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The Estonian Investment Agency

Estonian parliament passes negative supplementary budget

20.01.2009

BNS - The Estonian parliament Friday passed a negative supplementary budget for this year.

The budget collected 61 votes in favor and 35 against in the 101-seat body.

The supplementary budget lowers the amount of revenues by 9.63 billion and of expenditures by 6.57 billion kroons. According to the supplementary budget the revenues of the state budget for this year total 88.20 billion kroons (EUR 5,635 mln) and of expenditures 91.89 billion kroons (EUR 5,871 mln).

The target for the inflow of revenue to the state budget is 66.4 billion kroons. The forecast of the inflow has contracted by 10.7 billion kroons compared with the end of last year.

The supplementary budget enables use of means of the country's stablization reserve to up to 3.5 billion kroons and up to nine billion kroons of loan money.

The biggest source of economy in the supplementary bugdet has been achived due to slashing running costs of public institutions and operating subsidies given from the state budget to the tune of about 1.5 billion kroons.

Compared with plans made at the end of 2008 the economy from these budget lines will amount to an average of 10 percent. Teachers, interior security and cultural workers have been treated as an exception in the supplementary budget.

Instead of 14 percent as earlier planned, there will be a rise in pensions by 5 percent. Also the cost-sharing for days on sick leave will be extended to three days while the costs of the following five sick-leave days will be for the employees to finance.

The share of individual's income tax allocated to local governments will fall from 11.93 percent to 11.4 percent from April 1, 2009. Simultaneously obligations of the local governments will be revised.

Amendment of 20 other legal act will be necessary in order to carry out measures of the government sector austerity measures package.

(EUR 1 = EEK 15.65)

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