Opposition rejected as budget bill moves forward

RIGA - In an emergency meeting on Dec. 12, the government turned down  all proposals for amending the 2012 state budget that were submitted by Saeima opposition MPs, and forwarded the budget bill to the Saeima for a second review, reports LETA. Altogether, more than 230 proposals were received for amending the budget bill.

Parliament will review the bill in the second reading on Dec. 15. The government on Dec. 12 approved several technical alterations to the budget bill, and only those proposals were approved that were in line with the ruling coalition’s opinion.
Finance Minister Andris Vilks (Unity) said after the meeting that the proposed amendments envisaged increasing the budget expenditure by 173.7 million lats (248.1 million euros) altogether, which is an increase the government cannot afford because of the ongoing budget consolidation and the plan to complete the international loan program this year.
Some budget positions, though, will be allotted more funds than initially planned, for instance, the Culture Ministry will be provided 240,000 lats for implementation of the 2014 European Capital of Culture program; funding will also be increased for the Latvian Institute of International Affairs and the Constitutional Court.

Vilks evaded the question on whether the 2012 state budget will have to be amended sooner or later, emphasizing that this depended only on the situation in the euro area. The budget will only be amended if the Latvian economy fares “very well” or “very bad” next year, he said.
Saeima approved the 2012 national budget and the accompanying bills in the first reading last week. Fifty-six parliament members voted for the budget bill, 40 voted against.

Consolidated budget revenue next year is projected at 4.5 billion lats, whereas expenditures 4.6 billion lats. The budget deficit, calculated pursuant to ESA methodology, will not exceed 2.5 percent of gross domestic product next year.
The master budget’s revenue is projected at 3.2 billion lats; expenditures at 3.2 billion lats. Special budget revenue will amount to 1.2 billion lats; expenditures 1.4 billion lats.

The budget bill says that the maximum government debt will be 6.2 billion lats at the end of 2011.
The budget is based on the prediction that Latvia’s GDP will amount to 14.4 billion lats. The necessary consolidation amount for 2012 will reach 156.1 million lats; the average inflation 2.4 percent.