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6 months of Government under PM Janša

6 months of the Government under the Presidency of Janez Janša

The main goals over the first half-year of the Government of the Prime Minister Janez Janša were the maintenance of financial sustainability and the promotion of economic growth. Ministers faced a budget deficit on the budget items of individual ministries and an unrealistic budget for 2012. Immediate action was necessary – the adoption of emergency austerity measures and revision of the 2012 national budget. At the same time, measures for the promotion of the economy and the creation of conditions to improve the competitiveness of the Slovenian economy were being prepared.

 

In March, the Government adopted the 1st economic stimulus package. This package resulted in reducing the tax burden for enterprises; in addition, the Government introduced unlimited relief on investments of 40%, aimed at stimulating enterprises and private entrepreneurs to invest and achieve higher added value and therefore greater competitiveness. Tax reliefs for R&D were increased as well, clearly demonstrating to investors that the Government supports a society of development and knowledge. When such measures were adopted, the President of the Management Board of Krka d.d., which is one of the most successful Slovenian enterprises, said that the investment environment ‘has probably not been as favourable in years’.

 

At the end of June, the 2nd economic stimulus package consisting of 16 sectoral laws was adopted, which aims to create an environment that is more entrepreneurship-friendly and to reduce administrative barriers. The package contains 75 different measures for the promotion of economic growth, including the elimination of administrative barriers and reducing financial burdens. To this end, the Government will allocate EUR 377.5 million through calls for tenders: EUR 148.5 million for subsidies, EUR 50 million for guarantees and EUR 179 million through the implementation of public investments.It should also be noted that the National Assembly has already passed certain key laws from this package (e.g. amendments to the Companies Act, Prevention of Restriction of Competition Act, etc.); a 3rd package of measures is planned for the autumn also to tackle certain systemic changes in developing the competitiveness of Slovenian economy.

 

The Government's next significant task will be the harmonisation of the 2013 and 2014 budget proposals within the frameworks outlined in the plan for balancing public finances. To persist in the balancing of public finances and reduce government expenditure are important factors in maintaining the country's credibility in the international environment. Ratings made by international credit rating agencies confirm the Government's view that prompt action is necessary. Political consensus concerning the need to take action and the direction of such action is one of the preconditions for economic recovery and restoring the confidence of international markets. In this regard, the inclusion of the golden fiscal rule in the Constitution within the shortest possible time and the adoption of the Establishment of the State Holding Act, together with measures for the rehabilitation of the banking system, are crucial measures.

 

This should be followed by the adoption of structural reforms, which will send a strong signal to the international environment that Slovenia's approach to resolving the current situation is active and prudent.

 

As has already been suggested more than once, problems that were accumulating over a number of years may not be eliminated overnight. Also for this reason, the adoption of the Balancing of Public Finance Act and revision of the 2012 national budget, based on austerity measures, was significant for the past six months, this being only the first step towards recovery.


SIX MONTHS OF THE GOVERNMENT under the Presidency of Janez Janša

 Overview of the achievements and priorities by ministries (204 KB)