Romanian FinMin says Jan-Sep budget execution “leaves room for unplanned expenditures”

The budget execution in the first three quarters of the year leaves room for expenditures that were not planned in advance but are essential for the population - such as the electricity price subsidisation, acting finance minister Dan Vilceanu said, according to Adevarul.

A bill aimed at capping the electricity prices for households is currently under debate in Parliament.

The budget execution also reveals that the Government has increased the public investments - which is one of the main elements of the Government’s policy.

The public deficit in the first nine months of the year was RON 44.3 bln (EUR 9 bln), the equivalent of 3.77% of GDP. The Government targets a 7.13% of GDP deficit for the whole year (cash terms).

Regarding the budget execution in the first nine months of the year, the revenues increased by 18.7% YoY to RON 270.4 bln (23.0% of GDP, up from 21.6% of GDP in Jan-Sep 2020). Half of the increase in revenues was explained by the higher VAT and excise tax collections.

The expenditures increased by only 6.7% YoY to RON 314.6 bln (26.8% of GDP, down from 27.9% of GDP in Jan-Sep 2020). Among the key expenditures, the public payroll increased by only 2.2% YoY to RON 82.7 bln - 7.0% of GDP, down from 7.7% of GDP in Jan-Sep 2020. Notably, the public sector payroll contracted by 2.4% YoY in Q3 alone.

In contrast, the social security expenditures increased by 7.5% YoY to RON 111.8 bln, or 9.5% of GDP, still down from 9.9% of GDP in Jan-Sep 2020.

(Photo source: Inquam Photos/Ilona Andrei)