The Slovenia Times

PM Bratušek Hosting Party Leaders for Fiscal Rule, Referendum Talks


Bratušek is to present the parliamentary leaders new calculations of the effects of the fiscal rule on public finances.

The prime minister announced the release of fresh data two weeks ago, when the National Assembly decided to postpone a vote on the fiscal rule to 7 May.

Bratušek deems the proposal tabled by the previous Janez Janša-led government, under which the fiscal rule would be implemented in the 2015 budget, as overly optimistic.

She thinks 2017 might be a more realistic year. Her main concern is that the macroeconomic situation has deteriorated too much in the meantime.

The government argues that implementing the fiscal rule in 2015 would entail an EUR 800m rise in taxes and revenues or equal spending cuts.

Even if the rule was implemented in 2017, this would still call for a EUR 400m rise in revenues or just as high expenditure cut, according to the government.

While this is roughly the view of the coalition Positive Slovenia (PS) and the Social Democrats (SD), the opposition Democrats (SDS), People's Party (SLS) and New Slovenia (NSi) believe a deferral of the fiscal rule would send the wrong signal to the international community and financial markets.

The SDS, SLS and NSi also believe MPs should first decide on constitutional changes to the referendum rules and only then on the fiscal rule.

The opposition fears that the government parties want to implement the referendum rules and then drag their feet on the fiscal rule. They say the fiscal rule ought to be a priority.

Both amendments to the Constitution require a two-thirds majority in parliament, which requires cross-partisan consensus.

According to the current parliament agenda, the MPs will first vote on the referendum rules and then on the fiscal rule.

However, Speaker Janko Veber has said the sessions would be rescheduled if necessary.

The fiscal rule as it is currently framed would require that the budget be balanced or in surplus in growth years, but it would allow the government to run a deficit in a downturn.

New referendum rules, meanwhile, would exempt certain laws, such as budgets and other fiscal legislation, from referendum voting, and make it more difficult in general to call a referendum.

Both amendments to the Constitution will be closely watched by the unions, which were instrumental in shooting down the previous government's reforms with referenda.

The ZSSS, Slovenia's biggest trade union grouping, recently said politicians should "pull the handbrake on constitutional changes".

It has suggested before that the amendments themselves could be subjected to a referendum if referendum rules are tightened too much.


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