The measures are incorporated into changes to the act on the implementation of the 2013 and 2014 budgets, which follow the idea of greater flexibility in the redistribution of material costs, a key demand by trade unions.

Cuts of EUR 108.6m for this year and EUR 182.6m are to be secured through a mix of cuts in base pay, lower government contributions in the additional public sector pension scheme, halving of the bonus for academic title and reduction of sickness benefits.

Another EUR 99.3m and EUR 25.3m respectively are to be secured through redistribution of material costs.

Cuts will be progressive, affecting those in high-income brackets more than low-paid employees. Depending on the pay bracket, base pay is expected to be reduced from 0.5% to 4.86%.

Another measure is a higher fee for RTV Slovenija, with the government deciding to cancel the 5% cut introduced by the previous government on 1 January this year and restore the 2012 monthly fee of EUR 12.75.

Also official as of today is the raising of VAT (from 20% to 22% for the standard rate and from 8.5% to 9.5% for the reduced rate) starting with 1 July, which is expected to bring an extra EUR 250m into the budget. The government wants to fast-track the law to that effect through parliament.

Public Administration Minister Gregor Virant told the press after the government session that the fiscal target set down in the reform and stabilisation documents sent to Brussels had been secured in the talks with unions.

According to the latest figures presented by the minister, the deal with the unions secured total savings of EUR 190m this year and EUR 260m next year.

Public sector trade unions are still deciding on their final support for the initialled agreement, Virant however expects it will be backed by the majority. He expects the deal to be signed next Monday and followed by a session of the National Assembly on Tuesday.

He said that the signatures of the two police trade unions and the Fides doctors' trade union, which are opposing the deal, would not be necessary to secure the needed majority, but indicated that separate talks with them could continue.

Virant moreover announced that additional measures would follow, mentioning a more effective tax collection system and better efficiency in public procurement.