The last meeting of the Council of Ministers saw the passing of the draft of the budget for 2016. It will now be consulted with social partners.
When addressing the basic figures contained in the draft one has to recognize that the estimation of the deficit limit at a record high level of 54.6 bln PLN is a cause for concern. On the other hand, conservative income prognoses indicate that some of this sum is only a buffer against the necessity of amending the budget in case of unpredictable developments next year.
Prognoses for key macroeconomic indices have not changed in relations to the guidelines to the draft of the budget presented in June. The government estimates can be seen as realistic. The expected average annual inflation rate is the most objectionable, as it can turn out to be significantly lower than the Ministry of Finance assumes. This would exert negative pressure on the realization of the budget income plan, but due to the caution applied when constructing the plan, it should not lead to exceeding the budget limit.
Maintaining basic budget discipline is ensured by the stabilized spending regulation passed two years ago. Nonetheless, the budget draft is not free of pre-election elements, the inclusion of which means that the path of restricting public deficit delineated in the latest amendment to the convergence program will not be kept. This is bad news, as the current period of relatively good economic climate should be used to improve the balance of government and local government institutions. The realization of this goal is aided by the currently low public debt maintenance costs and the fact that GDP dynamics is approaching 4 percent.
Łukasz Kozłowski, economic expert of Employers of Poland