The Czech Chamber of Deputies passed the 2019 state budget bill with a 40-billion-crown deficit.

19. 12. 2018

The budget bill was supported by 108 deputies, all whom ANO (78), the CSSD (15) and the KSCM (15) have in the 200-seat Chamber.


The planned deficit is ten billion crowns lower than that projected for 2018. The budget projects the overall state expenditures at 1,505 billion crowns and revenues at 1,465 billion.

The budget reckons with a 3.1-percent economic growth, the average inflation rate of 2.3 percent and unchanged unemployment rate of 2.3 percent.

The cabinet plans to collect almost 769 billion crowns in taxes in 2019, which is some 40 billion more that what it expects to collect this year.

PM and ANO leader Andrej Babis said in the bill's first reading earlier this autumn that the budget, if passed, would improve the lives of citizens and also help entrepreneurs and self-employed people.

The government previously said its main spending priorities are the raising of the average monthly pension by about 900 crowns and of the wages in some professions, mainly teachers, as of January. Further priorities are an increase in the sum going to universities, sports and investments.

In the lower house debate today, Finance Minister Alena Schillerova (for ANO) said the draft budget reflects the government's priorities and is good.

She opposed the right-wing opposition MPs' criticism of the deficit bill as money wasting in the current period of economic growth and their dismissal of the draft budget as an attempt by the government parties to buy or bribe voters.

The budget compensates for the budget cuts the previous cabinets made during the financial crisis [in the late 2000s and early 2010s]. The wages of teachers and other civil servants are being raised, Schillerova said.

At the same time, the new budget focuses on investments, for which it earmarks almost 80 billion crowns, which is the largest sum in the past ten years, she said, adding that together with the EU money, the investments in the Czech Republic should reach some 122 billion crowns next year.

Schillerova also compared Czechia with Germany and Slovakia, the two neighbouring countries projecting a balanced budget.

"The state of public finances of both Slovakia and Germany is worse than the Czech Republic's," Schillerova said, adding that the Czech draft budget deficit makes up 0.7 percent of GDP.

Before the final budget vote, the Chamber voted on a number of partial proposals to shift financial sums between the draft budget chapters, as submitted by the lower house committees and individual government and opposition deputies.

It nodded exclusively to proposals submitted by the KSCM-led budget committee and two individual KSCM deputies, and turned down all made by the rest of the opposition.

First, it supported the addition of 327 million crowns to the chapter of investments in social services in compliance with the request of the budget committee, initiated by its member Roman Onderka (CSSD).

It also nodded to shifting 600 million crowns in support of municipal flats and schools construction at the initiative KSCM MP Miloslava Vostra and at the request of the budget committee, which she heads.

Furthermore, it shifted 100 million crowns from the climate protection chapter to the wages of the police and firefighters on the proposal of KSCM MP Zdenek Ondracek.

On the proposal of KSCM MP Hana Aulicka Jirovcova, the Chamber added 200 million crowns to the social services chapter. It rejected the chapter's steeper increase proposed by the ODS, Pirates and the Christian Democrats (KDU-CSL).

The other opposition proposals were rejected as well. The deputies for the Mayors and Independents (STAN), TOP 09 and the Pirates unsuccessfully sought additional sums to go to teachers' wages. The Chamber also rejected TOP 09, the ODS and the Freedom and Direct Democracy's (SPD) proposal to raise the defence spending by 13, four and one billion crowns, respectively.

The Pirates failed to push through their proposal that the state save 11 billion crowns by transferring the sum from several budget chapters to the government reserve. Similarly, the Civic Democrats (ODS) unsuccessfully sought a transfer of 40 billion crowns to the State Debt Service. ($1=22.638 crowns)

CTK Prague, Dec 19

The Czech Chamber of Deputies passed the 2019 state budget bill with a 40-billion-crown deficit. (19.12.2018)

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