National Assembly Starts Debate on Austerity Bills


The government's goal is to lower the budget deficit to 3% of GDP this year, which is why it proposes several cuts in expenditure, most notable in public sector pay, education and social transfers in the bill on the balancing of public finances.

In a bid to avoid a referendum on the austerity measures, which were met with strong opposition from the trade unions, the government agreed to water down some of its initial proposals.

The most controversial proved to be public sector pay cut, but the government and trade unions managed to strike a eleventh hour deal on the issue after more than a month of negotiations.

To cater for the deal with the unions the government will amend the omnibus bill during the session. In line with yesterday's agreement, it will scrap an amendment restricting retirement conditions.

The supplementary budget for this year is to cut expenditure to just over EUR 9bn, which is EUR 1.1bn less than envisaged in the current budget, which was passed in late 2010 on the assumption that Slovenia's economy would see healthy expansion this year.

Yet with the economy in recession, budget revenues expected to fall to EUR 7.9bn (from the EUR 8.7bn predicted in the original budget) this year. Several small protests against the austerity measures are expected to accompany the parliament's session.