President Petr Pavel has signed the state budget for the upcoming year with a deficit of 252 billion crowns, 43 billion less than this year’s approved deficit. The Castle made this announcement on Monday evening.
The budget is the first state budget that Pavel has signed in his presidential function and the third budget that the coalition government of Petr Fiala (ODS) has pushed through. The House approved it on November 29. The planned budget revenues will increase by 12 billion to 1.94 trillion crowns compared to this year. On the other hand, planned expenditures will decrease by 31 billion to 2.19 trillion crowns. The budget is based on the assumption of economic growth of 2.3 percent and a rise in household consumption supported by a renewed increase in real incomes. The average inflation rate is expected to drop from 10.9 to 2.8 percent this year.
The budget also plans for the average teacher’s salary to increase to 52,400 monthly crowns. The average pension should increase to 20,635 crowns from January. Expenditures on debt service will also increase yearly by 25 billion CZK to 95 billion crowns.
The government highlights the main budget priorities as maintaining social peace, ensuring a predictable way of financing healthcare, securing teachers’ salaries at 130 percent of the average wage, and ensuring expenditures in the volume of two percent of gross domestic product for defense. “It is the best proposal we can currently achieve under our conditions. We are fighting with record debt, with extremely high demands – debt service costs. Still, despite all current challenges and crises and the burden we inherited from the previous government, we are again on the path to balanced management,” said Prime Minister Fiala in the House about the budget.