The Factions “European Georgia”, “European Georgia – Movement for Freedom”, and “European Georgia – Regions” held the discussion of the Bill on Changes to the Law on State Budget 2020, introduced by the Deputy Finance Minister, Giorgi Kakauridze.

He dwelt on the budget fulfillment indices, scheduled changes and the forecasts for 2021. The draft provides information on the changes. As noted, the economic growth in January exceeded 5%, though the pandemic had a negative effect on the incomes in February, which was the challenge for the global economy in general, the economic growth decreased in Georgia. In communication with the IMF it was resolved that the budget should be planned with the 4% reduction, though in terms of the monetary funds, the agreement was achieved on readiness for further reduction for a longer period, or in case of the second wave, the budge to be ready to mobilize the resources.

“The budget without the grants and loans was scheduled in the amount of 13 bl. 705 ml GEL, the income part of the mixed budget is reduced with 1 bl. 817 ml GEL to be defined with 11 bl. 888 ml GEL. The expenditures part is also reduced by 1 bl. 545 ml GEL, and the amounts from the LEPLs are also reduced with 167 ml GEL. While negotiating with the IMF, one of the parameters to be maintained was the budget deficit index, and we agreed on increase of the index from 2,5% to 8.5%”, - the reporter noted.

To cover the reduced 1 bl. 800 ml GEL and the 3,4 bl. package envisaged under the anti-crisis plan, the expenditures should be decreased. “Hence, the expenditure part in the mixed budget is reduced with 600 ml GEL, but is supplemented with more than 1 bl. 800 ml GEL to be reflected in the expenditure part”.

As the reporter noted, the budget allocates 3.4 bl. GEL for the anti-crisis plan: “450 ml GEL is envisaged to render aid to the citizens left unemployed. 1200 GEL shall be issued part by part for 6 months. In terms of the taxes, 250 ml GEL is envisaged as tax remissions. 300 GEL will be in a single manner issued for the self-employed persons constituting 75 ml GEL total, and 170 ml GEL is envisaged to cover the utility costs of the population, 85 ml GEL is envisaged for various social groups. Besides, the budget envisages 133.5 ml GEL for StopCov fund to be consumed on countering the virus, remuneration for the damaged, and 45 ml GEL is envisaged for the quarantine areas. The healthcare costs, the prevention part and treatment expenses constitute 245 ml GEL, 60 ml GEL is envisaged in the infrastructural component of the healthcare, the credit guarantee scheme constitutes 330 ml GEL, the interest cost of the hotels and the subsidies constitute 70 ml GEL, exemption of the travel agencies from the property fees takes 45 ml GEL, and the small grant financing takes 20 ml GEL, support of the construction sector, including acquisition of the accommodation for the IDPs takes 40 ml GEL, support to agriculture takes 139 ml GEL and two large components – excessive VAT refund with 600 ml GEL; and long-term liquidity for the commercial banks with 600 ml GEL. In total, it is the 3,4 bl. package of the anti-crisis plan”, - G. Kakauridze noted.

He dwelt on the financing of certain institutions and stated that despite the reduced financing, none of the projects are annulled, only postponed. The municipalities in terms of tax incomes lost 250 ml GEL and 70 ml GEL is envisaged in the budget in capacity of the transfer to partially indemnify the loss.

The state financing of various projects is reduced with 547 ml GEL, though there is an extra 2 ml GEL. Ultimately, the expenditure part is increased by 1 bl. 490 ml GEL to constitute 15 bl. 923 ml GEL.

He answered the critical questions of the opposition.

MPs rejected the part of the budget.