Government approves package to curb budget deficit

The Czech caretaker government on Monday unanimously backed a cost-saving and tax-raising budget proposal for 2010 tabled by Finance Minister Eduard Janota. Mr Janota’s package is seeking to limit next year’s deficit to 155.3 billion crowns instead of the record 230 billion deficit the country is now heading for. Prime Minister Jan Fischer has made acceptance of a budget with the deficit capped at 170 billion crowns a condition of his staying on in office after the abandonment of autumn elections. Mr Janota’s has presented his package as a more or less equal mix of spending cuts and tax rises. It includes rises in Value Added Tax and social insurance payments, cuts in social spending and a 4.0 percent cut in public service wages and for politicians and judges. Leaders of politician parties are due to continue talks on the budget on Tuesday and Wednesday with the lower house expected to weigh in on Thursday.