Parliament approves main 2014 budget figures



Parliament approved the main figures of the 2014 budget on Tuesday after the budget committee passed amendments that raised the main budget figures, including the cashflow deficit on Monday.  The amendments, submitted by the budget committee last week, raised total 2014 central government expenditure from the figure in the original bill by HUF 85 billion to HUF 16.9683 trillion and raise total revenue by HUF 26 billion to HUF 15.9837 trillion.

The cashflow deficit under the amended bill will rise by HUF 59.9 billion -- about 0.2% of GDP -- to HUF 984.6 billion. The amendments will not alter the accrual-based EU-conform general government deficit target for 2014 which will remain 2.9% of GDP, economy ministry State Secretary Péter Benő Banai told the budget committee on Monday.

The main budget figures were approved with 219 votes in support and 30 votes against. MSzP and Jobbik MPs voted against the budget, while deputies from opposition party Politics Can Be Different (LMP) party abstained from the vote.

The bulk of the raised spending in the Monday amendments raised the appropriation for paying off municipal debt to HUF 60 billion from HUF 4 billion in the original bill. The money spent by the central government will be neutral for the general government as will be revenue for municipalities, Banai explained. The early repayment is part of the planned takeover of the remaining HUF 420 billion municipal debt announced by the government early November.

The measure, planned to be completed by the end of next February, follows a two-step takeover of some HUF 757 billion of municipal debt late in 2012 and early in 2013, and will leave local councils debt free.

The other major amendment increased central budget support to Budapest city transport to HUF 24 billion from an original HUF 10 billion. The bulk of the HUF 25 billion additional revenue foreseen by the amendments will come from a HUF 14 billion increase of the VAT revenue target and from HUF 10 billion will come from additional state-assets related revenue. Banai termed the VAT revenue increase "realistic" when asked in the budget committee.

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