Proposed Finance Minister to Continue Fiscal Consolidation

By , 07 Sep 2018, 08:50 AM Politics
Andrej Bertoncelj Andrej Bertoncelj fm-kp.si

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STA, 6 September 2018 - Andrej Bertoncelj said his priorities were to continue with fiscal consolidation and a comprehensive, budget-neutral tax restructuring, create a stable financial system, and overhaul the state asset management strategy as he was grilled by the parliamentary Finance Committee as the candidate for finance minister on Wednesday. 

Bertoncelj, 61, a holder of a PhD in finance who has been nominated by the Marjan Šarec List (LMŠ), told the committee that "Slovenia must remain an economically successful country and a welfare state".

Under his leadership, the Ministry of Finance would "act towards ensuring a stable fiscal environment, a well-functioning financial system and a stable and predictable business environment".

According to Bertoncelj, Slovenia is on the right track in terms of fiscal consolidation. More should be done to reduce the structural deficit and the general government debt, with the goal being to bring the latter below 60% of GDP, he said.

The key factor of success in the future budget will be to increase revenue. "We need to roll up our sleeves immediately," he said, adding that preparing a supplement to the 2019 budget would be his first priority as minister.

Bertoncelj told the opposition MPs that he had taken into account the golden fiscal rule of a balanced budget when announcing various measures in the coalition agreement.

"The coalition agreement is a guideline for me. Expenditure will be in line with our capacities - if GDP continues to grow at the current pace, we will have much more wiggle room," he said, while stressing that rationalising expenditure was a must.

The candidate announced a "comprehensive and budget-neutral tax restructuring", and changes to taxation of real estate and motor vehicles. "We need to find an adequate solution for taxation of labour and capital," he said, pointing to the need to increase tax collection efficiency.

The current stand-in member of the management board of Slovenian Sovereign Holding (SSH) also announced an overhaul of the state asset management strategy and the creation of a demographic fund to prop up the pension system.

Regarding the size of state assets, Bertoncelj said that a consensus should be reached on which assets are strategic and that he expected "much debate about this". When it comes to the demographic fund, he said that the "trends are very worrying".

The Finance Ministry will also take measures to improve the situation on the labour market. These measures will "enable further reduction of unemployment, faster entry of young people and slower exit of older people from the market."

Bertoncelj believes that the banking system needs to provide more support for the economy. He said that one of the goals in this field was to conclude privatisation of the banks NLB and Abanka as planned in 2018 and 2019, respectively, and to increase the powers of the Money Laundering Prevention Office.

Other goals of note are increasing the yield on state-owned assets, a more active role of the SID bank as the national development and export bank, and improving relations with international institutions such as the EIB, EBRD and World Bank.

The Finance Committee okayed the candidate with ten votes in favour and none against.

If appointed minister by the National Assembly, Bertoncelj will no longer be able to serve as a stand-in member of the SSH management board along with the only other board member Lidija Glavina.

The SSH supervisory board has decided that in such a case, it will resort to the possibility of a court appointing a temporary management board member.

Bertoncelj, who is also a SSH supervisor, was appointed interim management board member at the end of April. The board is still missing the third member.

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