Finance minister consults cost-cutting measures with party leaders

Next year’s state budget deficit could be as low as 157 billion crowns if the draft package of austerity measures is approved in its present form, Finance Minister Eduard Janota told the ctk news agency after negotiations with political parties' representatives on Friday. The revised package provides for an increase in both VAT rates by one percentage point. It will reportedly save 12 billion crowns in social and mandatory spending on the side of expenditures. The cost-cutting measures would only apply for 2010. The government is to discuss and approve the package on Monday. Political leaders will be debating the proposed cuts further. After two attempts at early elections were scupperd Prime Minister Jan Fischer made it clear that his caretaker government will only remain in office if politicians agreed on a budget with a maximum deficit of 170 billion crowns i.e. 5 percent of the GDP.