Kosovo’s ruling coalition divided over 2017 budget

By bne IntelliNews November 24, 2016

The Democratic Party of Kosovo (PDK) is reportedly still considering whether to back the 2017 budget drawn up by its coalition partner the Democratic League of Kosovo (LDK). 

The 2017 budget envisages a large increase in infrastructure investment, but also halving the spending on war veteran benefits, both of which have drawn criticism from the PDK. 

Expenditures on benefits for war veterans have far exceeded initial expectations. Assuming no changes, these benefits would total €93mn in 2017, whereas next year’s budget sets aside just €50mn.

At the same time, spending on roads is planned to exceed €700mn, up from €500mn in 2016. The Balkan country is presently building a highway from Pristina to the border with Macedonia. There are plans for another highway, expected to cost €260mn. The second project is considered important for maintaining the support for LDK in eastern Kosovo, BIRN commented.

PDK lawmaker Shukri Buja told news website Indeksonline that the party has yet to decide whether to vote in favour of the current version of the 2017 budget, the UNMIK media reporting service said on November 23.

Buja is a member of the parliament’s budget and finance committee, which had a meeting on November 23. According to him, the only chance for PDK support is to change the current bill. He claimed that “numerous flaws” in the current version will harm Kosovo. “Loans, debts, the failure to resolve the issue of the war veterans, a budget that is not focused on development but is rather a ‘budget of asphalt’, we cannot support it,” Buja commented.

His statement contradicted claims by LDK representatives that both parties had agreed to pass the draft budget. While the PDK is the senior partner in the coalition, Kosovo’s Prime Minister Isa Mustafa and Finance Minister Avdullah Hoti both come from LDK. 

Previously, Deputy Finance Minister Isni Kilaj from the PDK also criticised the 2017 budget, saying that it is not planned well, does not ensure jobs and development, and will instead be spent on roads and asphalt.

Meanwhile, the International Monetary Fund (IMF) also called for containing spending on war-related schemes. Following a visit earlier this month, a Fund mission said that spending on war-related schemes could exceed €100mn per year, “which is significantly more than Kosovo can afford without foregoing much needed spending on other priority areas.”

Ruud Vermeulen, head of the IMF office in Kosovo, was quoted by BIRN as saying, “Budget spending on war veterans should not exceed €50mn and the total for all war survival categories should not exceed €75mn … Concrete reform involves either decreasing the number of benefactors, or decreasing the level of benefits, or a combination of both.”

PDK parliamentary group head Zenun Pajaziti said the question of veteran payments should be resolved “internally”. The final approval of the budget must take place no later than December 31.

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