The first budget outside of enhanced supervision is being submitted to parliament today

By Chrysostomos Tsoufis

At 12 noon the government submits the last budget to the Parliament before the national elections, the first budget after 12 years which is submitted with the country out of enhanced supervision and therefore the Christos Staikouras characterizes him as historical. Like the previous ones, however – perhaps with the exception of 2020 as the pandemic had not started at the end of 2019 – this budget is being submitted in an environment of intense uncertainty.

In relation to the draft budget, the final text will predict a growth rate for this year above 5.3%certainly above 5.5%, but the forecast will not have 6 in front, in contrast with the estimates of both the Commission and the Bank of Greece. The information says that the Ministry of Finance will have also lowered the bar of growth for 2023 from the 2.1% of the draft as the autumn estimates of Brussels have intervened according to which the Greek economy will not grow above 1%. In any case, the country will do much better than the Eurozone again this year, let alone next year when it is doubtful whether the Eurozone will avoid recession, with the Theodoros Skylakakis to declare to Parliament that the era of downsizing is over. And of course the public debt will also follow a downward path, which at the end of 2023 will be close to 160% of GDP.

Based on these forecasts, that this year for tourism was ultimately better than 2019 and that the execution of the state budget is very encouraging, it is considered certain that the year will close with a primary deficit of less than 1.7% which will predict budget with the government already drawing up its plans for a new household aid package. In 2023, the country returns to primary surpluses of 0.7% but without the imposition of new taxes.

In terms of inflation, there will be a review here as well. The 8.8% of the draft will rise to just below 10% while it is unlikely that the Ministry of Finance will maintain its original forecast of inflation of just 3.3% in 2023 when Brussels estimates 6%, and the new estimate is expected to move to area of ​​5%.

The budget text will also incorporate €3.4 billion of permanent income support measures. Of course, the increase in pensions to a percentage of more than 7.5%, the abolition of the solidarity contribution for both pensioners and civil servants, the maintenance of reduced insurance contributions in the private sector, the maintenance of the reduced VAT on transport, catering, sport and culture until the end of June 2023, an increase in the maternity allowance in the private sector, increases in NHS doctors and an increase in the student housing allowance.

The discussion and elaboration of the draft budget for 2023 will be held by the competent committee of economic affairs of the Parliament on November 23-25. The plenary debate begins on December 13 and ends on December 17 with its vote.

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