Hike of all pensions by 8.0% to cost Serbian budget RSD40bn

An 8% hike of all pensions by the end of the year would increase budget expenditures by RSD40bn, the daily Politika writes today. The same percentage increase for all pensioners is one of the three scenarios under consideration to deal with the law on temporary reduction of above-average pensions. The media say that the new finance minister (who is yet to be appointed) may have to revise the 2018 budget because of the pensions. A few days ago, President Aleksandar Vucic hinted at the possibility of budget revision in October to include money for wages and pensions. He added that more about that should be known at end-July or early August after checking GDP parameters.

The 2018 budget plans a central government budget deficit at RSD28.4bn (0.6% of GDP), while the general government budget deficit is seen at 0.7% of GDP. Public sector wages already went up by 5-10% as of Jan 1, while pensions – by 5%. President Vucic and PM Ana Brnabic have said at several occasions that one more hike of wages and pensions could be expected this year.

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