loans that do not exceed 0.35 percent of nominal GDP, which applies exclusively to the relationship. It is also authorized by the high reasons, which should be taken into account, symmetrically, which means that during the fall you can hire more of the loans to stabilize economic development, during a period of growth and borrowing again reduced. In the case of borrowing is at liberty to natural disasters and other emergencies emergency events, which are not under the control of the Member States relating to the limitation of public debt.

Hungary’s sovereign debt limitation introduced by the new Constitution, which came into force at the beginning of this year. Debt is limited to 50 per cent. The most prominent is 36. the article, which provides that the Parliament may not accept a budget bill that would allow it to exceed the debt of half of the GDP.

‘ Until the national debt exceeds half of the GDP, the Parliament can only accept a State budget bill that includes debt reduction in the proportion of the GDP, ‘he writes in the fifth paragraph of article, while the exception only possible throughout the duration of the specific legal arrangements, to the extent that is necessary to mitigate the effects of the event and in the event of a significant and long-term national economic recession, to the extent that is necessary for the establishment of the balance of the national economy.




The EU and the IMF praised Ireland: fiscal consolidation is progressing successfully

Ireland will continue to be carried out successfully pursued a plan of fiscal consolidation, are in the latest quarterly assessment of the progress of the write down the EU experts and the International Monetary Fund (IMF). However, the pointed to the numerous challenges that continue to stand in the way of the country to recovery.

Among the latter, experts underline the continued efforts for political change, for the success of the Irish economy is going to be very open in their opinion, necessarily improve the situation in the external environment. The Irish economy is expected to grow this year by about 0.5 percent rate.

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Or experts praised Ireland, which carried out significant reforms with a view to improving the situation of the financial sector. Also improved the confidence of the markets in its policy, which has contributed to the stabilisation of the yield to maturity on its bonds.

Ireland is also on the way to meet the financial objectives of consolidation for this year. Last year, the general government deficit without the support of the banks reached 9.4 percent of gross domestic product (GDP) this year would not exceed 8.6 per cent of GDP.

Heavily Indebted Ireland was forced in November 2010 to apply for the 85-billion loan States with the euro and the International Monetary Fund (IMF). Positive report is the first step, which will provide a fresh tranche of loans to Ireland, namely 1.4 billion euros from the IMF and 2.3 billion euros to the EU.

Be careful about the measures for the growth

European Council President Herman Van Rompuy today in Brussels pointed out that to promote economic growth in the euro area, there are no simple solutions. A similar opinion was Italian Prime Minister Mario Monti, who estimated that spending would further generate the illusion of recovery only stimulative in Europe.

Van Rompuy stressed that currently, there is no room for stimulating measures. Calls to such handling is reportedly French news agency AFP as schizophrenic. However, he mentioned the possibility that the leaders of the countries are ahead of the planned summit convened at the end of June, an informal dinner.

While the euro zone after two years of austerity measures to slip back into recession is the Van Rompuy, in an address at the European Economic Summit reminded that economic reforms will be taken to deal with the debt crisis might require some time before giving results in the form of positive impact on growth and jobs.

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Fiscal consolidation is not just monetary savings. It also means investing in the future, ‘stressed Van Rompuy. As one of the possible ways to promote growth, however, is mentioning the increase in the capital of the European Investment Bank, which directs loans to companies and projects.

Like the opinion of the Italian Prime Minister was Monti, who pointed out that monetary stimulation gave only illusory results. ‘ The EU must ensure that growth with structural reforms, ‘he stressed, while pointing out the European legislation or agreement recognized and barriers to cross-border business.

According to the German News Agency dpa was Monti also determined that the so-called fiscal pact must not wait for the end of the ‘ poor ‘, the same as the Stability Pact from 2003. That year, the Paris and Berlin successfully lobirala in other European countries, that they look at you in your fingers at the breaking of the rules on the government deficit. Later, the EU reform, which unite the softened the implementation of the stability pact.

Collected at the European Economic Summit is to address another Belgian premier Elio di Rupa. This is a repeat call to the President of the European Central Bank (ECB) Maria Draghi to the European Pact for growth. ‘We are all aware of how vital it is budgetary discipline. A key question now is how to find the way to growth again, ‘he said. ” It seems to me Unacceptable that young people don’t believe in a better future, ‘he stressed.

Leaders of the G8

The leaders of the Member States of the G8 today continue their meeting at Camp David. The host, u.s. President Barack Obama, has said that before starting talks must go measures to encourage economic growth hand-in-hand with measures for the rehabilitation of public finances, reported by foreign news agencies.

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‘ today we’re going to devote a lot of time to economic themes. It is clear that the euro zone will be one of the themes, ‘ he told reporters Obama. ” We all agree that the growth and stability and fiscal consolidation are part of the same package, ” he added.

