BELGRADE – There will be no further cuts in public sector salaries and pensions, Serbian Prime Minister Aleksandar Vucic said at Monday’s parliament session on the budget.
“There will be no more cuts in salaries and pensions, and citizens can only expect prosperity,” Vucic said addressing MPs during the debate on the second review of the 2014 budget and the draft budget for 2015.
Cuts in public sector salaries and pensions over RSD 25,000 amounting to 10 percent on average were introduced on November 1 with the first budget review for 2014 passed on October 27.
“If we had not initiated deep-seated reforms, there would not be any salaries and pensions in six months,” the prime minister said.
Vucic said that he understands all those people staging protests in the streets and that he knows why and how much they are disgruntled, but underlined that there will be no exceptions from cuts in salaries.
The prime minister said that he is thankful to all citizens who respect, understand and support the government’s moves in these difficult times, adding that they know what this government has inherited.
Vucic said that it is his decision to pass this kind of budget, adding that he assumes all responsibility “since many will be angry because the budget is the way it is.”
The prime minister thanked the coalition partners for supporting him in drafting a budget that would be the only way for Serbia to recover.
Vucic said that there were two pathways before the government, one that is easier but deceitful, and the second one that implies difficult reforms.
The prime minister said that the government opted for the second path and embarked on tough, deep-seated reforms so that Serbia could record growth in 2017.
The IMF forecasts that Serbia will have a growth of four percent growth in 2016, and over two percent in 2017, he said.
“The budget deficit in the period January-November this year has been reduced by ten percent compared to the same period last year. We have recorded a dramatic VAT increase, which reflects the fight against gray economy, greater collection of excise duties, these are all significant results,” said Vucic.
The prime minister has called on MPs to adopt the new review of the budget, which is a result of greater revenues and cuts in expenditures than envisaged by the previous review.
Vucic said that this is not unusual, adding that he hopes that the next year will see several budget reviews that will result from revenue growth.
The prime minister refuted that the government is recouping the losses of airline Air Serbia and Srbijagas.
“We do not recoup any losses of Air Serbia, because Air Serbia has not made a loss, it was done by the Democratic Party’s management (of the old national airline JAT), and these losses are the state losses. The government has only noted this and it has to recoup them,” said Vucic.
Speaking about the debt of public company Srbijagas, he said that the government must settle this debt even though it was incurred during the rule of the Democratic Party.
“It is important that citizens know all this,” the prime minister said, adding that electricity and telephone debts of some ministries have been cleared.