All three previous government had to – due to economic reality, not only expectations from Brussels – tackle the issues of how to restrain the increase of expenses while the revenues had been falling, how to stabilise banks as well as how to manage and sell off state assets.
None avoided the issue of reforming the pension system and making changes to the labour market. All these problems will descend on the new government, too.
The party that won the elections has dodged the millstone of bank rehabilitation that was around the last government’s neck, but will still have to reserve almost one percent of GDP to finish the capitalisation. One of the first tasks of the new government will be preparing the budgets for the next two years.
This will be an opportunity to set down a consistent policy, since it will need to become clear how the government plans to hold back and decrease the expenses for the public sector by additional EUR 10 million. Will cutting material costs be a good enough measure, as Cerar claims?
Representatives from the private sector are expected to increase pressure on lowering the tax burden on labour costs. The government will have to face the dilemma if, or in whose favour, contribution rates should be limited, and then the inevitable: how to fill in the loss in the treasury as well as the pension and medical funds – with property tax?
Combinatorics will most likely turn out to be a very difficult issue with questionable success. Public borrowing awaits the new government, too. We received information that the current, outgoing government had planned issuing a 10-year bond for next year.
The new finance minister will have to take over now and offer Slovenian debt to foreign investors again. And their first question will be privatisation. Cerar announced this would be decided as soon as the government is formed.
Judging by the statements, selling off certain selected share of state companies is expected to take place. Money from the purchase wouldn’t relieve state finance substantially, but foreign owners would enable other companies to obtain financial sources outside of Slovenia, where loans are cheaper.
Hopefully, Cerar will know how to make sure Slovenia opens up to the world economically. The European Commission, which has sent warnings regarding corruption, will certainly like his announced fight against it. And the citizens would like to measure the success of corruption extermination in the health system.