30.7 C
Nicosia
Wednesday, April 17, 2024

Vaccination with an additional € 1.8 billion COVID

Must read

Vaccination with an additional € 1.8 billion COVID

The coronavirus pandemic upset the economic plans of Cyprus, as well as all countries. What they have managed to build in recent years with strict fiscal policy has been torn down, as countries spend millions of euros each month to deal with the effects of the pandemic. The Commission and the ECB, in an effort to help the Member States of the European Union, have made fiscal and other easing so that countries can be more flexible in dealing with COVID-19.

In particular, they allowed budget overruns and deficits, as well as additional cheap borrowing, above the limits that were considered inviolable until 2019.

The implementation of the Stability and Growth Pact is expected to resume in 2022, which is a matter of concern for the Member States, as in the midst of the pandemic, they will be forced to return to the implementation of strict fiscal policies.

In Cyprus, in the last 18 months, additional expenditures have been given, in addition to € 1.8 billion for the implementation of employee support plans, the granting of one-time sponsorship to companies, for conducting diagnostic tests (rapid test and PCR test), for quarantine hotels, for medicines and vaccines. The technocrats of the Ministry of Finance consider that the pandemic is one of the fiscal risks that will affect the government's financial planning for 2022 and will have a negative impact on public finances. According to the Ministry of Finance, any outbreak of the coronavirus pandemic in the country will result in further deterioration of economic activity.

YPOIK goes and comes to the Parliament

From the data collected by “F”, it seems that so far the state has addressed the Parliament nine times, during the pandemic, requesting the approval of supplementary budgets, totaling € 1.5 billion. two supplementary budgets a year, last year and this year, due to the fiscal easing decided by the Commission in March 2020, nine supplementary budgets were tabled, so that the state could meet the needs arising from the coronavirus.

By law, the finance minister has the right to submit an additional budget for a vote before June 15, when special circumstances apply, such as an unusual event that spirals out of the Republic's control and has a significant impact on the general government fiscal situation or during periods of severe recession. .

The 9 additional

Of the nine supplementary budgets submitted to Parliament by the government in the last 18 months, 5 were submitted in 2020 and this year so far. 4. Specifically, in March 2020, during the first lockdown, Parliament approved additional appropriations of € 369 million, which burdened the budget by 1.3% of GDP. The additional appropriations of € 369 million were channeled for the granting of a “Special Permit” to parents working in the private and public sectors, for the care of children up to the age of 15 (up to the third grade of high school) due to the suspension of schools, public and private, nursery and daycare centers (€ 40 million).

In addition, an amount of € 110 million was given for the implementation of the suspension plan to companies that had suspended their operations and to companies which, although they continued to operate, had a 25% reduction in turnover. The aim of the plans was to prevent layoffs.

It is worth noting that employees whose workplaces were closed due to the lockdown were granted unemployment benefits. € 10 million was also given for the implementation of the Small Business Support Plan. The plan was aimed at companies that employed up to 5 people, provided that they keep their employees at work and have reduced their turnover by more than 25%. At that time, the government subsidized 70% of their salaries.

Funds of € 16 million related to the payment of sickness benefit, on average € 800 per month, to a number of eligible employees. € 100 million was also given to strengthen the health sector and to employ additional medical, nursing and support staff, aid in equipment and logistics, support of the Institute of Neurology & Genetics in human resources and logistics. Another € 15 million was paid for the Student Abroad Allowance, amounting to € 750, which covered the expenses of students who studied abroad and did not return to Cyprus during the Easter holidays, as well as € 11 million for recovery. of tourism.

The second supplementary budget for 2020 was € 220 million, for the implementation of plans to support businesses, employees, students, health and the economy in general. The balance of the fiscal balance amounted to 1.1% of GDP.

The third supplementary budget for 2020 provided for additional appropriations of € 231.1 million and put a burden on the budget balance of 1.14% of GDP. The money from the third budget was channeled for the continuation of the government plans to support employees with € 150 million, to satisfy requests submitted by Independent Services / Ministries / Undersecretaries / Departments to the Ministry of Finance, to cover additional needs for social benefits, benefits as well as other costs. At the same time, a number of positions in the public sector were abolished and upgraded, the number of teachers increased by 243 and nine new positions of public prosecutor were created in the Legal Service, a new position of quality assurance officer at the Ministry of Tourism, a new position of supervisor in the Wine Products Council.

The fourth supplementary budget of 2020 provided for the allocation of additional appropriations of € 667 thousand for the recruitment of 200 Contract Hoplites (SYOP), however it was voted down by Parliament.

The fifth supplementary budget provided for additional appropriations of € 254.2 million. The burden of the budget balance from the adoption of the supplementary budget amounted to 0.2% of GDP.

I exceed € 0.5 billion.

Compared to this year, so far the additional appropriations have reached € 510.2 million. This amount does not include the additional appropriations of € 200 million, which were included in the revised state budget of 2021, in the context of the need to support businesses and independent workers, due to the implementation of measures to deal with the ongoing pandemic.

Appropriations of € 20 million were also included to provide support and stimulate the economy more broadly. In detail, this year, the first supplementary budget approved by Parliament was € 250 million. The money was channeled to support businesses, employees and the health sector. The second supplementary budget was approved a few weeks before the parliamentary elections and provided for the allocation of additional appropriations of € 148.5 million, which were spent on social benefits, health benefits, agricultural payments and various other needs. The second supplementary budget also provided for the creation and upgrading of a limited number of jobs, including the creation of the post of Deputy Minister of Social Welfare and Director General. In addition, the third supplementary budget, which was one of the first pieces of legislation approved by the new Parliament, provided for the allocation of additional funds of € 20 million to support the fire victims, from the big fire that broke out last summer in mountainous areas of Larnaca and Larnaca provinces. Limassol and Paphos province.

Budget impact, overruns and deficits

The fiscal easing that took place in 2020 and 2021, in the context of government policy to address the health crisis from the pandemic, had an impact on both the state budget of 2022 and the Medium Term Fiscal Framework (MTEF) 2022-2024. The preliminary draft state budget for 2022 presents financial deficits of € 1.2 billion (2022), € 1.5 billion (2023) and € 1.7 billion (2024). As the finance ministry points out, public debt remains high, urging ministries to meet spending ceilings. As he points out, between the total appropriations of next year's budget and the total ceilings set by the Council of Ministers, there are exceedances of € 70 million (2022), € 248.2 million (2023) and € 348.4 million (2024). . In 2022, the exceedances are mainly due to the exceedances from the ceilings in the budgets of the Ministries of Education (€ 24.4 million), Interior (€ 19 million), Labor (€ 17.1 million), Justice and Public Order (€ 16, 1 million), and Energy (€ 8.7 million).

It bets on reforms and the Recovery Plan

It is worth noting that the government side is betting a lot on the implementation of the National Recovery Plan, through which the state will raise € 1.2 billion by 2026. Government sources estimate that the reforms and projects included in the fund will be a tool to strengthen businesses and the self-employed who have been affected by the pandemic. Within two months, the Parliament will have to approve 23 bills, which concern, among others, the reform of the public service, justice and local self-government in order to disburse in 19022 an amount of € 190 million.

Philenews

RUN and POWER Group: Enhanced Living Experience.

Source: 24h.com.cy

- Advertisement -AliExpress WW

More articles

- Advertisement -AliExpress WW

Latest article