The directive of the Novgorod can thwart the plans of the Ministry of Finance. PiS leader Jaroslaw Kaczynski wants to increase public expenditure in relation to GDP. Clear on this PiS leader spoke at Saturday’s chat on Facebook. Asked about the possible increase for teachers replied:
It’s a question of the reform of finance and GDP growth. Earnings are actually modest improvement requires increase the share of public spending in GDP . Many economists might indignant, but the current level of 41.5 percent. It is too low .
But spending in relation to GDP was at the end of 2015. Poland is in the top ten EU countries that have the lowest share of expenditure in relation to GDP.
Declaration of President Kaczynski is a dispute trouble for the Ministry of Finance and the government. Only at the Ministry of Finance prepared – and the government has adopted – an update of the convergence program. This document, which is what the government sends to the European Commission, the presentation of which is to show that Poland keeps a tight rein on their public finances. In the latest edition of the APK government maintains that after two years of growth in public spending share of GDP (this year to 41.6 per cent. Of GDP, next to 41.9 per cent. Of GDP), mainly caused by running the Family 500 plus, in subsequent years the ratio of public expenditure to gross domestic product will decline. “to 2019. Will limit of the ratio of spending to GDP by nearly 1.4 percentage points. The level of expenditure over the forecast horizon does not exceed the amounts implied by stabilizing expenditure rule “ – declares the government.
The decrease in the share of expenditure in GDP does not mean cuts – MF assumes an increase in expenditure, so that slower than the rate of economic growth . For example, according to APK, expenditure on social protection calculated as a percentage of GDP in 2019. Will be the same as in 2015 and will amount to 16.1 per cent., But in real terms compared with 2014. Will increase by one quarter. For Marta Petka-Zagajewski, economist Raiffeisen Polbank , it’s understandable action. – Fiscal policy should be a stabilizing economic growth. I should not increase spending excessively during the boom period so that this can be done during the downturn in the economy – says an economist. Would point out that the decline in the share of expenditure in GDP is coherent with the objective of convergence program: the gradual decline in the public finance deficit since 2018. – Supporting this assumption on two legs – income growth and slowdown in spending growth – is more reliable – says Marta Petka-Zagajewska .
the convergence Programme is based on the current state of the law, and therefore omits some announcement of the election campaign, the consequence of which would be increase in budget expenditures , and which are eg. in the planning phase. An example of a declared increase in spending on health. According to CSO data, in 2014. Public expenditure on health amounted to approx. 75 billion zł, or 4.6 percent. GDP. Health Minister declared a gradual access to approx. 6 percent. GDP. Meanwhile, the APK is written that in 2019. Health expenditure will amount to 4.5 percent. GDP. Another tabled in the declaration of an increase in military spending. In one of the pre-election convention program PiS came the announcement to invest at least 2.3 percent. Of GDP, and the Law and Justice deputy campaign spoke up about 3 percent of GDP. Today, annual spending on the army is 2 per cent., And as the APK, has no plans to increase them. What’s more spending in relation to GDP in some areas have to be reduced, so they have to be eg. In education, where it is expected to fall from 5.3 percent of GDP in 2014 to 4.9 percent of GDP in 2019 and in section security and public order where to be reduced from 2.2 percent of GDP to 2.1 percent of GDP in 2019.
the desire to implement election promises and new ideas Consumption ministries will cause the pressure to increase spending in a meaningful way, it will be She grew. Change of course the increase in expenditure in relation to GDP can have serious fiscal consequences. The finance ministry plans to transient increase in the deficit next year to 2.9 percent of GDP, and then its decline. This increase is due, among others, that the 500 plus program will run throughout the year, not three quarters, as in this year. There are even higher expenses due to the increase in the tax-free amount and lowering the retirement age – the cost of both of these activities the Ministry of Finance estimated total of 12 billion zł. At the same time the Ministry of Finance estimates the increase in revenues from taxes on seals from 6.5 to 16.5 billion zł, next year and in 2019. These forks are expected to reach 21 billion to 33 billion zł zł.
– Gather the assumed sum due to seal system will be extremely difficult, and achieving this way 3 percent. GDP, or 60 billion zł is not feasible. The seal itself, although it is desirable activity, an increase fiscal burden – sums Jakub Borowski, chief economist at Credit Agricole . And it may mean that if the expenditure is to grow, it will not seal over and should increase taxes. Another consequence may be necessary to change the expenditure rule. – The change would not be necessary if the government will raise the revenue to GDP ratio on a scale that will provide him the opportunity to increase spending without increasing the deficit and debt . Otherwise it has to change, which means undermining the whole so far implemented strategy – emphasizes Borowski.
No comments:
Post a Comment