Czech lawmakers approve 2014 budget, deficit seen within EU rules

By bne IntelliNews December 19, 2013

The lower house of the Czech parliament approved on December 19 in third and final reading next year’s state budget that envisages a higher deficit than in 2013 but below the EU’s limit of 3% of economic output, iDNES.cz reported.

The bill, which must be signed by President Milos Zeman to become law, was supported by 109 of the present deputies in the 200-seat chamber. The budget was backed by lawmakers from the leftist Social Democrats (CSSD), anti-corruption movement ANO and Christian Democrats. The three parties signed earlier this week a coalition agreement to form the country’s next government after the October early elections. The MPs managed to pass the 2014 budget for a record short time of less than two weeks thus avoiding the possibility of entering 2014 with a provisional budget.

The budget assumes a 1.3% economic growth in 2014 as the country is expected to recover from a 1.1% contraction forecast for this year.

The deficit limit is set at CZK 112bn (EUR 4.1bn), or by CZK 12bn more than the planned for this year. The overall public sector deficit, including the central government budget, regional and local budgets, public funds and public health insurance, will stay just below 3% of GDP, similar to this year’s target of 2.9%.

Budget revenues are forecast at CZK 1,099bn, up by CZK 6bn from the 2013 adjusted budget plan. Expenditure is set to rise by CZK 18bn to CZK 1,211bn.

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