Preparations for talks on fiscal measures proceeding well

Initiatives

Preparations for government talks on fiscal measures necessary to achieve the deficit target are proceeding well, the National Economy Ministry told MTI on Tuesday, responding to a query.

The ministry said that the government would hold talks on fiscal and policy directives with regard to the Convergence Program several times in the second half of March and in April. It said the government would discuss budgets for this year and the coming years as well as measures necessary to achieve the deficit targets. It added that the measures would be announced after the updated Convergence Program is approved in April.

The ministry reiterated that the Széll Kálmán Plan, a restructuring program unveiled last spring, establishes a clear guide on state tasks in which there are "efficiency reserves". These include the areas of employment and the labour market, drug subsidies, state and local government financing and public transport, it added.

The ministry said there were some areas in which the finalization of measures had still not taken place, such as in public transport. Savings will thus deviate from the HUF 550 billion target in the plan for 2012 and the HUF 902 billion target for 2013, it added.

In addition to these main areas of intervention, the content of government measures will be adjusted to fit the current situation, the ministry said. New proposals could be made in several cases, and measures planned for 2013 could be moved forward, it added.

The ministry confirmed that the scale of the measures has still not been decided.

Most of the government's measures until now have been targeted at the expenditure side, and this remains the intention, the ministry said.

The European Union recently decided on a partial suspension of Hungary's Cohesion Fund allocation from 2013 unless it takes sufficient measures to bring its fiscal deficit under the 3%-of-GDP threshold.

EU finance ministers could lift the suspension, based on these measures, as early as June.

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