Presentation of next year's budget: Government's contradictory story about savings

During 2016, the fiscal policy of the Government of the Federation of BiH will be oriented towards activities that will contribute to the economic and social strengthening of the Federation, and in this context, the limitation of budget spending in 2016 will continue through strict austerity measures in all segments of public spending - said Jelka Milićević, Minister of Finance in the Government of the Federation of BiH, presenting the new budget of the Government of FBiH, writes the BiH news agency Patria.

How this looks in practice, Milićević reveals in the following sentences.

- Salaries and employee cost compensation are planned in the amount of 217.5 million KM, which is an increase of 6.3 million KM compared to this year's budget. How an increase in salaries means savings is something few can decipher.

Milićević confirmed that the current reserve in the Draft amounts to 5,155,000 KM. Within this current reserve, there will be the usual reserve for the Prime Minister in the amount of 75,000 KM, and for the two Deputy Prime Ministers in the amount of 40,000 KM each.

Other allocations have also been increased.

Expenditures for materials, small inventory, and services in the Draft amount to 91.8 million KM, expenditures for interest are 123.3 million KM, expenditures for the procurement of fixed assets are 21.3 million KM...

Savings are necessary because increased loan installments are also due for payment. In the Draft budget of the Federation of BiH for 2016, expenditures for debt repayment are planned in the amount of 974.9 million KM, which is 116.2 million KM or 13.5 percent more compared to the budget for 2015.

A larger debt is certainly a reason for greater savings, especially since it can already be said that there is no serious GDP growth.

Therefore, the story about savings and the reduction of public spending are on the same side of the stick that the Government is showing to the people.