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STABILITY PROGRAMMES

Amendments 2017

The Stability programme for 2017 was prepared while taking into account the Ordinance on the framework for the preparation of the general government budget for the 2018-2020 period, adopted by the National Assembly on 20 April 2017 as per the Fiscal Rule Act (hereinafter referred to as ZFisP). As per the Act, the framework determines the target balance and the largest possible extent of general government expenditure for an individual fiscal year and target balances and the largest possible extent of expenditure from individual public finance budgets for the next three years, i.e. 2018, 2019 and 2020. At the same time, growth in GDP is forecast to be 3.6% due to changed circumstances (The Spring Forecast of Economic Trends for 2017; IMAD) and is expected to be about 3% in the next two years.

 

In the past, the Stability Programme served as a Slovenian medium-term fiscal framework (or its complement). As in the previous year, it also presents the amendment to the budgeting framework as per Article 6 of the ZFisP, where the target for general government balance and the largest extent of general government expenditure are determined in accordance with Article 3 of the ZFisP. Slovenia is thus meeting the requirements of Council Directive 2011/85/EU on requirements for the budgetary frameworks of Member States.

 

The Government of the Republic of Slovenia insists on the projected path that the structural fiscal balance will be offset by the end of 2020 according to assessments of when Slovenia’s medium-term fiscal objective (MTO) will have been met. Since Slovenia has not yet achieved its MTO, the transitional period and the rule of Article 15 of the ZFisP apply, i.e. that the structural deficit must be gradually reduced towards the MTO in a manner which compliant with the Stability and Growth Path. During the convergence, the ZFisP does not provide for the speed of adjusting or the formula for calculating the upper threshold of expenditure.