The announced budget rebalance shows that the Government of Montenegro continues with the policy of enormous indebtedness of all future generations, and this year alone, it will approach the “magical” number of 940 million Euros of loans, which is a clear alarm that the public finances of the country are sinking deeper.
Of the projected 940 million, the government planned to lend 440 million to “patching the holes“ in the budget and repaying of debts, while half a billion of the new eurobonds was issued at the international market, which will refinance the existing debt, but also provide additional funds for the payout of the Italian company A2A, in order for the state to regain ownership in the Electric Power Company of Montenegro (EPCG).
The rebalance also shows that the Government has increased the amount to 12.8 million Euros for the payment of debts of Montenegro Airlines and Crnogorska plovidba, which are due this year, for which it initially allocated 6.4 million Euros. However, according to data by the MANS Investigation Center, the Government paid nearly 15 million Euros for last year’s debts of the two companies, and it is unclear how it now projects a smaller amount.
In addition, in the middle of this year, the issue of paying the debts of Barska plovidba can be opened, based on the loan for the purchase of ships. Bar-based company is in an unenviable financial situation, and it is not even mentioned in the budget rebalance by the government that it will most likely pay its debts.
Also, in the explanation of the draft of budget rebalance submitted to MPs, the Government did not make any effort to explain in detail any proposed changes. Thus, regarding the increase in the budget of the Ministry of Public Administration of up to 4 million Euros, it vaguely stated that it will be used for public administration reform and that the funds are provided from the donations of the European Union.
The mentioned increase is very indicative and the question is how much of that money will be used for new employment in the year of presidential and local elections in a large number of municipalities, such as the capital city.
Also, the Government did not explain the increase in capital revenues by as much as 43 million Euros, except for the vague stating that the most of it is related to dividend income, but without specifying the data from which majority and full state-owned companies these revenues are expected, which further confirms that citizens do not have even basic information on filling the state cash register and spending money from it, even though they are the ones “struck” when it needs to be filled.
In favor of alarming situation with public finances and indebtedness of the country, the best evidence is that over the past 9 years, that is, from 2009 to the end of last year, the government’s debt plan amounted to 2.7 billion Euros, and that it actually indebted surreal 4 billion Euros.
Therefore, it is totally unacceptable for the Government to enormously indebt taxpayers for years, instead of determining a set of measures that would substantially fill the budget, such as increasing the tax rate on profits, concession fees, luxury taxing, abolishing privileged VAT for privileged ones, improving the tax arrears collection.
Ines Mrdović
Coordinator of MANS Investigative Centre
