„FREEZING public sector salaries justified next year“

In 2021, the rise in pensions and salaries needs to be controlled, and it would be justified to completely freeze salaries in the public sector, the Fiscal Council stated. In the report „Effects of the Health Crisis on Fiscal and Economic Trends in 2020 and Recommendations for 2021 Fiscal Policy“, the Fiscal Council stated that „the state no longer has as many resources available for a strong intervention because it irrationally borrowed more than 600 million euros in order to pay 100 euros to adult citizens“. „In such circumstances, the state deficit will amount to record-breaking seven percent of gross domestic product (GDP), and the public debt at the end of the year will be over 60 percent of GDP,“ the Fiscal Council stated. It is added that the growth of the public debt is primarily a consequence of the immoderate increase in salaries in the public sector of almost ten percent at the beginning of 2020. According to the assessment of the Fiscal Council, such a rise in salaries would be too high even if the plan of GDP growth of four percent was realized this year. Therefore, in 2021, it is necessary to reduce the deficit to about two percent of GDP in order to stop the growth of public debt. In addition, as stated, allocations for infrastructure construction and healthcare should be increased.

Izvor: Beta

Foto: BIZLife