The state budget deficit amounted to 14 billion kuna last year, and the new government has found an additional 2.2 billion kuna of unpaid bills, Finance Minister Slavko Linic said at a government meeting on Thursday while speaking about the execution of the 2011 budget.
Last year budget revenues reached HRK 107.4 billion and expenditures HRK 121.4 billion, and the deficit was officially HRK 14 billion. However, we have found an additional 2.2 billion kuna of unpaid bills -- nearly HRK 950 million for agriculture, HRK 480 million for shipbuilding, HRK 339 million for the Financial Agency, HRK 170 million for shipping companies that had commissioned ships from domestic shipyards, and not all liabilities towards the Catholic Church were paid either, Linic said.
The total deficit therefore was HRK 16.2 billion, which was 4.7% of GDP and not 4.1% as was presented. If we add to it money for state funds and local government units, the deficit increases to 5% of GDP, Linic said.
GDP stagnated last year because growth was zero per cent, inflation rose from 1.1% in 2010 to 2.3%, industrial output declined, and upward trends were recorded only in tourism and to a slight extent in the retail sector.
Last year's budget revenues did not change substantially in relation to the previous year. Tax revenues fell by 1%, mostly revenues from income tax, while VAT revenues remained at the 2010 levels.
On the expenditure side, subsidies remained the same as in 2010, exceeding HRK 6.6 billion, while expenses on salaries went up about 2% from the previous year.
The government today adopted amendments to the Financial Insurance Act, introducing a loan as an instrument of payment insurance, provided that it is not a consumer loan.
