Finance minister calls for more budget cuts

TALLINN - The Estonian finance minister has said that expenditures in next year's budget, which was passed on Wednesday, should have been drastically slashed.
 

The adopted budget was the best that could be achieved at present, the minister, Ivari Padar, said at the government news conference. He added at the same time that it would have been sensible to find spots for further cuts to the tune of around 1 percent of gross domestic product which would increase certainty of the 2009 budget deficit not exceeding 3 percent of GDP.

The local elections slated for the next year may increase the risks relating to the public sector loan burden as local authorities may be tempted to borrow more heavily ahead of the polls, the minister said.

Padar said he made several suggestions about cuts prior to the adoption of the budget. It could have been agreed, for instance, not to implement certain investments until figures of the actual budget revenue intake became available in the middle of the next year, he said.

"We have a single goal: to meet the Maastricht criteria (for euro adoption) in 2010," Padar stated.

The budget slashes the expenditures of ministries and state institutions by around two billion kroons (127.8 million euros) compared with the Finance Ministry's original draft.