Bank pleads to cover deficit

  • 2003-05-01

The Bank of Estonia said that before drawing up a supplementary budget additional revenues should be found in order to cover the 2003 budget deficit caused by pension reform.

Prime Minister Juhan Parts, however, has said he favors keeping the deficit.

Tanel Ross, head of the Bank of Estonia's international and public relations division, said that in light of the country's upcoming accession to the EU and the accompanying preparations to the European Economic and Monetary Union, the government's budget strategy should remain conservative.

"Although Estonia can expect rather good economic growth in the first quarter, there are several risks involved in this year's economic development," said Ross.

"Therefore, opportunities should be found to cover the budget shortfall due to the pension reform."

In Parts' opinion the deficit should be left in the budget.

His predecessor, Siim Kallas, said in January that the state budget should be balanced if revenues turned out to be better than expected.