Higher salaries and pensions, debt up to 600 million euros

The Government of Montenegro adopted the Draft Law on the budget for 2023, which is projected at 2.85 billion euros. At the beginning of the Government session, Prime Minister Dritan Abazović said that the budget foresees for the first time an increase in salaries in public administration, education and the police. According to the budget proposal for the next year, the total social benefits will be increased by 45 million euros, 35 million is intended for increasing the pension. 67 million euros have been earmarked for salary increases, said Finance Minister Aleksandar Damjanović. Debt of up to 600 million euros is planned for the next year.
Prime Minister Dritan Abazović said that the proposed budget foresees the largest capital budget that Montenegro has ever had and that, if the highway is not counted, it amounts to slightly more than 200 million euros.
"For the first time, the budget envisages an increase in salaries in the public administration, that is, education and the police. A child's allowance is being introduced for all children up to 18 years of age, and means are provided for each newborn to receive monetary compensation from the state," said Abazović.
He added that allocations and subsidies for agriculture will be higher, and aid is planned for each municipality in the north of Montenegro, up to one million euros for capital projects.
Abazović said that the projected debt implies money that would go into deposits, in order to ensure security in the globally unpredictable next year.
"This Government has never borrowed, this year's exports were 70 percent higher than last year, the coverage of imports by exports is at the level of 20 percent, economic growth is 7.7 percent, and the current stay of tourists is 45 percent higher than in the record year 2019." , said Abazović.
He added that next year's gross domestic product (GDP) will exceed five billion euros.
No more money for welfare
Minister of Finance Aleksandar Damjanović announced that the budget framework for the next year is 2.85 billion euros, which is 165 million euros more than this year, including the rebalancing. This, according to him, is aimed at preserving the standard of the population, taking into account the inflationary shocks and all the legacies that impact this standard.
"The social component is at a historical maximum, so 756 million euros will be set aside for social benefits, which is a never-higher amount, and if other benefits are included, the total transfers for social protection will be 785 million," said Damjanović.
He added that an additional 35 million euros have been allocated for increasing pensions in the coming year, as well as 67 million for increasing wages in the public sector, including education, health and state administration.
"These are measures that are not populism or exaggeration, but elementary measures to preserve the achieved level of living standards," said Damjanović.
35 million more for the capital budget
He stated that the capital budget, if the highway is excluded, is allocated 35 million euros more than this year, as well as that it covers 294 capital projects.
"We have finally integrated the funds from economic citizenship into this budget and they will be used to encourage balanced regional development," said Damjanović.
He announced that the revenues were very conservatively planned and that not a single cent was planned in the part where there is no legal basis.
"They are conservatively planned, just like the GDP, and we hope that in this way we will create the preconditions for additional revenues. There is a huge area of ​​tax potential in suppressing the gray economy and in defining those revenues that were previously released", said Damjanović.
He said that by suppressing the gray economy and expanding the tax scope, the space for additional debt is reduced.
"Average growth is planned at around four percent for the next year, due to the relatively high base this year and negative tendencies," explained Damjanović.
705 million will be missing, debt up to 600 million euros
He said that the missing funds in the budget were planned at 705 million euros.
"In the decision on indebtedness, we have foreseen a limit of 600 million euros, bearing in mind that it will be much smaller, if the limit we have this year is filled as much as possible through rebalancing, that is, if through indebtedness for this year we create a fiscal reserve for 1. January, in order to more calmly define the necessary additional funds for the following year", explained Damjanović.
He added that the debt measure, which was provided by the decision of the parliament, is a measure to create a fiscal reserve on January 1, and to that extent, this limit will not be necessary in full.
"The challenge is to push through the next year without additional shocks, with the growth of economic activity, private investments, making decisions regarding capital matters in Montenegro, with the resolution of accumulated problems in companies, so that in the coming years they enter the period of sustainable finances," he said. is Damjanović.

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