The situation in the euro area will be at the forefront of today’s talks the leaders of the UNITED STATES, Germany, France, Italy, Great Britain, Japan, Canada and Russia. the views of the leaders of the Member States of the G8.

While German Chancellor Angela Merkel emphasises the need to continue, in particular, fiscal discipline, some others in the first place, the new French President Francois Hollande and Obama, point to the urgency of the stimulus for growth.


Slovenia and Euro Bonds

Brussels -pending the introduction of a common Euro bond is still far away, can become a reality only when in Europe in addition to monetary Union, as well as fiscal assessed the Prime Minister Janez Janša.
Euro bonds will one of the unofficial leaders of the EU Member States dinner.

‘ to euro bonds is still far away. The introduction of the euro bonds, by those who think that they are the solution to all their problems, requires a change of the Treaty. We all know what it means and what is the procedure, ‘the Slovenian Prime Minister said upon arrival at the Summit of European people’s Party, which traditionally takes place before the EU Summit.

‘Maybe they are more realistic, but project bonds, of course, is not the same,’ he added. Project bonds, which would encourage investment in the Union in the European transport, energy and communications networks, are part of the package for growth, which is expected to adopted at the June Summit.

Prime Minister expected by open debate on this issue. It is recalled that the debate on all such meetings in the past year, and announced that they will be in the Union has long talked about. ” These bonds will be a reality when we have in Europe, in addition to monetary Union, ” as well as the fiscal Council has decided.

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A discussion on the issue, which divides the Union, wants to open this evening a new French President Francois Hollande, although Germany insists that it is too early for this project, since the Union must first take care of a more cohesive and fiscal policy to ensure budgetary discipline.
from Paris, came news that France will ratify the fiscal pact until a sufficient breakthrough concerning the measures for growth. Hollande is expected to ratify the Treaty in return for fiscal requested a signpost to euro bonds and the deal on a tax on financial transactions.

New French Prime Minister, Jean-Marc Ayrault was introduced plans for policy formulation in the field of labour and welfare. As announced, it will be before national holidays, 14. in July produced a ‘ social Summit ‘.

As soon as possible with the aim of better preparedness for the Conference will be May 29, met with representatives of the five largest trade unions and representatives of the employers ‘ organizations. The topics of the Conference will be employment, training, wages, minimum wage, working conditions and retirement. The new Prime Minister announced certain changes in the unpopular pension reform ex-President Nicolas Sarkozy.



Euro bonds and Greece on the menu dinner for leaders of the EU

In Brussels, the leaders of the EU Member States ‘ informal meeting is held at which the conversation about economic growth. The conflict, in particular with regard to joint Euro bonds.

Upon arriving at an informal dinner of European leaders was French President Francois Hollande calling for immediate action to boost economic growth.
‘we have to act Immediately to  growth momentum … otherwise markets will continue to doubt,’ Hollande said, referring to falling European stock markets and the euro.

Hollande tried to calm Franco-German dispute predictions of the joint Euro bonds, which are considered one of the funds in resolving the debt crisis, while in Berlin, insisting that it is still too early for them, and to be the first to provide for a more cohesive fiscal policy and budgetary discipline.

‘ we didn’t come here to fight, but to tell each other what we think, ‘ he said and explained that the euro bonds is part of the debate. ” We’ll probably have a decision at the end of June, but at this moment it is important that we tell each other what we think, ‘he added.

German Chancellor Angela Merkel stressed that euro bonds are not the solution, which would contribute to the startup growth. It is also pointed out that the introduction would be contrary to European law.

Slovenian Prime Minister said:  ‘ To euro bonds is still far away. The introduction of the euro bonds, by those who think that they are the solution to all their problems, requires a change of the Treaty. We all know what it means and what is the procedure, ‘ it sure Janez Janša.

Project bonds, with which the EU should encourage investment in European transport, energy and communications networks, are part of the package for growth, which is expected to adopted at the June Summit.

Janša are expected discussion open on this issue. It is recalled that the debate on all such meetings in the past year, and announced that the EU has long talked about.

Coming from Paris, France to the fiscal pact will not be ratified until a sufficient breakthrough concerning the measures for growth. In Exchange for ratification of the Treaty, Hollande is expected to require a fiscal marker to euro bonds and the deal on a tax on financial transactions.

On the agenda of the meeting, although Greece is also a decision is not expected, as it is waiting for the new elections, which will be 17. June and shall be subject to a referendum on membership of the euro area countries. In the EU-the voice of them all have expressed a desire to stay in Greece in the euro area, but in the background, according to European diplomats, preparing a plan B in case the exit from the area of the common currency.

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